The Local Job Multipliers of Green Industrialization

Federico Frattini (), Francesco Vona, Filippo Bontadini () and Italo Colantone
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Federico Frattini: POLIMI - Politecnico di Milano [Milan]
Filippo Bontadini: SPRU - Science and Technology Policy Research - University of Sussex
Italo Colantone: Bocconi University [Milan, Italy], GREEN Research Center, CESifo - CESifo

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Abstract: What are the job multipliers of the green industrialization? We tackle this question within EU regions over the period 2003-2017, building a novel measure of green manufacturing penetration that combines green production and regional employment data. We estimate local job multipliers of green penetration in a long-difference model, using a shift-share instrument that exploits plausibly exogenous changes in non-EU green innovation. We find that a 3-years change in green penetration per worker increases the employment-to-active population ratio by 0.11 pp. The effect is: persistent both in manufacturing and outside manufacturing; halved by agglomeration effects that increase the labour market tightness; stronger for workers with high and low-education; and present also in regions specialized in polluting industries. When focusing on large shocks in a staggered DiD design, we find ten times larger effects, particularly in earlier periods.

Keywords: Difference-in-differences; Shift-share IV design; Employment effects of the green transition; Local job multipliers; Green industrialisation (search for similar items in EconPapers)
Date: 2025-10
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Working Paper: The Local Job Multipliers of Green Industrialization (2025)
Working Paper: The Local Job Multipliers of Green Industrialization (2025)
Working Paper: The Local Job Multipliers of Green Industrialization (2025)
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