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Firm Relocation Threats and Copy Cat Costs

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  • Darin Wohlgemuth
  • Maureen Kilkenny

Abstract

With increasing frequency, state governments offer incentive packages to keep companies from leaving. But these tax incentive packages can cost more than foregone revenues from the single threatening firm. Other firms are encouraged to demand similar tax breaks. The authors explicitly consider the role of these copy cats in determining a government's optimal response to firm relocation threats. The information may help governments distinguish for which cases offering incentives is a worthwhile investment.

Suggested Citation

  • Darin Wohlgemuth & Maureen Kilkenny, 1996. "Firm Relocation Threats and Copy Cat Costs," Center for Agricultural and Rural Development (CARD) Publications 95-wp142, Center for Agricultural and Rural Development (CARD) at Iowa State University.
    • Handle: RePEc:ias:cpaper:95-wp142
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    References listed on IDEAS

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    Cited by:

    1. Gabe, Todd, 2000. "The Effects of Business Assistance Programs on Employment Growth in Maine Establishments," MPRA Paper 65983, University Library of Munich, Germany.
    2. repec:rre:publsh:v:38:y:2008:i:1:p:67-88 is not listed on IDEAS
    3. Ann Markusen (ed.), 2007. "Reining in the Competition for Capital," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number ricc, November.
    4. Gabe, Todd M. & Kraybill, David S., 1998. "Tax Incentive Requests and Offers in a State Economic Development Program," The Review of Regional Studies, Southern Regional Science Association, vol. 28(3), pages 1-14, Winter.

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