Katja Hamel


State and local governments provide a variety of inducements to persuade private industries to locate in their areas. Corporate welfare takes the form of property and sales tax abatements or exemptions, low interest loans, grants, utility credits, and other financial incentives given to companies by states and localities with the expectation that these companies will bring with them more jobs and increased revenue for the residents of those communities. Because these programs are largely promise- based rather than performance based, they often fail to meet expectations. Despite the overall inefficiencies of business location incentives, other factors assure their continued use.