Can the IRA and CHIPS Act Reduce Labor Earnings Inequality? Lessons from the US Shale Boom

RePEc Short ID: phe765
ORCID iD: 0000-0003-4918-3111

Hernandez Martinez, Victor; Panzitta, Geena

doi:10.26509/frbc-ec-202413

Journal Article

Can the IRA and CHIPS Act Reduce Labor Earnings Inequality? Lessons from the US Shale Boom

Abstract: We study how the US shale boom decreased labor earnings inequality by increasing demand for low-skill labor in small labor markets. The similarities in the concentrated geographic distribution of investments and the labor needed to build capacity between the US shale boom and the manufacturing construction influx that has followed the passage of the IRA and CHIPS and Science Acts raise the possibility that these bills could also impact labor earnings inequality in a similar way.

Keywords: Labor economics; Inflation Reduction Act; CHIPS and Science Act; Earnings inequality;

https://doi.org/10.26509/frbc-ec-202413