Economic Development Assistance to Professional and Technical Services

A computable general equilibrium model is used to compare the economic impact of subsidies between professional and technical services, high-technology manufacturing and traded services. The results suggest that the largest increase in aggregate real income is a factor tax deduction on capital to high -technology manufacturing. A factor tax deduction for the purchase of labor within professional and technical services industries increases aggregate real income in comparison to the same subsidy awarded to high-technology manufacturing or traded services. However, subsidies to either high-technology manufacturing or traded services result in increased income inequality. Only a subsidy to traded services decreases income inequality.

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Journal Article
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Journal of Regional Analysis and Policy, 32, 2
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 Record created 2017-04-01, last modified 2021-01-22

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