Evaluating the Net Cost Per Job of the 1977 Economic Stimulus Package

摘要

The purpose of this study is to access to net cost per job of various programs included in the 1977 Economic Stimulus Package using a consistent methodology for each program. This package consists of a Public Works Program, a Public Service Employment Program, Anti-Recessionary Fiscal Assistance (countercyclical revenue sharing), an Employment Tax Credit, and a tax cut. In order to find the net cost per job for public works, public service employment and countercyclical revenue sharing, the following methodology was used: (1) Estimating direct employment per billion dollars; (2) Estimating secondary employment per billion dollars; (3) Estimating the percentage of federal funds that displaced local funds and reducing the number of jobs obtained in (1) and (2) by that percentage; (4) Determining the use of displaced funds; (5) Estimating the jobs created by the displaced funds and adding those to (3); and (6) Determining the recaptures to the Treasury and reducing the cost per billion by that amount.