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Geographic Redistribution of the U.S. Manufacturing and The Role of State Development Policy

March 2007

Written by: Yoonsoo Lee

Working Paper Number:

CES-07-06

Abstract

Competition among state and local governments to lure businesses has attracted considerable interest from economists, as well as legislators and policy makers. This paper quantifies the role of plant relocations in the geographic redistribution of manufacturing employment and examines the effectiveness of state development policy. Only a few studies have looked at how manufacturing firms locate their production facilities geographically; they have used either small manufacturing samples or small geographic regions. This paper provides broader evidence of the impact of plant relocations using confidential establishment level data from the U.S. Census Longitudinal Research Database (LRD), covering the full population of manufacturing establishments in the United States over the period from 1972 to 1992. This paper finds a relatively small role for relocation in explaining the disparity of manufacturing employment growth rates across states. Moreover, it finds evidence of very weak effects of incentive programs on plant relocations.

Document Tags and Keywords

Keywords Keywords are automatically generated using KeyBERT, a powerful and innovative keyword extraction tool that utilizes BERT embeddings to ensure high-quality and contextually relevant keywords.

By analyzing the content of working papers, KeyBERT identifies terms and phrases that capture the essence of the text, highlighting the most significant topics and trends. This approach not only enhances searchability but provides connections that go beyond potentially domain-specific author-defined keywords.
:
manufacturing, midwest, state, regional, estimates employment, incorporated, employment estimates, location, metropolitan, relocating, economically, region, industries estimate, geographically, city, relocation, suburb, state employment, relocate

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:
Census of Manufactures, Annual Survey of Manufactures, Longitudinal Research Database, National Science Foundation, Center for Economic Studies, Federal Reserve Bank, Census Bureau Longitudinal Business Database, Federal Reserve System, Chicago Census Research Data Center, Special Sworn Status

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