Aerospace Place-Based Policy: The Impact of Boeing on South Carolina's Aerospace Industry

Abstract

South Carolina offered Boeing nearly $1 billion to locate a 787 Dreamliner assembly plant in North Charleston, which opened in 2011. Using difference-in-differences and synthetic difference-in-differences estimators, the author finds a substantial impact of the plant on South Carolina's aerospace employment (311% or 6,000 jobs), wages (10%), and establishments (44%) in the subsequent decade. The estimated number of aerospace jobs generated by the plant exceeds Boeing's 3,800 promised jobs. However, much of the state's aerospace establishment growth does not appear to be directly related to the Boeing plant, with most of it occurring in the upstate region (Greenville, Spartanburg) late in the treatment period. An analysis of the Charleston metropolitan area's economy reveals a 5-year local employment multiplier of 2.6 per promised job.

Keywords

aerospace manufacturing location choice regional economic development

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