Thursday, October 16, 2014

New Research: The Economic Aftermath of Resource Booms

New research forthcoming in Economic Journal by Grant D. Jacobsen and Dominic P. Parker

The Economic Aftermath of Resource Booms: Evidence from Boomtowns in the American West

The current U.S. oil and gas boom is injecting labour, capital, and revenue into communities near reserves. Will these communities be cursed with lower long run incomes in the wake of the boom? We study the oil boom-and-bust cycle of the 1970s and 1980s to gain insights. Using annual data on drilling to identify western boom-and-bust counties, we find substantial positive local employment and income effects during the boom. In the aftermath of the bust, however, we find that incomes per capita decreased and unemployment compensation payments increased relative to what they would have been if the boom had not occurred.

No comments:

Post a Comment

Reactions welcome! Please use your full name.