Money for Nothing: Do Business Subsidies Create Jobs or Leave Workers in Dire Straits?

Source: Paul E. Miller, West Virginia Center on Budget and Policy, February 2009

West Virginia spends millions of dollars annually on public subsidies to private businesses in hopes of creating good-paying jobs. Yet evidence abounds of private companies cutting jobs after receiving state tax credits and low-interest loans. In extreme cases, corporations have gained or used their subsidies illegally, as in the indictment last year of the former chief executive of Sequelle Communications. More common, however, are companies that simply fail to deliver on their job-creation promises, often without consequences from the public agencies that fund them.
See also:
Accountability for Economic Development Subsidies
This report examines ways for the state to improve the return on its job-creation investments. Two specific issues are explored: the availability of information to policymakers and the public about business subsidies (transparency), and how well the recipients of business subsidies deliver on their pledges to create jobs (accountability).

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