TY  - JOUR
AU  - Glaeser,Edward L.
AU  - Gottlieb,Joshua D.
TI  - The Economics of Place-Making Policies
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 14373
PY  - 2008
Y2  - October 2008
DO  - 10.3386/w14373
UR  - http://www.nber.org/papers/w14373
L1  - http://www.nber.org/papers/w14373.pdf
N1  - Author contact info:
Edward L. Glaeser
Department of Economics
315A Littauer Center
Harvard University
Cambridge, MA 02138
Tel: 617/495-0575
Fax: 617/495-7730
E-Mail: eglaeser@harvard.edu

Joshua D. Gottlieb
Vancouver School of Economics
University of British Columbia
6000 Iona Drive
Vancouver, BC V6T 1L4
CANADA
Tel: 604/822-4121
E-Mail: joshua.gottlieb@ubc.ca
AB  - Should the national government undertake policies aimed at strengthening the economies of particular localities or regions? Agglomeration economies and human capital spillovers suggest that such policies could enhance welfare. However, the mere existence of agglomeration externalities does not indicate which places should be subsidized. Without a better understanding of nonlinearities in these externalities, any government spatial policy is as likely to reduce as to increase welfare. Transportation spending has historically done much to make or break particular places, but current transportation spending subsidizes low-income, low-density places where agglomeration effects are likely to be weakest. Most large-scale place-oriented policies have had little discernable impact. Some targeted policies such as Empowerment Zones seem to have an effect but are expensive relative to their achievements. The greatest promise for a national place-based policy lies in impeding the tendency of highly productive areas to restrict their own growth through restrictions on land use.
ER  -