Munich Personal RePEc Archive

The Direct Employment Impact of Public Investment

Moszoro, Marian (2021): The Direct Employment Impact of Public Investment. Published in: IMF Working Paper No. 21/131 (7 May 2021): pp. 1-20.

[img]
Preview
PDF
MPRA_paper_107930.pdf

Download (677kB) | Preview

Abstract

We evaluate the direct employment effect of the public investment in key infrastructure— electricity, roads, schools and hospitals, and water and sanitation. Using rich firm-level panel data from 41 countries over 19 years, we estimate that US$1 million of public spending in infrastructure create 3–7 jobs in advanced economies, 10–17 jobs in emerging market economies, and 16–30 jobs in low-income developing countries. As a comparison, US$1 million public spending on R&D yields 5–11 jobs in R&D in OECD countries. Green investment and investment with a larger R&D component deliver higher employment effect. Overall, we estimate that one percent of global GDP in public investment can create more than seven million jobs worldwide through its direct employment effects alone.

Logo of the University Library LMU Munich
MPRA is a RePEc service hosted by
the University Library LMU Munich in Germany.