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Economic Development Assistance to Professional and Technical Services

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  • Hirasuna, Donald P.

Abstract

A computable general equilibrium model is used to compare the economic impact of subsidies between professional and technical services, high-technology manufacturing and traded services. The results suggest that the largest increase in aggregate real income is a factor tax deduction on capital to high -technology manufacturing. A factor tax deduction for the purchase of labor within professional and technical services industries increases aggregate real income in comparison to the same subsidy awarded to high-technology manufacturing or traded services. However, subsidies to either high-technology manufacturing or traded services result in increased income inequality. Only a subsidy to traded services decreases income inequality.

Suggested Citation

  • Hirasuna, Donald P., 2002. "Economic Development Assistance to Professional and Technical Services," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 32(2), pages 1-34.
    • Handle: RePEc:ags:jrapmc:132240
    DOI: 10.22004/ag.econ.132240
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    References listed on IDEAS

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    1. Bovenberg, A. Lans & Goulder, Lawrence H., 1997. "Costs of Environmentally Motivated Taxes in the Presence of Other Taxes: General Equilibrium Analyses," National Tax Journal, National Tax Association, vol. 50(1), pages 59-88, March.
    2. Hirasuna, Donald P. & Pulver, Glen C., 1998. "The Income Effects of Public Subsidies to Traded Services," The Review of Regional Studies, Southern Regional Science Association, vol. 28(3), pages 43-64, Winter.
    3. Peter J. Taylor & D.R.F. Walker, 2001. "World Cities: A First Multivariate Analysis of their Service Complexes," Urban Studies, Urban Studies Journal Limited, vol. 38(1), pages 23-47, January.
    4. Bovenberg, A. Lans & Goulder, Lawrence H., 1997. "Costs of Environmentally Motivated Taxes in the Presence of Other Taxes: General Equilibrium Analyses," National Tax Journal, National Tax Association;National Tax Journal, vol. 50(1), pages 59-88, March.
    5. Mark Horridge, 2000. "ORANI-G: A General Equilibrium Model of the Australian Economy," Centre of Policy Studies/IMPACT Centre Working Papers op-93, Victoria University, Centre of Policy Studies/IMPACT Centre.
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