Policy Versus Place Luck: Achieving Local Economic Prosperity

Abstract

This research focuses on the relative impact of place luck and economic development policy in contributing to long-term economic growth. Using a unique national data set composed of surveys of public officials, three decades of census data, and a variety of other data covering climate, health, amenities, and so on, the following research questions are addressed: (a) Is economic prosperity better explained by local development policy or simple place luck? (b) Are particular economic development policies more strongly related to prosperity than others? (c) Are there other attributes of cities such as school quality, service quality, and safety, for example, that appear to enhance economic health?

“From Coal to Cool”: The Creative Class, Social Capital, and the Revitalization of Scranton

“…While Scranton, as a small city, enjoys not having many “big city” problems, its extreme decline in the past few decades shows that, without continued investments in infrastructure, public schools and parks, neighborhoods, and (most importantly for a small city) the downtown, Scranton may lose its revitalization momentum. As Reese and Ye (2011) found in their investigation of local economic development policies, Scranton's development projects (such as KOZs or a downtown shopping mall) may not prove to foster economic regional growth or revitalize Scranton's downtown. Rather, the quality of life that Scranton offers is a major attraction to current and potential residents, in contrast to its branding as a “cool” place or as an economic center.…”

“…Quality of life investments (in schools, parks, public spaces, etc.) are also related to economic growth in city regions (Reese & Ye, 2011). So it is not surprising that in this study interviewees mentioned “quality of life” as the best aspect of living in the Scranton area.…”

Do Industrial Tax Abatements Spur Property Value Growth?

“…In order for us to identify the effect of the IFT abatement program, it is important to control for other fiscal policy influences on industrial property value growth. In the present study, we use school spending to control for other local services since research has indicated that the quality of local public schools is a particularly important factor in local economic health (Gottlieb, ; Reese & Ye, ; Wrigley & Lewis, ). We also control for the number of crimes per 1,000 to capture temporal unobservable shocks to the quality of life, which may be correlated with industrial property value growth.…”

Business starts in the Midwest: potential entrepreneurial groups

“…The creative class is attracted to areas with a higher quality of life (Florida, 2002;Reese & Ye, 2011), so areas with more natural amenities may attract more entrepreneurs. These locations may already have higher business activity (Henderson et al, 2007;Henderson & Weiler, 2010) and, thus, offer opportunities for networking and innovation.…”