Job Growth from Opportunity Zones

Arefeva, Alina; Davis, Morris A.; Ghent, Andra C.; Park, Minseon

doi:10.2139/ssrn.3645507

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Job Growth from Opportunity Zones

54 Pages Posted: 4 Aug 2020 Last revised: 2 Feb 2021

See all articles by Alina Arefeva

Andra C. Ghent

University of Utah - David Eccles School of Business

Minseon Park

University of Wisconsin - Madison - Univeristy of Wisconsin-Madison

Date Written: February 1, 2021

Abstract

The Tax Cuts and Jobs Act of 2017 established a new program called Opportunity Zones (OZs) that created tax advantages for investing in businesses or real estate in a limited number of low-income Census tracts. We use a census of establishment-level data on employment to identify the effect of the program on job creation. We show that in metropolitan areas, the OZ designation increased employment growth relative to comparable tracts by between 3.0 and 4.5 percentage points and new jobs were created across many different industries and education levels. The OZ designation did not create jobs in rural areas.

Keywords: Placed-Based Policies, Opportunity Zones, Tax Incentives

JEL Classification: H73, R30, R38, G11, G18

Suggested Citation: Suggested Citation

Arefeva, Alina and Davis, Morris A. and Ghent, Andra C. and Park, Minseon, Job Growth from Opportunity Zones (February 1, 2021). Available at SSRN: https://ssrn.com/abstract=3645507 or http://dx.doi.org/10.2139/ssrn.3645507