<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>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 on infrastructure creates 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 in public spending on R&amp;D yields 5–11 jobs in R&amp;D in OECD countries. Green investment and investment with a larger R&amp;D component deliver a higher employment effect. Overall, we estimate that 1% of global GDP in public investment can create more than seven million jobs worldwide through its direct employment effects alone.</p>
</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 on infrastructure creates 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 in 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 a higher employment effect. Overall, we estimate that 1% of global GDP in public investment can create more than seven million jobs worldwide through its direct employment effects alone.

The direct employment impact of public investment

International Journal of Management and Economics

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

{"article-title":"The direct employment impact of public investment"}

We evaluate the direct employment effect of the public investment in key infrastructure ‒ electricity, roads, schools and hospitals, and water and sanitation....

The direct employment impact of public investment

Article Category: Empirical Paper

Published Online: Mar 22, 2024

Page range: 59 - 74

Received: Jan 02, 2023

Accepted: Jul 14, 2023

DOI: https://doi.org/10.2478/ijme-2023-0020

Keywords
COVID, employment, public investment, stimulus

© 2023 Marian W. Moszoro, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

The direct employment impact of public investment

Article Category: Empirical Paper

Published Online: Mar 22, 2024

Page range: 59 - 74

Received: Jan 02, 2023

Accepted: Jul 14, 2023

DOI: https://doi.org/10.2478/ijme-2023-0020

KeywordsCOVID, employment, public investment, stimulus

© 2023 Marian W. Moszoro, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

Keywords
COVID, employment, public investment, stimulus