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American Economic Review Vol. 103 No. 2 2013

Assessing the Incidence and Efficiency of a Prominent Place Based Policy

Matí­as Busso1; Jesse Gregory2; Patrick Kline3

1 Research Department, Inter-American Development Bank, 1300 New York Avenue NW, Washington, DC 20577. · 2 Department of Economics, University of Wisconsin–Madison, 1180 Observatory Drive, Madison, WI 53706-1393. · 3 Department of Economics, University of California, Berkeley, 530 Evans Hall #3880, Berkeley, CA 94720-3880.

Abstract

This paper empirically assesses the incidence and efficiency of Round I of the federal urban Empowerment Zone (EZ) program using confidential microdata from the Decennial Census and the Longitudinal Business Database. Using rejected and future applicants to the EZ program as controls, we find that EZ designation substantially increased employment in zone neighborhoods and generated wage increases for local workers without corresponding increases in population or the local cost of living. The results suggest the efficiency costs of first Round EZs were relatively modest.

DOI
10.1257/aer.103.2.897
Volume
103
Issue
2
Pages
897-947
Language
en
Sources
openalex bibtex:phds-export.bib crossref

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