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Do enterprise zones promote local business development? Evidence from Vietnam

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  • VU, Tien Manh
  • Yamada, Hiroyuki

Abstract

We examined the effects of Vietnamese enterprise zones on local businesses based on different patterns of place-based policies as well as the ownership structure of the zone infrastructure developers (ZIDs). We constructed a panel of communes during 2000–2007 using a census survey of firms having more than nine employees and a census of zones and zone-based firms.We found that place-based policies led to growth in the number of jobs and firms in the communes where enterprise zones were located, even after excluding zone-based firms. Our findings also suggest that privately owned ZIDs worked best under corporate-tax incentives, while zones with a designated central government agency as the ZID had adverse spillover effects on business development in neighboring communes of the same district.

Suggested Citation

  • VU, Tien Manh & Yamada, Hiroyuki, 2019. "Do enterprise zones promote local business development? Evidence from Vietnam," AGI Working Paper Series 2019-04, Asian Growth Research Institute.
    • Handle: RePEc:agi:wpaper:00000153
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    References listed on IDEAS

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    1. Zheng, Siqi & Sun, Weizeng & Wu, Jianfeng & Kahn, Matthew E., 2017. "The birth of edge cities in China: Measuring the effects of industrial parks policy," Journal of Urban Economics, Elsevier, vol. 100(C), pages 80-103.
    2. Wang, Jin, 2013. "The economic impact of Special Economic Zones: Evidence from Chinese municipalities," Journal of Development Economics, Elsevier, vol. 101(C), pages 133-147.
    3. Hunt Allcott, 2015. "Site Selection Bias in Program Evaluation," The Quarterly Journal of Economics, Oxford University Press, vol. 130(3), pages 1117-1165.
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    Cited by:

    1. Tien Manh Vu & Hiroyuki Yamada, 2021. "Firms and regional favouritism," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 29(4), pages 711-734, October.
    2. Vu, Tien & Yamada, Hiroyuki, 2020. "Impacts of enterprise zones on local households in Vietnam," MPRA Paper 99473, University Library of Munich, Germany.

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    More about this item

    Keywords

    Enterprise zone; Place-based policy; Infrastructure; Private sector; Local business; O14; O18; O25; L53; L52;
    All these keywords.

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O25 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy
    • L53 - Industrial Organization - - Regulation and Industrial Policy - - - Enterprise Policy

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