Don’t Bind Investment Incentives to Job Creation

Photograph by Ryan McVay/Getty Images

Our elected officials often design policies to help entrepreneurs because they believe doing so will create jobs. One of their favorite approaches is to give investors incentives such as angel tax credits or capital gains tax exemptions, or by matching grants to finance startups. While it’s obvious that investors want to maximize return on investment—not job creation—policymakers often forget this.

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