The employment impact of motor vehicle assembly plant openings

Brian Adams

Regional Science and Urban Economics, 2016, vol. 58, issue C, 57-70

Abstract: Local governments often offer motor vehicle assembly plants large subsidies to locate in their jurisdiction. A frequent justification is that an assembly plant will attract upstream parts suppliers to locate nearby and provide manufacturing jobs. Using propensity score matching, I find that an assembly plant brings an average of 500 additional parts supplier jobs beyond the employment gains the region would have experienced without the assembly plant. This increase is far less than predicted by the input–output models that state development agencies often employ.

Keywords: Regional development; Motor vehicle manufacturing; Agglomeration; Location choice (search for similar items in EconPapers)
JEL-codes: L62 R11 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:regeco:v:58:y:2016:i:c:p:57-70

DOI: 10.1016/j.regsciurbeco.2016.02.005

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