The Labor Market Implications of Renewable Energy Policies

Award Period
to
Award Amount
$173,170
Agency Name
Alfred P. Sloane Foundation
Award Number
G-2020-13958
PI First Name
Oliver
PI Last Name
 Deschenes
MSI People
Area/s of Research
Marine Conservation, Policy and Education
Abstract

Project Goal

Provide the first comprehensive empirical analysis of the implications of renewable energy transition policies in the United States on labor market outcomes.

Objectives

The primary objectives of this research are threefold:

  • Fill large gaps in the literature on labor market implications of renewable energy transitions, in particular provide credible empirical estimates
  • Collect and process the most comprehensive data sample ever assembled on labor market outcomes and renewable generation capital for the United States
  • Develop and implement a research strategy that can isolate the causal effect of renewable electricity investments on labor market outcomes at the local labor market level

Proposed Activities

We will conduct empirical analyses of labor market outcomes in the US at the county‐level. Using employment and

renewable electricity installations data, this research will estimate the immediate, medium‐term, and long‐term impacts of renewable projects on labor markets to determine if new jobs persist or fade out after the initial investment. This will be done by conducting a difference‐in‐difference analysis comparing the trajectory of employment rates and earnings in a county after vs. before the building of renewable electricity capital, compared to an otherwise similar, nearby county without new renewable electricity investment. The research will therefore evaluate how renewable electricity investments affect employment and earnings across the entire employment chain related to renewable electricity production by examining impacts across industry categories and allow for the examination of the distributional consequences of green energy transition by comparing impacts across various regional labor markets and worker characteristics.

Expected Products

  • Two peer‐reviewed publications in high‐impact economics journals
  • One or two white papers summarizing the results of the research for policymakers
  • A new longitudinal database on labor market outcome data and renewable electricity installations at the county‐level
  • Training of PhD and/or Master’s students and junior‐level researchers

Expected Outcomes

This proposed research will provide the first comprehensive set of empirical evidence on the labor market implications of low‐carbon electricity transition in the United States that is derived from real‐world data (as opposed to extrapolations or modelling output). We hope it will help inform better policy decisions by documenting the labor market impacts and trade‐offs (e.g., job creation and possible destruction) associated with renewable electricity developments.