The tax concessions also drive up land values in the zones, so that the benefits go mainly to whoever happens to own land at the time the zones were designated.
The whole concept is predicated on the theory of Job Creationism. If Enterprise Zones are really such a good idea, why not turn the entire country into one big Enterprise Zone? Or is it that the government is content that the rest of the country should not be a suitable place for the expression of enterprise?
Of course we know that in reality, the concessions would cost too much to be applied nationally, but the creation of these zones is at least a tacit admission that there is something amiss with the way public revenue is raised. They are also an admission of the fact that the market in land does not react efficiently in situations and at times of low demand, when free market advocates would have us all believe that rents and land prices would drop to market-clearing levels. It is a pity that our politicians cannot bring themselves to think more incisively about the issue. And act accordingly.
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