Chun-Yan Kuo

Special Issue

Evaluating the Social Cost of Job Creation

Authors:
Pages:
67-82

This article discusses the principal labor market distortions and their effects on the social cost of jobs created in industrial projects. Two alternative approaches, a partial and a general equilibrium analysis, are put forth as ways to measure labor's opportunity cost in a systematic fashion. The general equilbrium approach provides a more sophisticated analysis because it takes into account labor migration between regions and the multiplier effect of job-creation projects on the project region.