Kentucky Center for Economic Policy

It’s a common economic development strategy in the South: State policymakers offer deep tax incentives and relocation subsidies to lure big corporations from elsewhere, a tactic sometimes called “smokestack chasing.” New evidence, however, suggests supporting in-state startups and existing local companies is a far more effective strategy for creating jobs and building strong economies. In “...

The last couple of years have brought substantial new economic challenges to Appalachian Kentucky. Already saddled with being one of the poorest regions in the country, mountain communities are being hit hard by steep layoffs in the coal industry. Since 2011, eastern Kentucky has lost more than 5,700 good-paying coal mining jobs. That’s a loss of 42% of the area’s coal workforce.

This...