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Wednesday, November 30, 2016

Infrastructure, Jobs and Wages: It's Not So simple

I have a new article at MoneyWatch:

Infrastructure, jobs and wages: It's not so simple: Whether Donald Trump implements a major infrastructure rebuilding program remains to be seen, but he has certainly created the expectation that it could happen. The U.S. surely needs more infrastructure spending, and not just on new projects -- updating of existing systems is also needed.
Discussions about increasing outlays on infrastructure frequently include claims about the positive impact these programs would have on employment and wages, often referring to the fiscal policy “multiplier.” For example, it’s often claimed that government spending on infrastructure has a multiplier between 1.5 and 2. 
Does this mean we should expect a significant increase in employment and income if the government undertakes major new investment in the nation’s infrastructure? Let’s take a closer look. ...

    Posted by on Wednesday, November 30, 2016 at 10:20 AM in Economics, Fiscal Policy, MoneyWatch | Permalink  Comments (30)


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