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Do Enterprise Zone Incentives Affect Business Location Decisions?

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  • Dan Y. Dabney

    (Economic Development Administration)

Abstract

The effect of enterprise zone incentives on business location decisions has been actively debated in academic, political, and program practitioner circles. This essay concludes that financial incentives, such as tax refunds, credits, and abatements, that are offered to new businesses through enterprise zone programs only marginally affect the firm's location decision and are not a major location factor Enterprise zones generally do not fare well in classical and nontraditional location factors causing enterprise zone incentives to be unable to offset the deficiencies of major location factors in zones. Whether the enterprise zone incentives can be a pivotal factor in the location decision is highly dependent on the percentage of the financial incentive to the initial investment of the new firm.

Suggested Citation

  • Dan Y. Dabney, 1991. "Do Enterprise Zone Incentives Affect Business Location Decisions?," Economic Development Quarterly, , vol. 5(4), pages 325-334, November.
    • Handle: RePEc:sae:ecdequ:v:5:y:1991:i:4:p:325-334
    DOI: 10.1177/089124249100500404
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    Cited by:

    1. Elias Einiö & Henry G. Overman, 2016. "The (Displacement) Effects of Spatially Targeted Enterprise Initiatives: Evidence from UK LEGI," SERC Discussion Papers 0191, Centre for Economic Performance, LSE.
    2. Button, Patrick, 2019. "Do tax incentives affect business location and economic development? Evidence from state film incentives," Regional Science and Urban Economics, Elsevier, vol. 77(C), pages 315-339.
    3. Gibbons, Stephen & Overman, Henry & Sarvimäki, Matti, 2021. "The local economic impacts of regeneration projects: Evidence from UK's single regeneration budget," Journal of Urban Economics, Elsevier, vol. 122(C).
    4. Overman, Henry & Gibbons, Steve & Sarvimaki, Matti, 2017. "The local economic impacts of regeneration projects: Evidence from UK’s Single Regeneration Budget," CEPR Discussion Papers 12311, C.E.P.R. Discussion Papers.
    5. Kala Seetharam Sridhar, 2005. "Benefits and Costs of Regional Development: Evidence from Ohio’s Enterprise Zone Programme," Palgrave Macmillan Books, in: Incentives for Regional Development, chapter 5, pages 87-114, Palgrave Macmillan.
    6. Neumark, David & Kolko, Jed, 2010. "Do enterprise zones create jobs? Evidence from California's enterprise zone program," Journal of Urban Economics, Elsevier, vol. 68(1), pages 1-19, July.
    7. Peter S. Fisher, 1997. "Tax and spending incentives and enterprise zones," New England Economic Review, Federal Reserve Bank of Boston, issue Mar, pages 109-138.
    8. Raimundo Soto, "undated". "Política Fomento Empresarial y Reconversión Laboral: Experiencias Internacionales y el Caso Chileno," ILADES-UAH Working Papers inv109, Universidad Alberto Hurtado/School of Economics and Business.

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