Local Labor Market Shocks and Earnings Differentials: Evidence From Shale Oil and Gas Booms

39 Pages Posted: 18 Jan 2018 Last revised: 28 Mar 2019

See all articles by Gregory Upton

Gregory Upton

Louisiana State University, Baton Rouge

Han Yu

Texas A&M University - Private Enterprise Research Center

Date Written: March 14, 2019

Abstract

In this research, we show that labor demand shocks to specific workers (male workers with high school education) in a specific industry that makes up a relatively small share of employment (oil and gas sector) can have significant impacts on earnings differentials both economy wide and within unrelated sectors. We estimate that a million dollars of new oil and gas production per person is associated with a 6.4% decrease in the college/high school earnings differential, and a 6.5% increase in the male/female earnings differential. We decompose the possible channels through which a productivity shock to the oil and gas sector can impact regional earnings differentials.

Suggested Citation

Upton, Gregory and Yu, Han, Local Labor Market Shocks and Earnings Differentials: Evidence From Shale Oil and Gas Booms (March 14, 2019). USAEE Working Paper . Available at SSRN: https://ssrn.com/abstract=3104693 or http://dx.doi.org/10.2139/ssrn.3104693

Gregory Upton (Contact Author)

Louisiana State University, Baton Rouge ( email )

Baton Rouge, LA 70803
United States

Han Yu

Texas A&M University - Private Enterprise Research Center ( email )

4231 TAMU
PERC
College Station, TX Texas 77840
United States
9798454344 (Phone)

HOME PAGE: http://hanyulsu.weebly.com

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