Targeted Economic Incentives: An Analysis of State Fiscal Policy and Regulatory Conditions

33 Pages Posted: 26 Apr 2018 Last revised: 14 Sep 2018

See all articles by Peter Calcagno

Peter Calcagno

College of Charleston - Department of Economics

Frank L Hefner

College of Charleston - Department of Economics

Date Written: February 28, 2018

Abstract

Economic development incentives by state and local governments have been shown to have little positive economic effect on employment or growth. Using a political economy approach, we investigate the characteristics associated with fiscal conditions and public policies within a state. Using data from 1993 to 2014 from Good Jobs First, we employ a Poisson model to investigate whether states with budget issues, high tax and regulatory burdens, and poorly trained labor are offering targeted incentives to potentially offset costly economic conditions. Our results indicate that unemployment rates, fiscal policy conditions, and individual income tax burden explain the granting of targeted incentives.

Keywords: State Economic Incentives, State Taxes, Targeted Incentives, State Economic Development, State Fiscal Policy

JEL Classification: H25, H71, D72

Suggested Citation

Calcagno, Peter and Hefner, Frank L, Targeted Economic Incentives: An Analysis of State Fiscal Policy and Regulatory Conditions (February 28, 2018). Mercatus Working Paper, Available at SSRN: https://ssrn.com/abstract=3169394 or http://dx.doi.org/10.2139/ssrn.3169394

Peter Calcagno (Contact Author)

College of Charleston - Department of Economics ( email )

66 George Street
Charleston, SC 29424
United States

Frank L Hefner

College of Charleston - Department of Economics ( email )

5 Liberty Street
Charleston, SC 29401
United States
+1 843 953 8111 (Phone)

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
160
Abstract Views
1,181
rank
253,394
PlumX Metrics