Munich Personal RePEc Archive

Assessing State Economic Development from Motion Picture and Television Production Incentives: Standardizing the Industry for Analysis

Rickman, Dan and Wang, Hongbo (2020): Assessing State Economic Development from Motion Picture and Television Production Incentives: Standardizing the Industry for Analysis.

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Abstract

Studies of the economics of state fiscal incentives for the motion picture and television industry lack consistency in methodology. A key inconsistency is the use of differing levels of industry aggregation. This study unpacks aggregate sector multipliers for 48 states and shows how use of aggregated measures for the motion picture and television industry can lead to inaccurate input-output multipliers and empirical estimates of the role of incentives in the location of the industry. In practice, regional input-output models need to be modified to reflect the economic differences across activities in the aggregate sector, particularly for states that contain little of the targeted activity. A case study shows that a practical alternative is to use aggregate multipliers from similar states with large concentrations of the industry.

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