carbon emissions of additional spending in these programs, per unit of planned expenditure, vary considerably. The ex ante assessed employment effect is greatest for the “cash for clunkers” program. It is also high for continuation of the production tax credit for certain renewable resources including wind, and about average across the options considered for improving building energy efficiency. Other programs are indicated to have significant employment effects per unit of expenditure, but this effect would only materialize over time. Such effects are particularly strong for battery R&D, smart metering, and green school construction (for the two latter, the long-run overall employment effects are in the range three times the short-run effects; and for the former an even greater effect). The programs by themselves (and given that they are not accompanied by e g more general pricing reforms) do not significantly reduce overall U.S. carbon emissions.<sup>20</sup> One must however be a bit cautious in interpreting the numbers from the Houser et al study, as it is based on a number of potentially contestable assumptions. One is the spending propensity of households of money freed up by lower energy costs, which is assumed in the study to be 50 percent. Another issue is that a good deal of the effects is in terms of “moving up” the employment effect to the current year, which would otherwise occur in later years (as e g for the “cash for clunkers” program). Such aspects of course make the study even more uncertain as a model for similar effects in developing countries.

A few recent studies from high-income countries, all focusing on employment effects of renewable production, may also be of value as a backdrop. Several of these are for European economies where the overall public support to renewable energy has been the greatest. Note that support to renewables production represents a somewhat different category of policies that that just studied for the U.S., in particular as it major effects are more of a long-run character. Renewables support is also typically given a variety of formal justifications apart from net employment or macro output effects (including energy security, reduced carbon emissions, and learning effects and technological development in the energy sector). Even so, at least in many European countries, net job creation has by many been emphasized as a main benefit of support to the renewables sector.

The conclusion of some of these studies is in this respect quite negative. Álvarez et al (2009) discuss employment effects of public support to renewable production in Spain, considering also the lost opportunities to support employment in alternative sectors. The conclusion is that for each job created in the renewables sector, more than two jobs are lost in the rest of the economy. To large measure this conclusion reflects the substantial current difference in energy (in particular, electricity) production costs from renewables, relative to production costs based on other energy sources. This has at least two aspects: first, insofar as direct public support to the renewable sector is concerned, such support is expensive per job created, relative to what can be created in other sectors; secondly, insofar as the support comes in terms of a feed-in tariff structure, electricity prices are raised above rates otherwise experienced, leading to higher business costs with resulting job losses elsewhere. Such losses vary among renewable energy sources, and are particularly high for photo-voltaic solar electricity production.<sup>21</sup> 20 The reduction in overall carbon emissions in the U.S. related, say, to a “green stimulus” program of overall size US$ 50 billion would, under these assumptions, amount to about 30 million tons annually, or about half of one percent of current U.S. annual carbon emissions.

21 The numerical estimates on employment generation from this study have been criticized harshly in the SEF Alliance (2009) study, on a number of accounts. A main objection is that the study is non-specific when 16