Ian Helfrich: 2026–27 economics job market

Abstract

The New Markets Tax Credit gives private investors a 39% federal credit for routing capital through certified Community Development Entities (CDEs) into projects in low-income census tracts. Over FY2001–FY2022 the program placed $66.6 billion of subsidized investment in 8,024 projects worth $120.9 billion. Non-metropolitan tracts received 19.6% of dollars, close to the program’s 20% administrative target, yet project-level leverage was lower there (median 1.07× against 1.19× metro). The raw rural gap is a precise −0.262. With CDE fixed effects, the mean within-CDE estimate is −0.047 and the median-regression analog is −0.001; neither the extensive- nor the intensive-margin estimate is statistically distinguishable from zero within intermediary. Of the explained movement, −0.185, or 86%, is associated with observed CDE composition. Deployment shows no bunching at the 20% target, although compliance may operate through allocation agreements that the public data do not record.

I assembled the transaction and project record, documented its provenance, estimated the pooled and within-intermediary comparisons, and decomposed the movement between them. The within-CDE estimates use CDE fixed effects identified from the 163 of 343 CDEs that deploy on both sides of the rural line; an order-invariant Gelbach decomposition divides the movement between the pooled and within-CDE estimates; and a cross-CDE excess-mass test looks for bunching at the 20% non-metropolitan target.

This is descriptive, noncausal evidence. The mean interval is wide; the design does not identify why intermediaries differ or resolve the mechanism.

This project was my original idea, and I am its sole author. Katia Antunes and Elizaveta Gonchar contributed to it; they are not coauthors.