The Effects of Polish Special Economic Zones on Employment and Investment: Spatial Panel Modelling Perspective.

Cizkowicz, Piotr and Cizkowicz-Pekala, Magda and Pekala, Piotr and Rzonca, Andrzej (2015): The Effects of Polish Special Economic Zones on Employment and Investment: Spatial Panel Modelling Perspective.

Abstract

We estimate the set of panel and spatial panel data models of employment and investments for 379 Polish counties over the period 2003-2012. We take advantage of a unique firm-level dataset for Polish Special Economic Zones (SSEs), which includes about 30,000 observations. We find that SSEs have substantial positive effects on employment: jobs in a given SSE create jobs outside the SSE in hosting county and even more jobs in neighbouring counties. Effect of SSEs on investments is weaker, but still positive. Investments in a given SSE neither crowd out nor crowd in investments outside the SSE. Thereby, they add one to one to capital stock in hosting county. Our findings are robust to changes in estimation methods, sample composition, set of explanatory variables and spatial weight matrix.

• Item Type: MPRA Paper
• Language: English
• Keywords: special economic zones, regional economic development, economic policy tools, panel data models, spatial panel data models
• Subjects: C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C21 - Cross-Sectional Models ; Spatial Models ; Treatment Effect Models ; Quantile Regressions; C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C23 - Panel Data Models ; Spatio-temporal Models; H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H25 - Business Taxes and Subsidies; H - Public Economics > H3 - Fiscal Policies and Behavior of Economic Agents > H32 - Firm; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R15 - Econometric and Input-Output Models ; Other Models

References

AITKEN, B. and HARRISON, A. (1999) Do Domestic Firms Benefit From Direct Foreign Investment? Evidence From Venezuela, American Economic Review 89, 605-618.

BALCEROWICZ L., RZOŃCA A., KALINA L., ŁASZEK A. (2013) Economic Growth in the European Union, Lisbon Council, Brussels.

BILLINGS, S. (2009) Do Enterprise Zones Work? An Analysis at the Borders, Public Finance Review 37, 68-93.

BLOMSTROM, M., GLOBERMAN, S. and KOKKO, A. (2000) The Determinants of Host Country Spillovers From Foreign Direct Investment, CEPR Discussion Papers No. 2350, Centre for Economic Policy Research, London.

BLOMSTROM, M. and WANG, J. (1992) Foreign Investment and Technology Transfer: a Simple Model, European Economic Review 36 (1), 137-155.

BONDONIO, D. (2003) Do Local Tax Incentives Affect Economic Growth? What Mean Impacts Miss in the Analysis of Enterprise Zone Policies, Working Papers No. 03-17, Center for Economic Studies, U.S. Census Bureau.

BORENSZTEIN, E., DE GREGORIO, J. and LEE, J. (1998) How Does Foreign Direct Investment Affect Economic Growth?, Journal of International Economics 45, 115-135.

BYCZKOWSKA, M. and KACZMAREK, A. (2010) Activity of the Foreign Investors Functioning on the Area Enclosing Kostrzynsko-Slubicka Economic Zone After Polish Accession to the EU, Acta Universitatis Lodziensis Folia Oeconomica 242, 91-104.

CIEŚLEWICZ, W. (2009) Regionalna pomoc publiczna jako instrument aktywizacji gospodarczej- przypadek specjalnych stref ekonomicznych w Polsce, Nierówności społeczne a wzrost gospodarczy. Uwarunkowania instytucjonalne 15, 318-333.

CIŻKOWICZ P., KOWALCZUK M., RZOŃCA A. (2014) Heterogeneous Determinants of Local Unemployment in Poland, NBP Working Paper 188.

CIŻKOWICZ, P., CIŻKOWICZ-PĘKAŁA, M., PĘKAŁA, P. and RZOŃCA, A. (2015) Why Some Special Economic Zones Are More Successful than Others?, mimeo.

CRIUSCUOLO, CH., MARTIN, R., OVERMAN, H. and VAN REENEN, J. (2007) The Effect of Industrial Policy on Corporate Performance: Evidence From Panel Data, paper presented at International industrial organization conference, Washington DC, USA.

DEVEREUX, M., GRIFFITH, R. and SIMPSON, H. (2007) Firm Location Decisions, Regional Grants and Agglomeration Externalities, Journal of Public Economics 91, 413-435.

DRISCOLL, J.C. and KRAAY, A. (1998) Consistent Covariance Matrix Estimation With Spatially Dependent Panel Data, The Review of Economics and Statistics 80(4), 549-560.

DJANKOV, S. and HOEKMAN, B. (2000) Foreign Investment and Productivity Growth in Czech Enterprises, World Bank Economic Review 14, 49-64.

EDGE, R.M. and RUDD, J.B. (2010) General-Equilibrium Effects of Investment Tax Incenvites, CAMA Working Paper 3/2010, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.

ELHORST, J.P. (2010), Applied Spatial Econometrics: Raising the Bar, Spatial Economic Analysis 5(1), 9-28.

FINDLAY, R. (1978) Relative Backwardness, Direct Foreign Investment, and the Transfer of Technology, Quarterly Journal of Economics 92, 1-16.

GE, W. (2012) Special Economic Zone and Technological Learning: an Analytical Framework, Economics and Finance Review 2, 1 – 15.

GIVORD, P., QUANTIN, S. and TREVIEN, C. (2012) A Long-term Evaluation of the First Generation of French Urban Enterprise Zones, Working Paper No. G 2012/01, Institut National de la Statistique et des Études Économiques, France.

GIVORD, P., RATHELOT, R. and SILLARD, P. (2011), Place-based Tax Exemptions and Displacement Effects: an Evaluation of the zones Franches Urbaines Program, Working Papers No. 2011-19, Centre de Recherche en Economie et Statistique, France.

GLASS, A.J. and SAGGI, K. (1998) International Technology Transfer and the Technology Gap, Journal of Development Economics 55, 369-398.

GOBILLON, L., MAGNAC, T. and LAURENT, H. (2012) Do Unemployed Workers Benefit From Enterprise Zones? The French experience, Journal of Public Economics 96, 881–892.

GODLEWSKA-MAJKOWSKA, H. and TYPA, M. (2008), Atrakcyjność inwestycyjna województwa małopolskiego 2006-2008, Instytut Przedsiębiorstwa, Warszawa.

GORG, H. and STROBL, E. (2001) Multinational Companies and Productivity Spillovers: a Meta-analysis, The Economic Journal 111(475), 723-739.

GOSS, E. and PHILLIPS, J. (2001) The Impact of Tax Incentives: Do Initial Economic Conditions Matter? Growth and Change 32, 236-50.

GWOZDZ, K. and KWIECIŃSKA, K. (2005), Wpływ SSE Euro-Park Mielec na rynek pracy, in DOMAŃSKI, B. and GWOZDZ, K. (Eds) Dziesięć lat doświadczeń pierwszej polskiej specjalnej strefy ekonomicznej Mielec 1995-2005, Instytut Geografii i Gospodarki Przestrzennej Uniwersytetu Jagiellońskiego, Kraków.

HASKEL, J. E., PEREIRA, S. and SLAUGHTER, M. (2002), Does Inward Foreign Direct Investment Boost the Productivity of Domestic Firms? Working Paper No. 8724, National Bureau of Economic Research.

HAVRANEK, T. and IRSOVA, Z. (2011) Determinants of Horizontal Spillovers From FDI: Evidence From a Large Meta-Analysis, CNB Working Paper Series No. 7/2011, Czech National Bank.

HIRASUNA, D. and MICHAEL, J. (2005) Enterprise Zones: a Review of the Economic Theory and Empirical Evidence, Policy Brief, Minnesota House of Representatives Research Department.

HOUSE, C.L. and SHAPIRO, M.D. (2006) Phased-In Tax Cuts and Economic Activity, American Economic Review 96(5), 1835-1849.

JARCZEWSKI, W. (2006), Specjalne strefy ekonomiczne jako czynnik przyciągający inwestorów, in DOMAŃSKI, B. and

JARCZEWSKI, W. (Eds) Klimat inwestycyjny w województwie małopolskim, Departament Gospodarki i Infrastruktury Urząd Marszałkowski Województwa Małopolskiego, Kraków.

JENSEN, C. and WINIARCZYK, M. (2014), Special Economic Zones – Twenty Years Later, CASE Network Studies and Analyses No 467/2014, Centrum Analiz Społeczno-Ekonomicznych, Warszawa.

JOHANSSON, H. and NILSSON, L. (1997), Export Processing Zones as Catalysts, World Development 25(12), 2115–2128.

KOKKO, A., TANSINI, R. and ZEJAN, M. (1996) Local Technological Capability and Productivity Spillovers From FDI in the Uruguayan Manufacturing Sector, Journal of Development Studies 32, 602-611.

KOZACZKA, M. (2008) Specjalne strefy ekonomiczne w Polsce 1995-2007, Fundacja CAMPUS, Stalowa Wola.

KRYŃSKA, E. (2000) Polskie specjalne strefy ekonomiczne – zamierzenia i efekty, Wydawnictwo Naukowe Scholar, Warszawa.

LESAGE, J. (2014) What Regional Scientists Need to Know About Spatial Econometrics, The Review of Regional Studies 44(1), 13-32.

LESAGE, J. and FISCHER, M. (2008) Spatial Growth Regressions: Model Specification, Estimation and Interpretation, Spatial Economic Analysis 3, 275-304.

LESAGE, J. and PACE, R. K. (2009) Introduction to Spatial Econometrics, CRC Press, New York.

LESAGE, J. P. and PACE, R. (2014) The Biggest Myth in Spatial Econometrics, Econometrics 2(4), 217-249.

LIN, P. and SAGGI, K. (2005) Multinational Firms, Exclusivity, and the Degree of Backward Linkages, Discussion Paper Series No. 1, Deutsche Bundesbank Research Centre.

LIU, Z. (2008) Foreign Direct Investment and Technology Spillovers: Theory and Evidence, Journal of Development Economics 85, 176–193.

MADDALA, G.S. and WU, S. (1999) A Comparative Study of Unit Root Tests With Panel Data and a New Simple Test, Oxford Bulletin of Economics and Statistics 61(S1), 631-652

MARKUSEN, J. and VENABLES, A. (1997) Foreign Direct Investment as a Catalyst For Industrial Development, NBER Working Papers No. 6241, National Bureau of Economic Research.

MAYER, T., MAYNERIS, F. and PY, L. (2013) The Impact of Urban Enterprise Zones on Establishments' Location Decisions: Evidence From French ZFUs', Banque de France Working Paper No. 458, Banque de France.

MAYNERIS, F. and PY, L. (2013) The Efficiency of Enterprise Zone Programs Some Conflicting Results? Discussion Papers No. 2013025, Institut de Recherches Economiques et Sociales.

MINISTRY OF ECONOMY (2013), Informacja o realizacji ustawy o specjalnych strefach ekonomicznych. Stan na 31 grudnia 2012 r.

NEUMARK, D. and KOLKO, J. (2008) Do Enterprise Zones Create Jobs? Evidence From California's Enterprise Zone Program, NBER Working Papers No. 14530, National Bureau of Economic Research.

PESARAN, H.M. (2007) A Simple Panel Unit Root Test in the Presence of Cross-Section Dependence, Journal of Applied Econometrics 22(2), 265-312

PILARSKA, C. (2009) Specjalne strefy ekonomiczne w Polsce, Wydawnictwo Uniwersytetu Ekonomicznego w Krakowie, Kraków.

REBONATO, R. and JACKEL, P. (2000) The Most General Methodology to Create a Valid Correlation Matrix For Risk Management and Option Pricing Purposes, Journal of Risk 2, 17-27.

RODRIGUEZ-CLARE, A. (1996) Multinationals, Linkages, and Economic Development, The American Economic Review 86 (4), 852-873.

RYDZ, E. (2003), Functioning of Special Economic Zones in Poland and Their Role in Activating Regional Economy, Acta Universitatis Carolinae- Geographica 1, 355-366.

SMĘTKOWSKI, M. (2002), Polish Special Economic Zones as an Instrument of Regional and Industrial Policy, MPRA Paper No. 39184, Munich Personal RePec Archive.

SMOLEŃ, M. (2010), Dynamika działalności Tarnobrzeskiej Specjalnej Strefy Ekonomicznej, Nierówności Społeczne a Wzrost Gospodarczy 17, 496-510

TROJAK, A. and WIEDERMANN, K. (2009) Specjalne strefy ekonomiczne i strefy przemysłowe w kształtowaniu rozwoju gospodarczego regionów na przykładzie Polski i Czech, Prace Komisji Geografii Przemysłu PTG 12, 133-143.

ZASĘPA, B. (2010), Efekty i skutki oddziaływania specjalnych stref ekonomicznych w obszarze rynku pracy ze szczególnym uwzględnieniem katowickiej SSE, in KOLCZYŃSKI, M. and WOJTASIK, W. (Eds), Innowacyjne i społeczne oddziaływanie specjalnych stref ekonomicznych i klastrów w Polsce, Towarzystwo Inicjatyw Naukowych, Katowice.