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A cost-benefit approach to the evaluation of regional selective assistance

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Author Info
Kim Swales

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Abstract

The ‘Green Book’ and the recent EGRUP report support exchequer cost per job as a key input in the ex-ante appraisal of individual applications for Regional Selective Assistance (RSA) and the ex-post evaluation of the RSA scheme as a whole. In this paper, following a recommendation in the House of Commons Trade and Industry Committee’s report on regional policy, the merits of an alternative, explicitly cost-benefit, framework are outlined. This approach incorporates the administration and compliance costs of the subsidy, costs at present ignored in RSA evaluation studies. An optimal ex-ante appraisal rule is developed. This takes the form of a cost-per-job ceiling, and a representative value is calculated for this figure.

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File URL: http://www.ifs.org.uk/fs/articles/fsswales.pdf
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Publisher Info
Article provided by Institute for Fiscal Studies in its journal Fiscal Studies.

Volume (Year): 18 (1997)
Issue (Month): 1 (February)
Pages: 73-85
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Handle: RePEc:ifs:fistud:v:18:y:1997:i:1:p:73-85

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Find related papers by JEL classification:
H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Ashcroft, Brian & Swales, J. K., 1982. "Estimating the effects of government office dispersal : An application of demand constrained shadow wages," Regional Science and Urban Economics, Elsevier, vol. 12(1), pages 81-97, February. [Downloadable!] (restricted)
  2. Hare, Paul G, 1975. "Regional Investment Criteria and Shadow Wage Rates," Scottish Journal of Political Economy, Scottish Economic Society, vol. 22(3), pages 305-20, November.
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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. David J. Brooksbank, David G. Pickernell, 2001. "Changing the Name of the Game? RSA, Indigenous and Inward Investors and the National Assembly for Wales," Regional Studies, Taylor and Francis Journals, vol. 35(3), pages 271-277, May. [Downloadable!] (restricted)
  2. Michael Devereux & Rachel Griffith & Helen Simpson, 2004. "Agglomeration, regional grants and firm location," IFS Working Papers W04/06, Institute for Fiscal Studies. [Downloadable!]
  3. Munday, Max & Pickernell, David & Roberts, Annette, 1999. "The Effectiveness of Regional Grant Aid: A Welsh Perspective," ERSA conference papers ersa99pa321, European Regional Science Association. [Downloadable!]
  4. Dimitris Skuras, Nick Tzamarias, 2000. "Job Creation by Assisted Rural Firms: a European North-South Perspective," Local Economy, Taylor and Francis Journals, vol. 15(3), pages 225-237, September. [Downloadable!] (restricted)
  5. Gary Gillespie, Peter G. McGregor, J. Kim Swales, Ya Ping Yin, 2001. "The Displacement and Multiplier Effects of Regional Selective Assistance: A Computable General Equilibrium Analysis," Regional Studies, Taylor and Francis Journals, vol. 35(2), pages 125-139, April. [Downloadable!] (restricted)
  6. Felsenstein, Daniel & Fleischer, Aliza, 1999. "Capital Assistance and Small Firm Growth: Implications for Regional Economic Welfare," ERSA conference papers ersa99pa395, European Regional Science Association. [Downloadable!]
  7. Kim Swales, 2008. "The Relative Efficiency of Automatic and Discretionary Industrial Aid," Working Papers 08-12, University of Strathclyde Business School, Department of Economics. [Downloadable!]
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