Assessing the Effects of Place-Based Policy on Spatial Inequality and the Distribution of Household Income: Evidence from Tax Increment Financing

This research examines the effects of tax increment financing (TIF) on spatial inequality from 1990 to 2014 in Cook County, Illinois. The author explores the effects of TIF on real income and income distribution and examines whether the effects lead to a reduction in spatial inequality. To address the question of spatial inequality, dependent variables are constructed that assess the probability of TIF increasing upward mobility on the real income ladder and catching up with other areas. The results show beneficial distributional effects, but the effects are much attenuated when examining changes in the probability of moving up in the rankings, indicating that the effects of TIF are limited in reducing spatial inequality in the region.

Automated summary

This research examines the effects of tax increment financing (TIF) on spatial inequality in Cook County, Illinois, from 1990 to 2014. The study finds that while TIF has beneficial distributional effects on real income and income distribution, its impact on upward mobility and reducing spatial inequality is limited.