Industrial Incentives: Competition Among American States and Cities

Attracting private investment to contaminated properties: The value of public interventions

“…For example, early statistical and econometric work that suggested no or very modest impact on location decisions from tax incentives (Due, 1961;Greenhut, 1956;Oakland, 1974) has been challenged by later studies that suggested a statistically significant, positive relationship between tax incentives and regional and local growth and property values (Bartik, 1991;Greenstone & Moretti, 2003;Newman & Sullivan, 1988;Wasylenko, 1997). However, while such studies demonstrate that individual firms may respond to incentives, researchers continue to question the practical-as opposed to merely statistical-significance of the estimated relationship between tax enterprise zones, tax increment financing and other incentives, and overall economic gains in targeted areas (Fisher & Peters, 1998;Fox & Murray, 2004;McGuire, 1992;Peters & Fisher, 2002). This work points out that the relationships are inconsistent across regions, time, industry focus, and incentive type.…”

The Failures of Economic Development Incentives

“…Unsurprisingly, the results have been mixed, and no clear picture has emerged. Those finding a link between economic problems and the vigor of the economic development effort have used a variety of methods (Atkinson, 1991;Bowman, 1987;Clarke, 1986;Clingermayer & Feiock, 1990;Cray & Lowery, 1990;Creen & Fleischman, 1991), as have those finding little or no relationship (Fisher & Peters, 1998;Crady, 1987;Hanson, 1993;Peters & Fisher, 2002b;Reese, 1991;Sridhar, 1996). The more recent studies have paid closer attention to measurement and model specification issues, and it is possible that these studies-which find little or no relationship-are thus more reliable.…”

The Property Tax as a Tax on Value: Deadweight Loss

“…8. Fisher and Peters (1998), Table 3, provides data on the lowest and highest effective property tax rates in 1992 for a sample of cities within a state, for a selection of states. Indiana's figures are 3.72%, 4.39%; Iowa's 4.23%, 4.68%; and Minnesota's 4.81%, 5.30%.…”