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An export-base analysis of Louisiana's petroleum driven economy

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Abstract

Louisiana's economy has traditionally relied on industries that are intensive in natural resource utilization as the basis for economic growth. The dramatic energy price increases during the 1970s provided the incentives for this economy to increase its specialization in the mining and processing of petroleum-based products. A differential export-base model using ordinary least-squares (OLS) regression was developed in this paper for estimating aggregate employment multipliers. Results from the analysis indicate that oil and gas mining, chemical and petroleum manufacturing, and lumber and paper production are highly significant employment generators. Mining employment was estimated to be highly dependent on petroleum prices. By interfacing the employment demand equation with the economic base model, specific and general petroleum employment impacts are assessed. The current recession in the oil and gas mining industry is having a major impact on employment, income and public finances for this region.

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Authors and Affiliations

  1. Department of Economics and Finance, Nicholls State University, 70310, Thibodaux, Louisiana

    Donald R. Andrews (Resource Economist)

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  1. Donald R. Andrews
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Andrews, D.R. An export-base analysis of Louisiana's petroleum driven economy. Ann Reg Sci 21, 65–76 (1987). https://doi.org/10.1007/BF01540233

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  • DOI: https://doi.org/10.1007/BF01540233

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