Do Tax Incentives Affect Local Economic Growth? What Mean Impacts Miss in the Analysis of Enterprise Zone Policies

Daniele Bondonio ()

Working Papers from U.S. Census Bureau, Center for Economic Studies

Abstract: Geographically-targeted tax incentives remain popular initiatives in response to deteriorating economic conditions of urban and industrial areas. This paper exploits the exogenous variations of the U.S. state Enterprise Zone programs to estimate the impact of various incentive features on a number of dimensions of local economic growth. The econometric analysis uses plant level data to sort out growth outcomes into gross flows separately accounted for by new, existing, and vanishing businesses in the target areas. Results offer empirical evidence to support a number of specific policy recommendations and show that the impact of the incentives has more complex dynamics than those revealed by the null mean impact estimates obtained from analyzing net growth outcomes.

Keywords: Tax incentives; Local economic growth; Enterprise Zones; Program evaluation (search for similar items in EconPapers)
JEL-codes: C23 O1 R5 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2003-09
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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https://www2.census.gov/ces/wp/2003/CES-WP-03-17.pdf First version, 2003 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:03-17

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