• Economic development professionals and policymakers want to know which of their programs work best. However, a lack of data thwarts many state and local efforts to quantify incentive outcomes, hindering program evaluations.  State administrative data that is already collected from businesses -- such as tax and workforce information -- is a potential resource that can be used to conduct these evaluations.   To figure out how to use this resource, the National Governors Association teamed with the Center for Regional Economic Competitiveness to offer a webinar on "State Data Sharing to Support Economic and...

  • Smart incentive use begins with good upfront due diligence on recipients and proposed investments. This post provides a quick refresher on why it is important to conduct background research on incentive applicants and the essential steps in the process. Problem prospects can drag down economic development efforts, but due diligence on companies seeking incentives can help economic development organizations: reduce risk refine strategies and recommendations identify conflicts of interest or past legal problems improve accountability to stakeholders If you are considering offering incentives to a company, here is what you...

  • State economic development leaders have embraced the need to report program outcomes to demonstrate the impact of their efforts but seek better indicators to measure those outcomes. A new paper from the Center for Regional Economic Competitiveness, Redefining Economic Development Performance Indicators for a Field in Transition, identifies a set of metrics beyond jobs and investment tallies to capture the broader benefits of economic development initiatives. This effort reflects an ongoing transition within economic development as the field moves from a recession-driven emphasis on job creation via business attraction and retention...

  • States “have made progress in gathering evidence on the results of their economic development tax incentives,” but challenges remain for policy leaders seeking to understand and improve economic development outcomes. Ellen Harpel of Smart Incentives and Josh Goodman from The Pew Charitable Trusts discussed “Evaluating and Improving Tax Incentives” as part of the Lincoln Institute of Land Policy’s seminar on Economic Perspectives on State and Local Taxes. Goodman presented Pew’s latest report on the subject, How States Are Improving Tax Incentives for Jobs and Growth. 27 states and the District...

  • A new report from the Urban Institute assesses how the synthetic control method can be used for economic development policy evaluation. The synthetic control method (SCM) creates “a synthetic control region that simulates what the outcome path of a region would be if it did not undergo a particular policy intervention.” The method involves creating a “hypothetical counterfactual region” based on combined predictor variables from specified “donor regions” – such as other states – and comparing outcome variables. It is considered a useful quantitative supplement to qualitative case studies because...