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Why Mayors Keep Trying to Woo Business With Tax Breaks

U.S. mayors are split on whether business incentives are good politics, but most believe—despite evidence to the contrary—that they’re good policy.
Mayor Bill de Blasio speaks during a news conference about Amazon's headquarters expansion to Long Island City in the Queens on November 13, 2018.
Mayor Bill de Blasio speaks during a news conference about Amazon's headquarters expansion to Long Island City in the Queens on November 13, 2018.Jeenah Moon/Reuters

We at CityLab have written quite a lot about Amazon’s HQ2 and the use (or abuse) of taxpayer-funded incentives to lure large corporations. The reality is that corporations make location decisions based on factors like the availability of talent, and then game the process to extract maximum incentives. Despite that, the ultimate HQ2 winners—New York and Virginia—offered more than $2 billion combined in various tax credits and incentives to attract Amazon.

So how do America’s mayors really feel about the HQ2 bidding war and the use of business incentives generally?