Place-based economic policies see political resistance

Subject

Place-based policies.

Significance

Economic inequalities within countries are rising worldwide; the consequences are increasingly apparent in productivity, health and other indicators. Calls for place-based policymaking to tackle such inequalities are growing in the United States and elsewhere. Research into the effectiveness of such policies is limited, discouraged by their fragmented and local nature. However, what research there is shows scant evidence of net job creation or poverty reduction.

Impacts

• Supply-side policies such as retraining and fostering entrepreneurship may more successfully attract firms than demand-side incentives.
• The local nature of place-based policies will require more investment in community colleges and location-specific retraining of workers.
• The share of US workers employed in farming is falling steadily; 'rural small-town America' may disappear even with place-based policies.
• The poorest groups of society are vulnerable to COVID-19; it is likely to raise inequality and make place-based policymaking more necessary.