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Do unemployed workers benefit from enterprise zones? The French experience

  • Gobillon, Laurent
  • Magnac, Thierry
  • Selod, Harris

This paper is a statistical evaluation of the 1997 enterprise zone program in France. We investigate whether the program increased the pace at which unemployed workers residing in targeted municipalities and surrounding areas find employment. The work relies on a two- stage analysis of unemployment spells drawn from an exhaustive dataset over the 1993-2003 period in the Paris region. We first estimate a duration model stratified by municipalities in order to recover semester-specific municipality effects net of individual observed heterogeneity. These effects are estimated both before and after the implementation of the program, allowing us to construct variants of difference-in-difference estimators of the impact of the program at the municipality level. Following extensive robustness checks, we conclude that enterprise zones have a very small but significant effect on the rate at which unemployed workers find a job. The effect remains localized and is shown to be significant only in the short run.

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Paper provided by Toulouse School of Economics (TSE) in its series TSE Working Papers with number 10-201.

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Date of creation: 25 Oct 2010
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Publication status: Published in Journal of Public Economics, vol.�96, n°9-10, octobre 2012, p.�881-892.
Handle: RePEc:tse:wpaper:23525
Contact details of provider: Phone: (+33) 5 61 12 86 23
Web page: http://www.tse-fr.eu/

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  1. Bondonio, Daniele & Engberg, John, 2000. "Enterprise zones and local employment: evidence from the states' programs," Regional Science and Urban Economics, Elsevier, vol. 30(5), pages 519-549, September.
  2. Gobillon, Laurent & Magnac, Thierry & Selod, Harris, 2007. "The Effect of Location on Finding a Job in the Paris Region," IDEI Working Papers 433, Institut d'Économie Industrielle (IDEI), Toulouse, revised Mar 2009.
  3. Raphael W. Bostic & Allen C. Prohofsky, 2006. "Enterprise Zones and Individual Welfare: A Case Study of California," Journal of Regional Science, Wiley Blackwell, vol. 46(2), pages 175-203.
  4. Gobillon, Laurent & Magnac, Thierry & Selod, Harris, 2012. "Do Unemployed Workers Benefit from Enterprise Zones? The French Experience," IZA Discussion Papers 6357, Institute for the Study of Labor (IZA).
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  10. Hanson, Andrew, 2009. "Local employment, poverty, and property value effects of geographically-targeted tax incentives: An instrumental variables approach," Regional Science and Urban Economics, Elsevier, vol. 39(6), pages 721-731, November.
  11. O'Keefe, Suzanne, 2004. "Job creation in California's enterprise zones: a comparison using a propensity score matching model," Journal of Urban Economics, Elsevier, vol. 55(1), pages 131-150, January.
  12. Sylvie Blasco & François Fontaine, 2010. "Étudier le non-recours à l'assurance chômage," Revue économique, Presses de Sciences-Po, vol. 61(5), pages 933-943.
  13. Richard Blundell & Monica Costa Dias & Costas Meghir & John Van Reenen, 2001. "Evaluating the employment impact of a mandatory job search assistance program," IFS Working Papers W01/20, Institute for Fiscal Studies.
  14. James J. Heckman, 1989. "Choosing Among Alternative Nonexperimental Methods for Estimating the Impact of Social Programs: The Case of Manpower Training," NBER Working Papers 2861, National Bureau of Economic Research, Inc.
  15. 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.
  16. Blundell, Richard William & Costa Dias, Monica & Meghir, Costas & Van Reenen, John, 2003. "Evaluating the Employment Impact of a Mandatory Job Search Programme," CEPR Discussion Papers 3786, C.E.P.R. Discussion Papers.
  17. Patrick Sillard & Roland Rathelot, 2008. "Zones Franches Urbaines : quels effets sur l'emploi salarié et les créations d'établissements ?," Économie et Statistique, Programme National Persée, vol. 415(1), pages 81-96.
  18. Boarnet, Marlon G. & Bogart, William T., 1996. "Enterprise Zones and Employment: Evidence from New Jersey," Journal of Urban Economics, Elsevier, vol. 40(2), pages 198-215, September.
  19. Mauer, David C. & Ott, Steven H., 1999. "On the Optimal Structure of Government Subsidies for Enterprise Zones and Other Locational Development Programs," Journal of Urban Economics, Elsevier, vol. 45(3), pages 421-450, May.
  20. Heckman, James J & Ichimura, Hidehiko & Todd, Petra E, 1997. "Matching as an Econometric Evaluation Estimator: Evidence from Evaluating a Job Training Programme," Review of Economic Studies, Wiley Blackwell, vol. 64(4), pages 605-54, October.
  21. 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.
  22. 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.
  23. Cynthia L. Rogers & Jill L. Tao, 2004. "Quasi-Experimental Analysis of Targeted Economic Development Programs: Lessons from Florida," Economic Development Quarterly, , vol. 18(3), pages 269-285, August.
  24. Peter S. Fisher, 1997. "Tax and spending incentives and enterprise zones," New England Economic Review, Federal Reserve Bank of Boston, issue Mar, pages 109-138.
  25. 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.
  26. Joel A. Elvery, 2009. "The Impact of Enterprise Zones on Resident Employment," Economic Development Quarterly, , vol. 23(1), pages 44-59, February.
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