This dissertation consists of three chapters that study political economy and public policy. Chapter 1 develops an innovative method to measure the "unmeasurable" local industrial policies. Chapter 2 examines the impact of state taxes and subsidies on retail establishments. Chapter 3 explores how peace and reunification events affect petty corruption. The first chapter, "Local Policies and Firm Location: Measuring the 'Unmeasurable'," explores how local governments in China compete to attract businesses and examines the role of local leaders' promotion motives in intensifying such competition. Local governments compete by offering city-wide policies, such as lowering tax rates, giving subsidies, providing financial support, or loosening environmental regulations. The difference between what is practiced and what is legally mandated is non-negligible, and many of these policies remain unobservable due to limited data accessibility. To address this issue, I introduce a novel method to quantify the net effect of various policies proposed by local governments. This net effect, referred to as the policy index, is identified using data from all manufacturing plant locations along with a spatial border design. When applying this method to Jiangsu, a province in China with 13 competitive cities, all ranked in the top 100 by GDP over the past decade, I find that geographically proximate cities tend to adopt similar industrial policies, and contrary to popular belief, coastal cities are not necessarily more pro-business. I then incorporate the estimated policy index into a promotion competition framework to understand how policies are determined in equilibrium and how competition, in turn, affects the business landscape. Counterfactual simulations demonstrate that firms are distributed more evenly across space, with only 23% of them choosing a different location if leaders' incentives were the same across all cities. The second chapter, "A Tax-Shaped Retail Landscape," co-authored with Feng Chi, Limin Fang, and Nathan Yang, investigates the impact that seemingly uniform tax policies have on shaping the retail landscape. Using comprehensive data about all retail establishments in the conterminous United States from 1990 to 2014, we first show that while retail establishments are more likely to open in markets with favorable state tax policies, it is primarily the largest chains that are contributing towards this effect on entry. Motivated by these empirical realities, we analyze an entry model where firms are subject to taxes to demonstrate that tax effects on retailer entry can potentially amplify market dominance, such that retailers with preexisting size-based advantages are disproportionately more responsive to the tax policies. Furthermore, we show that revenue-maximizing tax levels that the government could set have the potential to exacerbate the dominance of strong firms. Finally, we provide calibrated model analysis based on data about home improvement retail chain entry. This calibration exercise illustrates the economic magnitude associated with asymmetric retail entry responses to tax policy. The third chapter, "Peace and Petty Corruption: Evidence from Trucking in Côte d'Ivoire," co-authored with Jeremy Foltz and Souleymane Soumahoro, examines how peace and reunification affect petty corruption. We explore a sequence of exogenous peace events following the arrest of the incumbent president of Côte d'Ivoire in April 2011, which lessened the tension caused by armed conflicts in the north (rebel area) and made the political management similar to the south (non-rebel area). A unique dataset on extortion payments by truck drivers allows us to observe more than 1,000 truck journeys and 26,000 stops over two years in corridors going from Côte d'Ivoire to Mali and Burkina Faso. Specifically, we use a difference-in-differences strategy to compare bribe behaviors at checkpoints in Côte d'Ivoire with those in Mali and Burkina Faso before and after the peace events. We find a large and significant "peace dividend": bribe values and bribe efforts decreased by 67% and 75%, respectively. We demonstrate with a simple theoretical model and our empirical estimates that the larger reduction in corrupt behavior in the rebel zone relative to the non-rebel zone can be explained by a composition effect—i.e., a shift of the checker’s identity from a rebel to a civil servant—and a market structure effect—i.e., a change in the bureaucracy structure within each checkpoint from a monopoly (only rebels) to competition (customs, police, gendarmerie, and others).