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Using Place-Based Jobs Policies to Help Distressed Communities

Using Place-Based Jobs Policies to Help Distressed Communities AbstractPlace-based jobs policies seek to create jobs in particular local labor markets. Such policies include business incentives provided by state and local governments, which cost almost $50 billion annually. The most persuasive rationale for these policies is that they can advance equity and efficiency by increasing long-term employment rates in distressed local labor markets. However, current incentives are not targeted at distressed areas. Furthermore, incentives have high costs per job created. Lower costs can be achieved by public services to business, such as manufacturing extension, customized job training, and infrastructure. Reforms to place-based jobs policies should focus on greater targeting of distressed areas and using more cost-effective policies. Such reforms could be achieved by state and local governments acting in their residents’ interests or could be encouraged by federal interventions to cap incentives and provide aid to distressed areas. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Economic Perspectives American Economic Association

Using Place-Based Jobs Policies to Help Distressed Communities

Bartik, Timothy J.
Journal of Economic Perspectives , Volume 34 (3) – Aug 1, 2020
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Publisher
American Economic Association
Copyright
Copyright © 2020 © American Economic Association
ISSN
0895-3309
DOI
10.1257/jep.34.3.99
Publisher site
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Abstract

AbstractPlace-based jobs policies seek to create jobs in particular local labor markets. Such policies include business incentives provided by state and local governments, which cost almost $50 billion annually. The most persuasive rationale for these policies is that they can advance equity and efficiency by increasing long-term employment rates in distressed local labor markets. However, current incentives are not targeted at distressed areas. Furthermore, incentives have high costs per job created. Lower costs can be achieved by public services to business, such as manufacturing extension, customized job training, and infrastructure. Reforms to place-based jobs policies should focus on greater targeting of distressed areas and using more cost-effective policies. Such reforms could be achieved by state and local governments acting in their residents’ interests or could be encouraged by federal interventions to cap incentives and provide aid to distressed areas.

Journal

Journal of Economic Perspectives – American Economic Association

Published: Aug 1, 2020

References