Donijo Robbins and Gerald J. Miller
Local public officials rely on tax and non-tax incentive packages to develop their economies. No conclusive evidence supports the economic improvement incentives afford. We…
Abstract
Local public officials rely on tax and non-tax incentive packages to develop their economies. No conclusive evidence supports the economic improvement incentives afford. We investigate, with an experimental approach, the political reasons public officials use tax incentives. The experiment uses simulation gaming to model local economic development as an auction, in that way permitting us to compare the impact that motives, goals, and contexts have on outcomes. Our findings suggest that the majority of economic development competitors fall victim to the “winner’s curse”-overestimating and overbidding the potential payoff for business development.
Competition for private investment, it has been argued, is often the fiercest between neighboring cities or cities within the same region. One result of maintaining a competitive…
Abstract
Competition for private investment, it has been argued, is often the fiercest between neighboring cities or cities within the same region. One result of maintaining a competitive edge (stimulating private investment) over other localities, is that local public officials rely on tax and non-tax incentive packages. If this is true, it seems that municipal public officials in New Jersey would perceive this competition and offer incentive packages given their location near major cities like Boston, New York, Philadelphia, and Washington, DC. This article explores the perceptions of local public officials in New Jersey about competition and the impact of tax and non-tax incentives in the context of population, unemployment, income, geographic location, and government structure.
John F. Sacco and Gerard R. Busheé
This paper analyzes the impact of economic downturns on the revenue and expense sides of city financing for the period 2003 to 2009 using a convenience sample of the audited end…
Abstract
This paper analyzes the impact of economic downturns on the revenue and expense sides of city financing for the period 2003 to 2009 using a convenience sample of the audited end of year financial reports for thirty midsized US cities. The analysis focuses on whether and how quickly and how extensively revenue and spending directions from past years are altered by recessions. A seven year series of Comprehensive Annual Financial Report (CAFR) data serves to explore whether citiesʼ revenues and spending, especially the traditional property tax and core functions such as public safety and infrastructure withstood the brief 2001 and the persistent 2007 recessions? The findings point to consumption (spending) over stability (revenue minus expense) for the recession of 2007, particularly in 2008 and 2009.