Local Multipliers and Human Capital in the US and Sweden

30 Pages Posted: 22 Apr 2012 Last revised: 29 Apr 2015

See all articles by Enrico Moretti

Enrico Moretti

University of California, Berkeley - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Per Thulin

Royal Institute of Technology (KTH) - Department of Industrial Economics and Management (INDEK); Royal Institute of Technology (KTH) - Center of Excellence for Science and Innovation Studies; Swedish Entrepreneurship Forum

Date Written: April 13, 2012

Abstract

We show that every time a local economy generates a new job by attracting a new business in the traded sector, a significant number of additional jobs are created in the non-traded sector. This multiplier effect is particularly large for jobs with high levels of human capital and for high tech industries. These findings are important for local development policies, as they suggest that in order to increase local employment levels, municipalities should target high tech employers with high levels of human capital.

Keywords: Local multipliers, Local labor markets, Labor demand

JEL Classification: J23, R11, R12, R23

Suggested Citation

Moretti, Enrico and Thulin, Per, Local Multipliers and Human Capital in the US and Sweden (April 13, 2012). IFN Working Paper No. 914, Available at SSRN: https://ssrn.com/abstract=2043140 or http://dx.doi.org/10.2139/ssrn.2043140

Enrico Moretti

University of California, Berkeley - Department of Economics ( email )

549 Evans Hall #3880
Berkeley, CA 94720-3880
United States

HOME PAGE: http://emlab.berkeley.edu/~moretti/

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
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IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Per Thulin (Contact Author)

Royal Institute of Technology (KTH) - Department of Industrial Economics and Management (INDEK) ( email )

Stockholm, 100 44
Sweden

Royal Institute of Technology (KTH) - Center of Excellence for Science and Innovation Studies ( email )

Drottning Kristinas väg 30
Stockholm, SE-100 44
Sweden

Swedish Entrepreneurship Forum ( email )

Södra Kungstornet
Kungsgatan 33, 7tr
Stockholm, 11156
Sweden

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