Job Creation in Tight and Slack Labor Markets

Lukas Buchheim, Martin Watzinger and Matthias Wilhelm
Additional contact information
Matthias Wilhelm: LMU Munich

No 144, Rationality and Competition Discussion Paper Series from CRC TRR 190 Rationality and Competition

Abstract: Do investment programs create more jobs in tight or in slack labor markets? We study this question using data from a large, long-term photovoltaic investment scheme in Germany. Comparing counties with high and low unemployment both over time and across space, we find that photovoltaic installations created at least twice as many jobs in slack than in tight labor markets. Our results suggest that the differences in job-creation are not driven by changes in the composition or prices of investment, capital-labor substitution, or regional migration. This leaves crowding-out as the most plausible mechanism.

Keywords: local employment multiplier; state-dependent multiplier (search for similar items in EconPapers)
JEL-codes: E24 E62 J23 R23 (search for similar items in EconPapers)
Date: 2019-02-27
New Economics Papers: this item is included in nep-cbe and nep-exp
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Job creation in tight and slack labor markets (2020)
Working Paper: Job creation in tight and slack labor markets (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:rco:dpaper:144

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