From Amazon to Zynga, cities and states have thrown incentives at employers — headquarters, data centers, sports stadia, film productions — based on economic impact analyses promising big returns.
Most are junk.
These models assume perfect success: that incentives are decisive, jobs wouldn’t arrive otherwise and fiscal returns outweigh giveaways. They’re often churned out by conflicted firms paid by the very companies seeking subsidies, using opaque methods they won’t disclose.
In reality, as the W.E. Upjohn Institute for Employment Research has shown, most programs reward firms for doing what they would have done anyway, leaving local communities with inflated hopes and depleted budgets.
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