An Evaluation of the Effectiveness of Louisville’s Enterprise Zone

Abstract

Louisville, Kentucky, has one of the oldest and largest enterprise zones (EZs) in the United States, yet until recently, the program had not been independently evaluated. Perhaps because no clearly superior evaluation methodology has emerged in the literature, the efficacy of EZ programs around the United States remains a contentious subject among scholars and policy makers alike. The authors take a quasi-experimental approach in evaluating Louisville’s EZ, using many different measures to give the program every chance to show success. Program tax exemptions and administrative costs of more than $55 million within the 13-year period studied are identified. The measures reveal that one of the EZ’s three objectives was obtained in one geographic subset of the zone, but not because of the EZ policy treatment. The research adds one more case study to the EZ literature and provides another indication of the questionable benefits of EZ programs.