TY - JOUR AU - Austin, Benjamin A AU - Glaeser, Edward L AU - Summers, Lawrence H TI - Jobs for the Heartland: Place-Based Policies in 21st Century America JF - National Bureau of Economic Research Working Paper Series VL - No. 24548 PY - 2018 Y2 - April 2018 DO - 10.3386/w24548 UR - http://www.nber.org/papers/w24548 L1 - http://www.nber.org/papers/w24548.pdf N1 - Author contact info: Benjamin A. Austin Department of Economics Littauer Center Harvard University Cambridge, MA 02138 E-Mail: benjamin_austin@g.harvard.edu 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 Lawrence H. Summers Harvard Kennedy School of Government 79 JFK Street Cambridge, MA 02138 Tel: 617/495-9322 Fax: 617/495-0436 E-Mail: lhs@harvard.edu AB - The economic convergence of American regions has greatly slowed, and rates of long-term non-employment have even been diverging. Simultaneously, the rate of non-employment for working age men has nearly tripled over the last 50 years, generating a terrible social problem that is disproportionately centered in the eastern parts of the American heartland. Should more permanent economic divisions across space lead American economists to rethink their traditional skepticism about place-based policies? We document that increases in labor demand appear to have greater impacts on employment in areas where not working has been historically high, suggesting that subsidizing employment in such places could particularly reduce the not working rate. Pro-employment policies, such as a ramped up Earned Income Tax Credit, that are targeted towards regions with more elastic employment responses, however financed, could plausibly reduce suffering and materially improve economic performance. ER -