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The Effects of Local Conditions on Economic Growth, 1977-1990

The Changing Location of High-Technology Activities

State University of New York, Stony Brook

Duckjoon Kim

Hankuk University of Foreign Studies

To promote economic growth and improve their tax base, local governments compete to attract "high-tech" industries. The authors analyze the outcome of this competition, documenting the geographical dispersion of high-tech activities over the last 15 years and assessing the degree to which their location is attributable to the effects of local factors, including public policies. They show that high-tech jobs and establishments have changed location across localities and that many local conditions influence the location of high-tech activities. However, these conditions reflect the wealth of the community and not local governmental spending and tax policies, which have only marginal effects on the location of high-tech activities.

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