Employment and GDP impacts of U.S. infrastructure investment under various financing options, Scenario Three
| Debt | Revenue, progressive | Revenue, regressive | Transfer cuts | Regulatory mandates | |
|---|---|---|---|---|---|
| Total amount of spending ($billions) | $250 | $250 | $250 | $250 | $250 |
| Gross GDP increase from spending ($billions) | $400 | $400 | $400 | $400 | $400 |
| Gross employment increase from spending | 3,000,000 | 3,000,000 | 3,000,000 | 3,000,000 | 3,000,000 |
| Gross GDP decrease from financing ($billions) | $0 | $88 | $225 | $400 | $50 |
| Gross employment decrease from financing | 0 | 656,250 | 1,687,500 | 3,000,000 | 375,000 |
| Net GDP increase from package ($billions) | $400 | $313 | $175 | $0 | $350 |
| Net employment increase from package | 3,000,000 | 2,343,750 | 1,312,500 | 0 | 2,625,000 |
Note: Multipliers are based on evidence reviewed in Bivens (2011) and Bivens (2012c). Specifically, the multiplier for infrastructure investments is 1.6, the muliplier for regressive tax increases is (-)0.9, the multiplier for progressive tax increases is (-)0.35, the multiplier for transfers is 1.6, and following Bivens (2012c), 20 percent of the stimulative effect of investments driven by regulatory mandates are crowded out. For employment impacts, we assume each percentage-point addition to GDP adds 1.2 million jobs to the economy. The total spending figures are based on the infrastructure investment scenarios and are annual gains taking place between 2014 and 2020 as described in the text.
Source: Author's analysis of Bureau of Labor Statistics Employment Requirements Matrix industry codes receiving spending flows to finance across-the-board increase in traditional infrastructure to close infrastructure deficit identifed by ASCE (2013)
This chart appears in:
Previous chart: « Employment and GDP impacts of U.S. infrastructure investment under various financing options, Scenario Two
Next chart: Employment impact by demographic group: Scenario One ($30 billion) »