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Why do Some Special Economic Zones Attract More Firms than Others? Panel Data Analysis of Polish Special Economic Zones

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  • Piotr Ciżkowicz
  • Magda Ciżkowicz-Pękała
  • Piotr Pękała
  • Andrzej Rzońca

Abstract

Using a unique firm-level data for Polish Special Economic Zones (SEZ) to estimate a set of panel data models we find that both employment and investment growth in SEZ are driven mainly by labour market characteristics of zone-hosting regions, while other factors (including market access, zone business climate and firms' concentration) play a less important role. Firms choose their locations based on labour availability rather than on labour costs. Moreover, they pay particular attention to availability of low-skilled rather than high-skilled labour. As far as tax incentives are concerned, their predictability matters more for SEZ development than their generosity.

Suggested Citation

  • Piotr Ciżkowicz & Magda Ciżkowicz-Pękała & Piotr Pękała & Andrzej Rzońca, 2021. "Why do Some Special Economic Zones Attract More Firms than Others? Panel Data Analysis of Polish Special Economic Zones," Prague Economic Papers, Prague University of Economics and Business, vol. 2021(1), pages 61-89.
    • Handle: RePEc:prg:jnlpep:v:2021:y:2021:i:1:id:763:p:61-89
    DOI: 10.18267/j.pep.763
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    Cited by:

    1. Susanne A. Frick & Andrés Rodríguez-Pose, 2023. "What draws investment to special economic zones? Lessons from developing countries," Regional Studies, Taylor & Francis Journals, vol. 57(11), pages 2136-2147, November.
    2. Maria O. Kakaulina & Dmitry R. Gorlov, 2022. "Assessment of the Impact of Tax Incentives on Investment Activity in Special Economic Zones of the Russian Federation," Journal of Applied Economic Research, Graduate School of Economics and Management, Ural Federal University, vol. 21(2), pages 282-324.
    3. O.A. Sinenko, 2021. "Comparative Analysis of Factors of Functioning of Special Administrative Areas in the Asian-Pacific Region," Journal of Applied Economic Research, Graduate School of Economics and Management, Ural Federal University, vol. 20(3), pages 524-559.
    4. Olga A. Sinenko & Alexey Yu. Domnikov, 2022. "Property Taxation of Companies in Territories With a Special Economic Status," Finansovyj žhurnal — Financial Journal, Financial Research Institute, Moscow 125375, Russia, issue 3, pages 74-85, June.

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    More about this item

    Keywords

    Special economic zones; regional economic development; economic policy tools; panel data models;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H32 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Firm
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

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