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Local employment multipliers for large publicly subsidized firms: Evidence from a synthetic control approach

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  • Andrew Hanson
  • Shawn Rohlin

Abstract

This paper provides estimates of local employment multipliers from large, publicly subsidized firms. We use a synthetic control weighted difference‐in‐difference estimation procedure that matches treated areas with comparison areas to generate local employment multiplier estimates. We show that local employment multiplier estimates have a high degree of uncertainty, with a wide range of point estimates (both positive and negative) and varying degrees of statistical significance. There is a concentration of positive employment multipliers from manufacturing facilities, but little correlation between estimated multipliers and subsidy value. We demonstrate that our approach produces drastically different results than a traditional difference‐in‐difference approach.

Suggested Citation

  • Andrew Hanson & Shawn Rohlin, 2024. "Local employment multipliers for large publicly subsidized firms: Evidence from a synthetic control approach," Journal of Regional Science, Wiley Blackwell, vol. 64(2), pages 491-526, March.
    • Handle: RePEc:bla:jregsc:v:64:y:2024:i:2:p:491-526
    DOI: 10.1111/jors.12680
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    References listed on IDEAS

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