Environment Versus Jobs: An Industry-Level Analysis of Sweden

CERE Working Paper, 2020:13

29 Pages Posted: 19 Jul 2020 Last revised: 4 Nov 2020

See all articles by Golnaz Amjadi

Golnaz Amjadi

STATEC Research; Centre for Environmental and Resource Economics (CERE)

Date Written: June 26, 2020

Abstract

The aim of this paper was to investigate whether the environment and employment compete with each other in Swedish manufacturing industry. The effect of a marginal increase in environmental expenditure and environmental investment costs on sector-level demand for labor (employment) was studied using a detailed firm-level panel dataset for the period 2001–2008. The results
showed that the sign and magnitude of the net employment effects ultimately depend on the aggregate sector-level output demand elasticity. If the output demand is inelastic, these costs induce small net improvements in employment, while a more elastic output demand suggests negative, but in most sectors relatively small, net effects on demand for labor. Hence, the results did not generally indicate a substantial trade-off between jobs and the environment. The general policy recommendation that can be drawn from this study is that, in the absence of empirically estimated output demand elasticities, a careful attitude regarding national environmental initiatives for sectors exposed to world market competition should be adopted.

Keywords: Environmental Management Costs, Output Demand Elasticity

JEL Classification: C33, D22, J23, K32

Suggested Citation

Amjadi, Golnaz, Environment Versus Jobs: An Industry-Level Analysis of Sweden (June 26, 2020). CERE Working Paper, 2020:13, Available at SSRN: https://ssrn.com/abstract=3636135 or http://dx.doi.org/10.2139/ssrn.3636135

Golnaz Amjadi (Contact Author)

STATEC Research ( email )

House of Entrepreneurship
14, rue Erasme
Luxembourg, L-1468
Luxembourg

Centre for Environmental and Resource Economics (CERE)

Department of Economics
Umeå University
Umeå, 901 87
Sweden

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