NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Do Enterprise Zones Create Jobs? Evidence from California's Enterprise Zone Program

David Neumark, Jed Kolko

NBER Working Paper No. 14530*
Issued in December 2008
NBER Program(s):   LS    PE

We use new establishment-level data and geographic mapping methods to improve upon evaluations of the effectiveness of state enterprise zones, focusing on California’s program. Because zone boundaries do not follow census tracts or zip codes, we created digitized maps of original zone boundaries and later expansions. We combine these maps with geocoded observations on most businesses located in California. The evidence indicates that enterprise zones do not increase employment. We also find no shift of employment toward the lower-wage workers targeted by enterprise zone incentives. We conclude that the program is ineffective in achieving its primary goals.

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This paper was revised on January 7, 2010

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