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<br />Lamar County - Paris Economic Development Plan <br /> <br />EVALUATION <br /> <br />Guiding Principle 15: <br /> <br />The Effectiveness of Manv Economic Development Pro2rams Can <br />Be Evaluated Throu2h Relativelv Cheap Survevs. <br /> <br />The many economic development programs that provide services to fIrms-information, training, <br />advice, etc. ----can be evaluated relatively cheaply by written surveys of the businesses that are clients of <br />these programs. Clients of these programs do not have strong incentives to lie about their experience. But, <br />surveys are unlikely to be effective for programs that provide tax subsidies, loans, or other fInancial <br />subsidies to fIrms. Even if such programs had no effect on the fIrm's location decision, fIrms receiving <br />such fInancial assistance might want to claim that the program had an effect, either because such a claim <br />is legally necessary to receive assistance, or in order to keep the program alive for possible future use. <br /> <br />Surveys are likely to be more useful if they are as comparable as possible over time, and, to some <br />extent, across different programs. If surveys ask comparable questions, then government managers can <br />get some sense of how the quality of economic development services differs over time or across <br />programs. <br /> <br />The Urban Institute has published a book, Monitoring the Outcomes of Economic Development <br />Programs, that provides a comprehensive guide on how to conduct surveys of the business clients of state <br />economic development programs, including suggested survey instruments, advice on how to distribute the <br />survey, etc. The suggestions of this guide have been tested in evaluating economic development programs <br />in the states of Minnesota and Maryland. <br /> <br />Conclusion <br /> <br />Economic development is a diffuse area of policy for which only small amounts of public funds <br />are available. Effective local management of economic development requires careful targeting of the <br />limited public funds, leveraging of private resources, and cooperation of different groups in the local <br />labor market area. <br /> <br />The policy implications of this paper can be restated as follows: <br /> <br />. An important priority for limited public funds for economic development should be to encourage <br />local educational and training institutions to be more responsive to the training needs of small and <br />medium sized businesses in the area. Customized training funds should be focused on fIrms that <br />seem most likely to offer higher quality job opportunities to local residents, and should be <br />focused on training that is useful in a variety of jobs. Firms should pay for a portion of training <br />costs. <br /> <br />. Another priority should be public support for quasi-private information and training services for <br />small and medium sized fIrms and start-up fIrms, helping them determine how to export and <br />modernize, and helping with management issues. Firms should be charged some fees for these <br />services, in order to stretch limited public funds and provide an incentive for good service <br />performance. Where possible, these services should seek to work with groups of fIrms to <br />encourage cooperation to solve some of their problems. The quality of these services should be <br />regularly evaluated through surveys of the business clients ofthese programs. <br /> <br />Paris Economic Development Corporation <br /> <br />Page S3 <br />