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Job creation tax credits and job growth: whether, when, and where?

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  • Robert S. Chirinko
  • Daniel J. Wilson

Abstract

This paper studies the effects of Job Creation Tax Credits (JCTCs) enacted by U.S. states over the past 20 years. First, we investigate whether JCTCs stimulate within-state job growth. Second, we assess from where any increased employment comes from ? in-state or out-of-state? Third, we evaluate when JCTCs' effects occur. In particular, we test for negative anticipation effects between JCTC enactment and when legislation goes into effect. We investigate these questions using a difference-in-differences estimator applied to monthly panel data on employment, the JCTC value, the JCTC effective and legislative dates, and various controls.

Suggested Citation

  • Robert S. Chirinko & Daniel J. Wilson, 2010. "Job creation tax credits and job growth: whether, when, and where?," Working Paper Series 2010-25, Federal Reserve Bank of San Francisco.
    • Handle: RePEc:fip:fedfwp:2010-25
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    References listed on IDEAS

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    Cited by:

    1. Button, Patrick, 2019. "Do tax incentives affect business location and economic development? Evidence from state film incentives," Regional Science and Urban Economics, Elsevier, vol. 77(C), pages 315-339.
    2. repec:hal:spmain:info:hdl:2441/4bckbd1dtk8jdp1dnjedlgofe2 is not listed on IDEAS
    3. Timothy J. Bartik & George A. Erickcek, 2012. "Simulating the Effects of Michigan's MEGA Tax Credit Program on Job Creation and Fiscal Benefits," Upjohn Working Papers 12-185, W.E. Upjohn Institute for Employment Research.
    4. Moretti, Enrico & Wilson, Daniel J., 2014. "State incentives for innovation, star scientists and jobs: Evidence from biotech," Journal of Urban Economics, Elsevier, vol. 79(C), pages 20-38.
    5. Kenneth A. Couch & Douglas J. Besharov & David Neumark, 2013. "Spurring Job Creation in Response to Severe Recessions: Reconsidering Hiring Credits," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 32(1), pages 142-171, January.
    6. Diego Grijalva & David Neumark, 2014. "State hiring credits and recent job growth," FRBSF Economic Letter, Federal Reserve Bank of San Francisco.
    7. Garsous, Grégoire & Corderi, David & Velasco, Mercedes & Colombo, Andrea, 2017. "Tax Incentives and Job Creation in the Tourism Sector of Brazil’s SUDENE Area," World Development, Elsevier, vol. 96(C), pages 87-101.
    8. David Neumark & Diego Grijalva, 2013. "The Employment Effects of State Hiring Credits During and After the Great Recession," NBER Working Papers 18928, National Bureau of Economic Research, Inc.
    9. Emefa Sewordor & David L. Sjoquist, 2016. "Lights, Camera, Action: The Adoption of State Film Tax Credits," Public Budgeting & Finance, Wiley Blackwell, vol. 36(2), pages 5-25, June.
    10. Pierre Cahuc & Stéphane Carcillo & Thomas Le Barbanchon, 2014. "Do Hiring Credits Work in Recessions?: Evidence from France," Sciences Po publications 8330, Sciences Po.

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    Keywords

    Tax credits; Tax incentives; Public policy;
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