For nearly a decade, since the closing of its steel mills, the Mahoning Valley in northeast Ohio has pursued a traditional development strategy, based upon large capital subsidies, to attract new or support existing businesses. These policies have failed. As a result, local business leaders have questioned the foundations of traditional policy and have developed an alternative strategy that involves a far broader set of state and local programs in the development process. The new strategy aims at five objectives: (1) rebuilding the entrepreneurial environment; (2) strengthening existing businesses; (3) creating economic opportunity for the poor; (4) improving the quality of public services, especially education and infrastructure; and (5) improving the quality of life, especially housing.
Capital Subsidies and Countervailing Duties in Oligopolistic Industries