Does Government Play Favorites? Evidence from Opportunity Zones

70 Pages Posted: 15 Oct 2019 Last revised: 2 Sep 2020

See all articles by Ofer Eldar

Ofer Eldar

Duke University School of Law; Duke University - Fuqua School of Business; Duke Innovation & Entrepreneurship Initiative

Chelsea Garber

Duke University - Department of Economics

Date Written: September 1, 2020

Abstract

In 2017, Congress introduced the Opportunity Zone (``OZ'') designation to promote development in distressed communities. A criticized feature of the program is that state governors select zones from many eligible tracts without meaningful scrutiny. We find that while governors are more likely to select tracts with higher distress levels and tracts on an upward economic trajectory, favoritism seems to play an important role in governor decisions. OZ designation is more likely for tracts in counties that supported the governor in the election and when executives or firms with an economic interest in the tract donated to the governor's campaign.

Keywords: Opportunity Zones, Development, Administrative Discretion, Social Entrepreneurship, Taxation, Subsidies

JEL Classification: O2, H1, O34

Suggested Citation

Eldar, Ofer and Garber, Chelsea, Does Government Play Favorites? Evidence from Opportunity Zones (September 1, 2020). Duke Law School Public Law & Legal Theory Series No. 2020-28, Available at SSRN: https://ssrn.com/abstract=3463541 or http://dx.doi.org/10.2139/ssrn.3463541

Ofer Eldar (Contact Author)

Duke University School of Law ( email )

210 Science Drive
Box 90362
Durham, NC 27708
United States

Duke University - Fuqua School of Business ( email )

Box 90120
Durham, NC 27708-0120
United States

Duke Innovation & Entrepreneurship Initiative ( email )

215 Morris St., Suite 300
Durham, NC 27701
United States

Chelsea Garber

Duke University - Department of Economics ( email )

213 Social Sciences Building
Box 90097
Durham, NC 27708-0204
United States

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