Historical Studies (Chinese Edition)

No.2, 2018

Industry Recruitment and the Transformation of Manufacturing in the American South since the 1980s (Abstract)

Han Yu

Policies for attracting industry, particularly foreign companies, hold a controversial place in US states and local economic development policies. Although economic development policies centering on local enterprises have been gaining in popularity since the 1980s, attracting outside industries still holds sway in the South, with incentives being constantly ratcheted up. In fact, it is these incentives that have encouraged a number of advanced manufacturing and high-tech companies to set up factories in the South, resulting in the upgrading of Southern manufacturing from labor-intensive industry to high value-added and capital-intensive industry. Relatively low costs, particularly cheap labor, are an important precondition and foundation for the implementation of these policies. Their implementation, whether through incentives and preferential treatment or through the provision of customized training programs for the labor force, have directly or indirectly reduced enterprises’ operating costs and further strengthened the South’s cost advantage. This strategy is the key to the South’s success in attracting outside firms.