Alkon, Meir (2018). “Do Special Economic Zones Induce Developmental Spillovers? Evidence from India’s States.” World Development, 107, 396–409.
Brussevich, Mariya, and Shawn Tan (2020). “Learning from Foreign Firms: does FDI Increase Exporter Competitiveness?” Unpublished Manuscript.
Busso, Matias, Jesse Gregory, and Patrick Kline (2013), “Assessing the Incidence and Efficiency of a Prominent Place Based Policy.” American Economic Review, 103 (2), 897–947.
Ghazanchyan, Manuk, Alexander Klemm, and Yong Sarah Zhou (2018). “Tax Incentives in Cambodia.” IMF Working Paper WP/18/71, Washington DC, USA.
Glaeser, Edward, Gottlieb, Joshua (2008). “The economics of place-making policies.” Brookings Pap. Econ. Act. 1, 155–239 (Spring).
Grant, Matthew (2020). “Why Special Economic Zones? Using Trade Policy to Discriminate across Importers.” American Economic Review, 110(5): 1540–1571.
IMF, OECD, UN, and World Bank (2015). “Options for Low Income Countries’ Effective and Efficient Use of Tax Incentives for Investment.” Report to the G20 Development Working Group, IMF Policy Papers.
James, Sebastian (2014). “Tax and Non-Tax Incentives and Investments: Evidence and Policy Implications.” Investment Climate Advisory Services, World Bank Group.
Lu, Yi, Jin Wang, and Lianming Zhu (2019). “Place-Based Policies, Creation, and Agglomeration Economies: Evidence from China’s Economic Zone Program.” American Economic Journal: Economic Policy, 11 (3), 325–360.
Neumark, David, and Jed Kolko (2010). “Do Enterprise Zones Create Jobs? Evidence from California’s Enterprise Zone Program.” Journal of Urban Economics, 68 (1), 1–19.
Wang, Jin (2013). “The economic impact of Special Economic Zones: Evidence from Chinese Municipalities.” Journal of Development Economics, 101, 133–147.
World Bank and the Asian Development Bank (2014). “The Investment Climate Assessment, 2014. Creating Opportunities for Firms in Cambodia.” World Bank, Phnom Penh, Cambodia.
I thank Jarkko Turunen, Alasdair Scott, Davide Furceri, APD seminar participants, and Staff at the Council for the Development of Cambodia, Cambodia’s Ministry of Economy and Finance, and Research and International Cooperation Departments of the National Bank of Cambodia for providing valuable comments and suggestions. Hibah Khan provided excellent research assistance. The views expressed in this study are the sole responsibility of the author and should not be attributed to the International Monetary Fund, its Executive Board, or its management.
Other theoretical motivations for establishment of SEZs include preferential tariff reductions for certain industries (Grant, 2020), industry localization (Duranton, 2011), as well as spatial income redistribution (Moretti, 2010).
Open Development Cambodia is a non-governmental organization operation in Southeast Asia. Open Development Cambodia collects publicly available data on economic and social development and posts compiled data on its website.
Mondul Kiri province was present in the sample only between 2011 and 2016. Pailin and Ratanak Kiri entered the sample in 2011. Therefore, differences for these provinces are taken between the first and the last available years. Tboung Khmum province is not included in the CSES survey.
In Panel B, coefficient on the time trend is negative and, given that the average length of the post-treatment period is about four years, the total size of the SEZ effect on female employment is attenuated to about 2 percentage points. Negative growth effect, however, is not robust to other specifications in Table 2 and Section 7.
Specification in Panel B shows that entry of SEZs is associated with about 4.6 percent decline in income inequality. However, the dynamic effect is not statistically significant. Given evidence provided by specifications in Panel C and Section 7, a more conservative estimate is appropriate in this case.
CSES survey does not allow for a direct test of SEZ effects on labor migration due to lack of data.
I exclude the interaction of post-SEZ trend and multiple SEZs dummy from this specification. None of the coefficients on the interaction terms were statistically significant and their inclusion does not affect the overall results. I only include results based on the specifications that robust to SEZ selection bias (i.e., specifications with propensity score weights and alternative control group).