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Do some enterprise zones create jobs?

  • Jed Kolko

    (Research Fellow, Public Policy Institute of California, San Francisco)

  • David Neumark

We study how the employment effects of enterprise zones vary with their location, implementation, and administration, based on evidence from California. We use new establishment-level data and geographic mapping methods, coupled with a survey of enterprise zone administrators. Overall, the evidence indicates that enterprise zones do not increase employment. However, the evidence also suggests that the enterprise zone program has a more favorable effect on employment in zones that have a lower share of manufacturing and in zones where managers report doing more marketing and outreach activities. On the other hand, devoting more effort to helping firms get hiring tax credits reduces or eliminates any positive employment effects, which may be attributable to idiosyncrasies of California's enterprise zone program during the period we study. © 2010 by the Association for Public Policy Analysis and Management.

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Article provided by John Wiley & Sons, Ltd. in its journal Journal of Policy Analysis and Management.

Volume (Year): 29 (2010)
Issue (Month): 1 ()
Pages: 5-38

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Handle: RePEc:wly:jpamgt:v:29:y:2010:i:1:p:5-38
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  1. Matias Busso & Patrick Kline, 2008. "Do Local Economic Development Programs Work? Evidence from the Federal Empowerment Zone Program," Cowles Foundation Discussion Papers 1639, Cowles Foundation for Research in Economics, Yale University.
  2. David Neumark & Junfu Zhang & Brandon Wall, 2005. "Employment Dynamics and Business Relocation: New Evidence from the National Establishment Time Series," PPIC Working Papers 2005.11, Public Policy Institute of California.
  3. Marlon G. Boarnet, 2001. "Enterprise Zones and Job Creation: Linking Evaluation and Practice," Economic Development Quarterly, W.E. Upjohn Institute for Employment Research, vol. 15(3), pages 242-254, August.
  4. Bondonio, Daniele & Greenbaum, Robert T., 2007. "Do local tax incentives affect economic growth? What mean impacts miss in the analysis of enterprise zone policies," Regional Science and Urban Economics, Elsevier, vol. 37(1), pages 121-136, January.
  5. Landers, Jim, 2006. "Why Don't Enterprise Zones Work? Estimates of the Extent that EZ Benefits are Capitalized into Property Values," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 36(1).
  6. Leslie E. Papke, 1991. "Tax Policy and Urban Development: Evidence From The Indiana Enterprise Zone Program," NBER Working Papers 3945, National Bureau of Economic Research, Inc.
  7. Doug Miller & A. Colin Cameron & Jonah B. Gelbach, 2006. "Bootstrap-Based Improvements for Inference with Clustered Errors," Working Papers 621, University of California, Davis, Department of Economics.
  8. Kris Wernstedt & Peter B. Meyer & Anna Alberini, 2006. "Attracting private investment to contaminated properties: The value of public interventions," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 25(2), pages 247-369.
  9. Leslie E. Papke, 1993. "What Do We Know about Enterprise Zones?," NBER Chapters, in: Tax Policy and the Economy, Volume 7, pages 37-72 National Bureau of Economic Research, Inc.
  10. Joel A. Elvery, 2009. "The Impact of Enterprise Zones on Resident Employment," Economic Development Quarterly, W.E. Upjohn Institute for Employment Research, vol. 23(1), pages 44-59, February.
  11. Glaeser Edward L, 2005. "Should the Government Rebuild New Orleans, Or Just Give Residents Checks?," The Economists' Voice, De Gruyter, vol. 2(4), pages 1-7, September.
  12. Alan H. Peters & Peter S. Fisher, 2002. "State Enterprise Zone Programs: Have They Worked?," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number sezp, November.
  13. Neumark, David & Kolko, Jed, 2010. "Do enterprise zones create jobs? Evidence from California's enterprise zone program," Journal of Urban Economics, Elsevier, vol. 68(1), pages 1-19, July.
  14. Robert T. Greenbaum & John B. Engberg, 2004. "The impact of state enterprise zones on urban manufacturing establishments," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 23(2), pages 315-339.
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