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Evaluating the Impacts of Local Economic Development Policies On Local Economic Outcomes: What Has Been Done and What is Doable?

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  • Timothy J. Bartik

    ()
    (W.E. Upjohn Institute for Employment Research)

Abstract

This paper argues that more rigorous evaluations of local economic development policies are feasible. Programs that aid selected small firms can be rigorously evaluated using an experimental approach, without excluding firms from assistance, by randomly assigning some firms to receive more intense marketing efforts by the program. Programs that aid distressed local areas can be rigorously evaluated by random assignment of the program among eligible distressed areas. If an experiment cannot be done, a variety of statistical approaches can be used to compare firms or areas that use the program with comparison groups of firms or areas that do not use the program. These statistical analyses should be supplemented with surveys and focus groups with businesses that use the program, which give some insight into why the program works or doesn't work. Evaluations should go beyond the effects of programs on business growth to effects on local fiscal health and the earnings of the unemployed. Evaluations using rigorous approaches suggest that programs providing information services to small manufacturers are frequently effective. Programs targeting distressed areas are ineffective unless great resources are used over a lengthy period.

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Bibliographic Info

Paper provided by W.E. Upjohn Institute for Employment Research in its series Upjohn Working Papers and Journal Articles with number 03-89.

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Date of creation: Nov 2002
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Handle: RePEc:upj:weupjo:03-89

Note: A revised version of this paper appears in Evaluating Local Economic and Employment Development: How to Assess What Works among Programmes and Policies. 2004. Paris: OECD.
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Keywords: evaluation; local; regional; economic; development; Bartik; Upjohn;

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References

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  1. Charles E. McLure, Jr. & Walter Hellerstein, 2002. "Does Sales-only Apportionment of Corporate Income Violate the GATT?," NBER Working Papers 9060, National Bureau of Economic Research, Inc.
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  4. Timothy J. Bartik, 1999. "The Market Failure Approach to Regional Economic Development Policy," Book chapters authored by Upjohn Institute researchers, in: John P. Blair & Laura A. Reese (ed.), Readings in Urban Economics: Issues and Public Policy, pages 14-24 W.E. Upjohn Institute for Employment Research.
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  8. Leslie E. Papke, 1993. "What Do We Know about Enterprise Zones?," NBER Working Papers 4251, National Bureau of Economic Research, Inc.
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  12. Timothy J. Bartik & Richard D. Bingham, 1995. "Can Economic Development Programs Be Evaluated?," Upjohn Working Papers and Journal Articles 95-29, W.E. Upjohn Institute for Employment Research.
  13. Michael Wasylenko, 1997. "Taxation and economic development: the state of the economic literature," New England Economic Review, Federal Reserve Bank of Boston, issue Mar, pages 37-52.
  14. Ronald S. Jarmin, 1999. "Evaluating the impact of manufacturing extension on productivity growth," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 18(1), pages 99-119.
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  17. William H. Oakland & William A. Testa, 2000. "The Benefit Principle as a Preferred Approach to Taxing Business in the Midwest," Economic Development Quarterly, , vol. 14(2), pages 154-164, May.
  18. Timothy J. Bartik & Peter K. Eisinger & George A. Erickcek, 2003. "Economic Development Policy in Michigan," Book chapters authored by Upjohn Institute researchers, in: Charles L. Ballard & Paul N. courant & Douglas C. Drake & Ronald C. Fisher & Elisabeth R. Gerber (ed.), Michigan at the Millennium: A Benchmark and Analysis of Its Fiscal and Economic Structure, pages 279-297 W.E. Upjohn Institute for Employment Research.
  19. Kenneth E. Poole & George A. Erickcek & Donalad T. Iannone & Nancy McCrea & Pofen Lin Salem, 1999. "Evaluating Business Development Incentives," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number gaw1999, December.
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Citations

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Cited by:
  1. Matias Busso & Jesse Gregory & Patrick Kline, 2013. "Assessing the Incidence and Efficiency of a Prominent Place Based Policy," American Economic Review, American Economic Association, vol. 103(2), pages 897-947, April.
  2. Bijie Ren, 2008. "The regional effects of marginal wage subsidies," Psychometrika, Springer, vol. 3(4), pages 598-626, December.
  3. Adrien Lorenceau, 2009. "L’impact d’exonérations fiscales sur la création d’établissements et l’emploi en France rurale : une approche par discontinuité de la régression," Économie et Statistique, Programme National Persée, vol. 427(1), pages 27-62.
  4. Busso, Matias & Kline, Patrick, 2008. "Do Local Economic Development Programs Work? Evidence from the Federal Empowerment Zone Program," Working Papers 36, Yale University, Department of Economics.
  5. Timothy J. Bartik, 2003. "Local Economic Development Policies," Upjohn Working Papers and Journal Articles 03-91, W.E. Upjohn Institute for Employment Research.
  6. repec:hal:wpaper:halshs-00575100 is not listed on IDEAS
  7. Anna Alberini, 2006. "Determinants and Effects on Property Values of Participation in Voluntary Cleanup Programs: The Case of Colorado," Working Papers 2006.1, Fondazione Eni Enrico Mattei.

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