Spillover, Efficiency, and Equity Effects of Regional Firm SubsidiesIndian Rupee

• 成果类型: Article
• 署名作者: Siegloch, Sebastian; Wehrhoefer, Nils; Etzel, Tobias
• 署名单位: University of Cologne; Leibniz Association; Zentrum fur Europaische Wirtschaftsforschung (ZEW); Deutsche Bundesbank
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.20220667
• 发表日期: 2025
• 页码: 144-180
• 关键词: regression discontinuity design; local economic-development; Place-based policies; INVESTMENT; GROWTH; determinants; state; jobs

摘要

We analyze the effects of a large place-based policy, subsidizing up to 50 percent of the investment costs of East German manufacturing plants. We show that a 1 percentage point decrease in subsidy rate leads to a 1 percent decrease in manufacturing employment. We document important local spillovers for the untreated construction and retail sectors, counties connected via trade, and local tax rates. There is no evidence for regional reallocation, within-irm spillover, or changes in commuting and residential decisions. The cost per job amounts to about $19,000. We show local subsidies are substantially more effective in curbing regional inequality than place-blind policies. (JEL G31, H71, L60, L74, L81, R23, R51)