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Impacts of Enterprise Zone Policy on Industry Growth

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  • Sumei Zhang

Abstract

This study evaluates the impacts of the Louisville Enterprise Zone (EZ) program on the growth of different industries, covering a 20-year (1980-2000) time span. The research compares the preprogram (1980-1990) and postprogram (1990-2000) growth. A shift-share analysis first compares the regional competitiveness of EZ and non-EZ areas in 1990 and 2000, and suggests that most industries in EZ areas have been gaining strength. Five regression equations are estimated to quantify the effects of the EZ program on different industries. An instrumental variable approach is developed to deal with the possible issue of endogeneity during the EZ designation process. Results suggest that the Louisville EZ program has significantly increased the growth of manufacturing and service activities, and the program achieved its expected goals in the long run.

Suggested Citation

  • Sumei Zhang, 2015. "Impacts of Enterprise Zone Policy on Industry Growth," Economic Development Quarterly, , vol. 29(4), pages 347-362, November.
  • Handle: RePEc:sae:ecdequ:v:29:y:2015:i:4:p:347-362
    DOI: 10.1177/0891242415593343
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    References listed on IDEAS

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