, corporate welfare does little if anything to actually create economic growth. It may in fact hurt the economy.
For their part, since politicians are spending other people’s money, they have little incentive to be careful investors. And ultimately, higher taxes must finance subsidies. So, corporate welfare depresses economic activity in some parts of an economy to encourage it in others, and over the long run, often fails to create jobs or investment on a net basis.
of subsidized firms would have chosen their location even without the subsidy because other factors — such as proximity to a customer base, supply chains, and livability — seem to matter more.Article content
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