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- Title
A Cost-Benefit Analysis of Location Subsidies for Ghetto Neighborhoods.
- Authors
Tabb, William K.
- Abstract
The purpose of this article is to study a method of dealing with minority unemployment in the urban core, namely, tax incentives to private firms to locate enterprises in urban poverty areas. If location incentives succeeded in attracting low wage sweatshop employment, the program would do little to alleviate urban property. This proposed program seeks to create jobs for poverty-area unemployed. Such people have had little training and poor labor force experience. The expected life of the firm, the number of jobs, future wage rates, are all difficult to estimate and choosing a discount rate necessitates value judgments which may have important effects on the results. Location within urban poverty areas runs counter to strong market forces which have led to suburbanization of manufacturing and economic activity in the postwar period. Economic opportunity for all should mean opportunity in the growth areas of economy, not in marginal employment in the economic backwaters. Without sizeable subsidies investment, a ghetto location is at best a highly risky undertaking.
- Subjects
UNITED States; EMPLOYMENT subsidies; INNER cities; TAX incentives; COST effectiveness; PUBLIC welfare; GOVERNMENT aid; COMMUNITY support; VALUE engineering
- Publication
Land Economics, 1972, Vol 48, Issue 1, p45
- ISSN
0023-7639
- Publication type
Article
- DOI
10.2307/3145638