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Do Business Tax Incentives Contribute to a Divergence in Economic Growth?

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  • Ernest P. Goss

    (Creighton University)

  • Joseph M. Phillips

    (Creighton University)

Abstract

A lack of detailed data on state tax incentive programs has limited the assessment of their economic impacts. However, in 1987, the Nebraska legislature, as part of its new business tax incentive initiative, required that the state Department of Revenue collect data on all business tax incentive agreements and report findings yearly. Nebraska’s legislative mandate produced a unique data set for assessing the impact of a business tax incentive program. Using these data, this article evaluates business tax incentives across Nebraska’s 93 counties during 1987 to 1995 and concludes that qualifying business investment (a) had a positive and statistically significant impact on economic growth for low-unemployment counties, (b) had no statistically significant impact on economic growth for high-unemployment counties, and (c) tended to be undertaken in areas with historically higher investment activity, thus contributing to greater economic performance differences among counties in the state.

Suggested Citation

  • Ernest P. Goss & Joseph M. Phillips, 1999. "Do Business Tax Incentives Contribute to a Divergence in Economic Growth?," Economic Development Quarterly, , vol. 13(3), pages 217-228, August.
    • Handle: RePEc:sae:ecdequ:v:13:y:1999:i:3:p:217-228
    DOI: 10.1177/089124249901300302
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    References listed on IDEAS

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    3. Denys Nizalov, 2011. "The Effect of Municipal Strategic Planning on Urban Growth in Ukraine," ERSA conference papers ersa10p1168, European Regional Science Association.
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    5. Necmettin CELIK, 2017. "Tesvik Politikalarinin Etkinliginin Mekansal Perspektiften Degerlendirilmesi," Ege Academic Review, Ege University Faculty of Economics and Administrative Sciences, vol. 17(1), pages 1-12.
    6. Oscar A. Alfonso Roa, 2014. "Los desequilibrios territoriales en Colombia. Estudios sobre el sistema de ciudades y el polimetropolitanismo," Books, Universidad Externado de Colombia, Facultad de Economía, edition 1, volume 1, number 67.
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    9. Fuerst, Franz & Mollenkopf, John, 2005. "Are Local Economic Development Incentives Promoting Job Growth? An Empirical Case Study," MPRA Paper 11444, University Library of Munich, Germany.

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