The Impact of a State-Level, Place-Based Economic Development Program: A Difference-in-Differences Approach

Abstract

This analysis uses a difference-in-differences approach to examine the impact of the Regional Cities Initiative (RCI) on economic development outcomes in counties that participated in the program relative to those that did not participate. The RCI was a place-based economic development program that was implemented in Indiana beginning in 2015. Through a competitive process, this program provided funding for projects meant to improve the quality of life in three regions of the state. The results indicate that participating counties had higher gross domestic product growth and higher employment growth than nonparticipating counties. There is limited evidence that the program had a positive impact on population growth. There were no discernable effects on house prices or earnings.