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Modeling the Labor Implications of the Energy Transition
The energy transition away from fossil fuels toward alternative energy sources will, like every significant economic transition, disrupt existing economic relationships and markets. Disruption in the labor market is of particular concern due to the distributional and political importance of energy jobs and the potential concentration of risks on workers in carbon-intensive sectors and regions that are particularly reliant on fossil-fuel industries. We look at modeling the labor implications of the energy transition. We outline a conceptual framework for analyzing the labor-market risks, focusing on obstacles to labor-market adjustments during the transition. We then review empirical research on such barriers to labor-market adjustments, with a focus on evidence that can inform modeling efforts. We also survey the literature on ex-ante modeling of the effects of the energy transition on labor markets, identifying both the challenges and opportunities for new research in this field.
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