The Effect of Location Based Tax Incentives on Establishment Location and Employment Across Industry Sectors

Authors

Andrew Hanson, Marquette UniversityFollow
Shawn Rohlin, Kent State UniversityFollow

Document Type

Article

Language

eng

Format of Original

35 p.

Publication Date

2011

Publisher

SAGE Publications

Source Publication

Public Finance Review

Source ISSN

1091-1421

Abstract

This article examines the potential for location-based employment tax incentives to have a differential effect on establishment location and employment across industry sectors. The authors model the differential effect of the location-based federal Empowerment Zone (EZ) wage tax credit on equilibrium labor and total cost savings across industry sectors. The model guides the empirical work, as the authors test the effect of the program across industry sectors. The empirical analysis shows that location-based tax incentives have a positive effect on firm location in some of the industries their model predicts and a negative effect in industries that could be crowded out.

Comments

Accepted version. Public Finance Review, Vol. 39, No. 2 (2011): 191-225. DOI. © 2011 Sage Publications. Used with permission.

Andrew Hanson was affiliated with the Georgia State University at the time of publication.

Recommended Citation

Hanson, Andrew and Rohlin, Shawn, "The Effect of Location Based Tax Incentives on Establishment Location and Employment Across Industry Sectors" (2011). Economics Faculty Research and Publications. 200.
https://epublications.marquette.edu/econ_fac/200