Inner-city business development is often proposed as a solution to inner-city poverty. However, research evidence suggests that creating new jobs in the inner city is unlikely by itself to significantly increase the employment or earnings of the inner city poor. Public subsidies for inner city business development may be justified by greater environmental, congestion, and fiscal benefits of inner city vs. suburban business location decisions.
The research evidence suggests that some boost in inner city business development may be provided by a combination of economic development incentives with enhanced public services.

A different set of policies must be used to increase the earnings of the inner city poor. These employment solutions to inner city poverty should include two components:

W.E. Upjohn Institute for Employment Research
Timothy J. Bartik

01/10/2000

Timothy J. Bartik

research

Urban Policy > Economy knowledge & employment > Urban economy

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