Does Tax Increment Financing Pass the “But-for” Test in Missouri?
El-Khattabi, Ahmed Rachid
Does Tax Increment Financing Pass the “But-for” Test in Missouri? - Sage, 2019. - Vol. 33, Issue 3, 2019;(187-202 p.)
The use of tax increment financing (TIF) remains a popular, yet highly controversial, tool among policy makers in their efforts to promote economic development. This study conducts a comprehensive assessment of the effectiveness of Missouri’s TIF program, specifically in Kansas City and St. Louis, in creating economic opportunities. We build a time-series data set starting 1990 through 2012 of detailed employment levels, establishment counts, and sales at the census block-group level to run a set of difference-in-differences with matching estimates for the impact of TIF at the local level. Although we analyze the impact of TIF on a wide set of indicators and across various industry sectors, we find no conclusive evidence that the TIF program in either city has a causal impact on key economic development indicators.
tax increment financing,
economic development incentives,
economic impact
Does Tax Increment Financing Pass the “But-for” Test in Missouri? - Sage, 2019. - Vol. 33, Issue 3, 2019;(187-202 p.)
The use of tax increment financing (TIF) remains a popular, yet highly controversial, tool among policy makers in their efforts to promote economic development. This study conducts a comprehensive assessment of the effectiveness of Missouri’s TIF program, specifically in Kansas City and St. Louis, in creating economic opportunities. We build a time-series data set starting 1990 through 2012 of detailed employment levels, establishment counts, and sales at the census block-group level to run a set of difference-in-differences with matching estimates for the impact of TIF at the local level. Although we analyze the impact of TIF on a wide set of indicators and across various industry sectors, we find no conclusive evidence that the TIF program in either city has a causal impact on key economic development indicators.
tax increment financing,
economic development incentives,
economic impact