Industrial recruitment is often portrayed by economic development scholars as an inferior or 'second-best' strategy to those that promote 'home-grown' enterprise. But this characterization overlooks improvements to industry recruitment that state and local agencies have adopted in recent decades and the underlying factors that contribute to this effort. Drawing on two case studies of strategic industrial recruitment in the U.S. South, this paper makes the case for industrial recruitment as embedded practice-rooted in placespecific contexts, adaptive and open to change, and governed by a range of institutional actors. The result is both a more strategic approach to local industrial recruitment, and also one designed to complement-not undermine-other local economic development practices.
State incentive granting for the purpose of firm retention or recruitment remains highly controversial and is often portrayed as antithetical to long-range economic development planning. This article uses quasi-experimental methods to measure the impact of state-level economic development incentives on employment growth at the establishment level in North Carolina. Using North Carolina's rich history of strategic planning and sector-based economic development as a backdrop, the authors develop a theory of sectoral "mediation." This enables the authors to compare the effectiveness of incentives offered in mediated and nonmediated industries and show that when incentives are coupled with sectoral economic development efforts they generate substantially stronger employment effects than at establishments with limited sector-based institutional support.
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ABSTRACTState incentive granting for the purpose of firm retention or recruitment remains highly controversial and is often portrayed as antithetical to long-range economic development planning. This paper uses quasi-experimental methods to measure the impact of state-level economic development incentives on employment growth at the establishment level in North Carolina. Using North Carolina's rich history of strategic planning and sector-based economic development as a backdrop, we develop a theory of sectoral "mediation." This enables us to compare the effectiveness of incentives offered in mediated and nonmediated industries and show that when incentives are coupled with sectoral economic development efforts they generate substantially stronger employment effects than at establishments with limited sector-based institutional support.JEL Classification Codes: O20, O25, O43, R58
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