10.17889/E111991V1
Woolston, William Gui
Chodorow-Reich, Gabriel
Liscow, Zachary
Feiveson, Laura
Replication data for: Does State Fiscal Relief during Recessions Increase Employment? Evidence from the American Recovery and Reinvestment Act
ICPSR Inter-university Consortium for Political and Social Research
2011
10.1257/pol.4.3.118
10.1257/pol.4.3.118
1
The American Recovery and Reinvestment Act (ARRA) of 2009 included $88 billion of aid to state governments administered through the Medicaid reimbursement process. We examine the effect of these transfers on states' employment. Because state fiscal relief outlays are endogenous to a state's economic environment, OLS results are
biased downward. We address this problem by using a state's prerecession
Medicaid spending level to instrument for ARRA state fiscal relief. In our preferred specification, a state's receipt of a marginal $100,000 in Medicaid outlays results in an additional 3.8 job-years, 3.2 of which are outside the government, health, and education sectors. (JEL H75, I18, I38, R23)