Working paper

Do unemployed workers benefit from enterprise zones? The French experience

Laurent Gobillon, Thierry Magnac, and Harris Selod


This paper is a statistical evaluation of the 1997 enterprise zone program in France. We investigate whether the program increased the pace at which unemployed workers residing in targeted municipalities and surrounding areas find employment. The work relies on a two- stage analysis of unemployment spells drawn from an exhaustive dataset over the 1993-2003 period in the Paris region. We first estimate a duration model stratified by municipalities in order to recover semester-specific municipality effects net of individual observed heterogeneity. These effects are estimated both before and after the implementation of the program, allowing us to construct variants of difference-in-difference estimators of the impact of the program at the municipality level. Following extensive robustness checks, we conclude that enterprise zones have a very small but significant effect on the rate at which unemployed workers find a job. The effect remains localized and is shown to be significant only in the short run.

JEL codes

  • C21: Cross-Sectional Models • Spatial Models • Treatment Effect Models • Quantile Regressions
  • C41: Duration Analysis • Optimal Timing Strategies
  • H25: Business Taxes and Subsidies
  • J64: Unemployment: Models, Duration, Incidence, and Job Search
  • R23: Regional Migration • Regional Labor Markets • Population • Neighborhood Characteristics

Replaced by

Laurent Gobillon, Thierry Magnac, and Harris Selod, Do unemployed workers benefit from enterprise zones? The French experience, Journal of Public Economics, vol. 96, October 2012, pp. 881–892.

See also

Published in

TSE Working Paper, n. 10-201, October 25, 2010