Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/161089
Authors: 
Bredemeier, Christian
Juessen, Falko
Winkler, Roland
Year of Publication: 
2017
Series/Report no.: 
IZA Discussion Papers 10466
Abstract: 
We document substantial heterogeneity in occupational employment dynamics in response to government spending shocks. Employment rises most strongly in service, sales, and office ("pink-collar") occupations. By contrast, employment in blue-collar occupations is hardly affected by fiscal stimulus which is striking in light of its strong exposure to the cycle and its long-run decline due to technical change and globalization. We provide evidence that occupation-specific changes in labor demand are key to understand these findings and develop a business-cycle model that explains the heterogeneous occupational employment dynamics as a consequence of differences in the short-run substitutability between labor and capital services across occupations.
Subjects: 
fiscal policy
composition of employment
occupations
industries
heterogeneity
JEL: 
E62
E24
J21
J23
Document Type: 
Working Paper

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