An Examination of the Effect of Taxation as An Incentive in Revitalizing Urban Local Economic Development in Elizabeth,New Jersey

Abstract

This paper examines the relationship between business climate (tax incentives) and economic development in Elizabeth, New Jersey. Its purpose is to understand how the city uses taxation as an incentive in its local economic development policy to revitalize the city and to explore the policy implications for urban revitalization. the research consists of two parts: (1) analyses of qualitative data on business climate and (2) a face to face interview with the mayor. the findings have important policy implications because they provide evidence to support the bureaucratic decisions to pursue tax policies in economic development planning. the findings, consistent with prior research, suggest that (1) people, not jobs, are the driving force in economic development, and (2) economic revitalization may be less a function of the level of taxes in place and more a function of the proper mix of taxes and their relationship to economic development.

Get full access to this article

View all access options for this article.

References

Anderson

J.E.

and Wassmer

R.W

. (2000). Bidding for Business: the Efficacy of Local Economic Development Incentives in a Metropolitan Area. W.E. Upjohn Institute for Employment Research, Kalamazoo, MI.

Bartlett

C.A.

and Mohammed

(1995). 3M: Profile of an innovating company. Case No. N9-395-016. Boston: Harvard Business School Case Services.

Beckett-Camarata

E.J

. (1998). An Empirical Investigation of the Effect of Strategic Planning on Financial Performance. Virginia Commonwealth University: Unpublished Ph.D. dissertation.

Bowman

O'M. (1986). Competition for Economic Development among Southeastern Cities. Urban Affairs Quarterly 1: 72–85.

Chaskin

R.J.

and Abunimah

(1999). A view from the city: local government perspectives on neighborhood-based governance in community-building initiatives. Journal of Urban Affairs 21: 51–57.

Coleman

J.S

. (1992). The rational reconstruction of society. American Sociological Review, 58: 1–15.

Donaldson

& Lorsch

J.W

. (1983). Decision Making at the Top: the Shaping of Strategic Direction. New York: Basic Books.

Doss

C.B

. (1987). The use of Capital Budgeting Procedures in U.S. Cities. Public Budgeting and Finance 7 (3) Autumn: 57–69.

Fernandez

P.P.

and Laberge

M.P

. (1986). Setting Local Government Priorities through the Budget Process. Government Finance Review 1–2: 21–27.

10.

Feiock

R.C

. (1991). The Effects of Economic Development Policy on Local Economic Growth. American Journal of Political Science, Vol. 35, Issue 3 (August), 643–655.

11.

Green

G.P.

and Fleishman

(1989). Analyzing Local Strategies for Promoting Economic Development. Policies Studies Journal 17 (3) Spring 1989: 557–573.

12.

Karlof

(1993). Strategic Precision: Improving Performance Through Organizational Efficiency. Chichester: John Wiley & Sons.

13.

Lawless

(2002). Power and Conflict in pro-Growth Regimes. Urban Studies, Vol. 39, No. 8, 1329–1346.

14.

Levy

J.M

. (1990). Economic Development Programs for Cities, Counties and Towns. New York: Praeger.

15.

North

D.C

. (1990). Institutions, Institutional Change and Economic Performance. Cambridge, England: Cambridge University Press.

16.

Pascarella

T.A.

and Raymond

R.D

. (1982). Buying Bonds for Business: An Evaluation of the Industrial Revenue Bond Program. Urban Affairs Quarterly 18: 73–89.

17.

Schaeffer

P.V.

and Loveridge

(2000). Small Town and Rural Economic Development: A Case Studies Approach. Westport, Connecticut: Praeger.

18.

Steinnes

D.N

. (1984). Business Climate, Tax Incentives and Regional Economic Development. Growth and Change. 15:(2) 38–48.