| Abstract: | Industrial revenue bonds (IRBs) have become an increasingly popular, though expensive and controversial, tool of economic
development at the state and local levels. That controversy has focused on the economic impact of IRBs: Whether or not they
meet the intended goals of creating jobs and stabilizing the tax base of local communities, and whether the benefits are worth
the costs. Though IRBs are often justified, at least in part, as a particularly useful program for older, urban, minority
communities, little research has been done on the participation of racial minorities and women in IRB programs. This article
examines Chicago’s IRB program and finds that minorities have not participated equitably. Racial minorities and women are
underutilized in many firms receiving this form of publicly subsidized financial assistance, and minority-owned businesses
receive a disproportionately small share of the loans. Policy recommendations are offered to assure equitable participation
of racial minorities and women in IRB programs. |
