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The U.S. shale boom has intensified interest in how the expanding oil and gas sector affects local economic performance. Research has produced mixed results and has not compared how energy shocks differ from equal--sized shocks elsewhere in the economy. What emerges is that the estimated impacts of energy development vary by region, empirical methodology, as well as the time horizon that is considered. This paper captures these dimensions to present a more complete picture of energy boomtowns. Utilizing U.S. county data, we estimate the effects of changes in oil and gas extraction employment on total employment growth as well as growth by sector. We compare this to the effects of equal--sized shocks in the rest of the economy to assess whether energy booms are inherently different. The analysis is performed separately for nonmetropolitan and metropolitan counties using instrumental variables. We difference over 1--, 3--, 6--, and 10--year time periods to account for county fixed effects and to assess responses across different time horizons. The results show that in nonmetro counties, energy sector multiplier effects on total county employment first increase up to 6--year horizons and then decline for 10--year horizons. In metro counties, 1--year differences analysis suggests crowding out though the multipliers are insignificant in longer horizons. We also observe positive spillovers to the nontraded goods sector, while spillovers are small or negative for traded goods. Yet, equal--sized shocks in the rest of the economy produce more jobs on average than oil and gas shocks, suggesting that policymakers should seek more diversified development.

Using a panel (2000-2011) of cross-state relocation patterns of manufacturing firms from the National Establishment Time Series (NETS) database we estimate a state-to-state relocation model for all manufacturers and separately for three groups of industries defined by knowledge intensity. The analysis of the data suggests that very few manufacturing firms relocate across state lines in any given year and the vast majority of those that do are small in size and move to adjoining states. Econometric results reveal that regional determinants of relocation decisions vary by type of manufacturing firm. Whereas a number of factors considered in this study are significant in the models, estimated marginal effects at the mean are infinitesimal. This implies that states attempting to encourage manufacturing firms to relocate from other states via traditional perspectives on business climate are unlikely to be successful.

The literature suggests that technological advance is the major driver of economic growth, yet how new knowledge translates into superior economic performance is not described by the growth theories. Two recently proposed frameworks, the missing link hypothesis and the knowledge spillover theory of entrepreneurship, describe a mechanism of the relationship between knowledge creation and regional economic performance through entrepreneurs. This study empirically tests these frameworks using the data on professional, scientific, and technical services in U.S. metropolitan areas from 2001 to 2005. The results indicate an intervening role of entrepreneurs in the relationship between patenting activity and job-creating behavior of incumbent companies, thus lending partial support to the missing link hypothesis. The knowledge spillover theory of entrepreneurship is not supported, as greater local knowledge generation does not translate into increased firm formation.

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