Evaluating the economic effects of a new state-funded school building program: The prevailing wage issue

Michael Greenberg, Nancy Mantell, Michael Lahr, Michael Frisch, Keith White, David Kehler

Research output: Contribution to journalArticlepeer-review

1 Scopus citations

Abstract

Two economic simulation models were used to study the economic impact of complying with prevailing-wage requirements in a $10 billion school construction program in New Jersey. Our econometric and input-output models suggest that compliance with the prevailing-wage statute will generate over $6 billion in personal income, a little more than $11 billion in gross state product, about 45,000 new jobs, and over $1.3 billion in state and local tax revenues will be created. If prevailing-wage requirements are not followed, there will be an impact on these results, and the extent of the impact depends markedly on the degree to which non-prevailing-wage workers spend their earnings in New Jersey and pay taxes. In general, prevailing-wage compliance has positive benefits for income and taxes. Non-prevailing wage construction should create more construction jobs, but these jobs create fewer additional jobs in the economy.

Original languageEnglish (US)
Pages (from-to)33-45
Number of pages13
JournalEvaluation and Program Planning
Volume28
Issue number1
DOIs
StatePublished - Feb 2005

All Science Journal Classification (ASJC) codes

  • Public Health, Environmental and Occupational Health
  • Geography, Planning and Development
  • Social Psychology
  • Business and International Management
  • Strategy and Management

Keywords

  • Economic impact
  • Income
  • Jobs
  • Prevailing-wage laws
  • School construction
  • Taxes

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