Is public agency relocation effective to achieve decentralization? Evaluating its effects on regional employment

ABSTRACT

This paper explores the effects of public agency relocation on the growth of local employment. The South Korean government has recently relocated 154 public agencies from the Seoul Metropolitan Area to local cities, called “Innovation Cities.” This policy was formulated to foster decentralization and regional development. However, only a few studies have examined the impact of this relocation. The innovation cities seem to be suffering from a lack of innovation, and the effects of decentralization. In this study, we evaluated the effects of relocation by using the synthetic control method and applying panel data gathered from 2006 to 2018. The unit of analysis is the small tier of local authority, and the outcome variable is the number of workers within each regional jurisdiction. To investigate counterfactuals, we determined control groups by selecting specific covariates of local employment. The results show that the increase in local employment was mostly caused by the migration of public agency employees to the destination areas. Spillovers are limited and influenced by regional characteristics.

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No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Mi Seon Jeon

Mi Seon Jeon is an Assistant Professor of Public Administration at Semyung University in Jecheon, Korea. She holds a PhD degree in Public Administration from Yonsei University. Her research interests include the empirical analysis of government policies and their effects on decentralization and regional development. Her articles have been published in Risk Analysis and Korean Public Administration Review. She has participated in numerous research projects commissioned by Korean regional and national authorities.

Jong soo Lee

Jong soo Lee is a Professor of Public Administration at Yonsei University, Seoul. He received his PhD from Sheffield University. He currently serves as the Chair of the Advisory Committee for the Ministry of Public Administration and Security in the Korean government and also as a Vice-President of Academic Affairs at Yonsei University. Lee took part in numerous research projects, sometimes initiating a change of governmental policies. He was the editor-in-chief of International Review of Public Administration and the author of many books and papers on the following topics: decentralization and its effects, local growth and community-building, and governmental reforms from a transnational perspective.