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Does state economic development spending increase manufacturing employment?

  • Charles A. M. de Bartolome
  • Mark M. Spiegel

Recent studies, which have attempted to determine what causes an industrial sector in a state to grow, have ignored the general role of the state's economic development agency. We extend the analysis to include its effect, and determine that economic development expenditure by the state is a statistically significant determinant of manufacturing growth in the state. Our result is robust to a variety of specification tests.

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Paper provided by Federal Reserve Bank of San Francisco in its series Working Papers in Applied Economic Theory with number 95-10.

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Date of creation: 1995
Date of revision:
Publication status: Published in Journal of Urban Economics (March 1997, v. 41, no.2, pp. 153-75)
Handle: RePEc:fip:fedfap:95-10
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  1. Crihfield, John B., 1990. "Manufacturing supply : A long-run, metropolitan view," Regional Science and Urban Economics, Elsevier, vol. 20(3), pages 327-349, November.
  2. Timothy J. Bartik, . "Jobs, Productivity, and Local Economic Development: What Implications Does Economic Research Have for the Role of Government?," Upjohn Working Papers and Journal Articles tjb1994ntj, W.E. Upjohn Institute for Employment Research.
  3. Coughlin, Cletus C & Terza, Joseph V & Arromdee, Vachira, 1991. "State Characteristics and the Location of Foreign Direct Investment within the United States," The Review of Economics and Statistics, MIT Press, vol. 73(4), pages 675-83, November.
  4. Leamer, Edward E & Leonard, Herman B, 1983. "Reporting the Fragility of Regression Estimates," The Review of Economics and Statistics, MIT Press, vol. 65(2), pages 306-17, May.
  5. Bartik, Timothy J, 1985. "Business Location Decisions in the United States: Estimates of the Effects of Unionization, Taxes, and Other Characteristics of States," Journal of Business & Economic Statistics, American Statistical Association, vol. 3(1), pages 14-22, January.
  6. hUallachain, Breandan O & Satterthwaite, Mark A., 1992. "Sectoral growth patterns at the metropolitan level: An evaluation of economic development incentives," Journal of Urban Economics, Elsevier, vol. 31(1), pages 25-58, January.
  7. Mofidi, Alaeddin & Stone, Joe A, 1990. "Do State and Local Taxes Affect Economic Growth?," The Review of Economics and Statistics, MIT Press, vol. 72(4), pages 686-91, November.
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