Article
Variation in the heartland: Explaining the use of economic development incentives in three Great Lakes states.
Urban Affairs Review
(2021)
Abstract
We identify the factors correlated with the use of economic development incentives after the Great Recession of 2007-2009 to determine the presence of entrepreneurial development regimes. We utilize a unique dataset that combines information on incentives (tax increment financing districts and selected forms of tax abatement and business assistance) with economic, fiscal, and political characteristics for all municipalities in the largest Metropolitan Statistical Areas of Illinois, Wisconsin, and Michigan. These three states bordering Lake Michigan share similar histories and settings, thus targeting the research focus on the key attributes of interest. Our empirical results demonstrate substantial dissimilarity across states, most likely due to policy reforms at the state level and different municipal development regimes. Whereas municipalities, particularly those with more capacity, continue to use incentives to pursue jobs and economic growth, larger, revenue-rich places are more likely to use tax increment financing to pursue development strategies that are not primarily jobs-oriented.
Keywords
- economic development incentives,
- public finance,
- development regime,
- entrepreneurialism,
- recession
Disciplines
Publication Date
May 1, 2021
DOI
10.1177/1078087420928410
Citation Information
Andrea Craft, Joshua Drucker and Rachel Weber. "Variation in the heartland: Explaining the use of economic development incentives in three Great Lakes states." Urban Affairs Review Vol. 57 Iss. 3 (2021) p. 856 - 908 Available at: http://works.bepress.com/jdrucker/44/