Combining rich firm and administrative data, this paper examines the incidence and effectiveness of a prominent place-based policy in China: special economic zones. Establishing zones is found to have had a positive effect on capital investment, employment, output, productivity, and wages, and to have increased the number of firms in the designated areas. Net entry plays a larger role in generating those effects than incumbents. The special zone program's net benefits over three years are estimated to amount to about US$15.62 billion. Capital-intensive industries benefit more than labor-intensive ones from the zone programs.
Lu, Yi, Jin Wang, and Lianming Zhu.
"Place-Based Policies, Creation, and Agglomeration Economies: Evidence from China's Economic Zone Program."
American Economic Journal: Economic Policy,
Economic Development: Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
Economic Development: Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
Socialist Systems and Transitional Economies: Urban, Rural, and Regional Economics
Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics
Other Spatial Production and Pricing Analysis
Regional Development Planning and Policy