Examining the Local Economic Impacts of the Community Development Block Grant

George W. Zuo
RAND

This article provides preliminary evidence on the job impacts of the Community Development Block Grant (CDBG) program. The author uses a difference-in-differences (DiD) study design to leverage a one-time shock to the formula allocation process, which permanently reshuffled grant generosity, creating quasi-experimental variation. Job counts increased greatly in localities that received a large positive boost to their allocations but were unchanged in localities where allocations fell. For localities that benefited from the shock, cost-per-job estimates of the CDBG appear promising.