The Local Economic and Welfare Consequences of Hydraulic Fracturing

By Alexander W. Bartik, Janet Currie, Michael Greenstone, Christopher R. Knittel. American Economic Journal: Applied Economics, 2019

190 citations recorded by the source corpus.

Exploiting geological variation and timing in the initiation of hydraulic fracturing, we find that fracking leads to sharp increases in oil and gas recovery and improvements in a wide set of economic indicators. There is also evidence of deterioration in local amenities, which may include increases in crime, noise, and traffic and declines in health. Using a Rosen-Roback-style spatial equilibrium model to infer the net welfare impacts, we estimate that willingness-to-pay (WTP) for allowing fracking equals about $2,500 per household annually (4.9 percent of household income), although WTP is heterogeneous, ranging from more than $10,000 to roughly 0 across 10 shale regions.(JEL D12, K42, L71, Q35, Q51, Q53, R41)

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/c754b2abc7ae5814014121b70341c5aa69c640be

Citations in the corpus

• Who Needs a Fracking Education? The Educational Response to Low-Skill-Biased Technological Change (2020, unknown): “…in support.5 Enrollment and dropout decisions of teenagers and young adults have been the focus of much prior literature on resource booms and busts (e.g., Black et al. 2005; Emery et al. 2012; Morissette et al. 2015; Basso 2017; James 2017; Kumar 2017; Maurer 2018; Michieka and Gearhart 2018).”
• Male Earnings, Marriageable Men, and Nonmarital Fertility: Evidence from the Fracking Boom (2018, unknown): “A recent working paper by Bartik et al. (2017) estimates that households’”