The Center for Urban Studies abstracts all the articles we can find on local economic development incentives (See other abstracts).  This article is featured because it highlights the way that several economic development incentives are distributed in Ohio and the role of targeting.  Given similar manufacturing sectors, it is certainly relevant to Michigan. 

“Measuring the Distribution of Economic Development Tax Incentive Intensity”- Greenbaum, Russell, and Petras (2010)

This article looks at the characteristics which affect the distribution of the economic development incentive programs (CRA, EZ, and JTCT) in Ohio.  It focuses on whether these programs tend to meet one of the two goals of economic development incentives generally: (1) addressing efficiency concerns or (2) addressing equity concerns.  Among these, the authors focus on the issue of equity and the role that these policies play in targeting distressed areas and industries.  Using a spatial OLS model, Greenbaum et al. find that incentives are more likely to be targeted at industries as opposed to distressed areas generally.  The correlation between manufacturing’s share of employment and the distribution of economic development incentives for those programs in Ohio was .82.  However, once one controls for the number of employees, the relationship tends to show little evidence of targeting the industry.  Furthermore, controlling for the number of employees in a county, they determine that rural areas received, on average, 1.8 times as many incentives and roughly 2.4 times the value of those incentives per establishment. 

 For the full link, please visit (http://edq.sagepub.com/cgi/reprint/24/2/154)