State Investment Tax Incentives: A Zero-Sum Game?

Bob Chirinko and Daniel Wilson

No 1895, CESifo Working Paper Series from CESifo

Abstract: Though the U.S. federal investment tax credit (ITC) was permanently repealed in 1986, state-level ITCs have proliferated over the last few decades. Are these tax incentives effective in increasing investment within the state? How much of this increase is due to investment drawn away from other states? Based on a panel dataset for all 50 states, we find a significant channel for state tax incentives on own-state economic activity and document the importance of interstate capital flows. Whether state investment incentives are a zero-sum game is less certain and depends on the definition of the set of competitive states.

Keywords: state tax incentives; interstate tax competition; business taxes (search for similar items in EconPapers)
JEL-codes: H25 H32 H71 H77 (search for similar items in EconPapers)
Date: 2007
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.cesifo.org/DocDL/cesifo1_wp1895.pdf (application/pdf)

Related works:
Journal Article: State investment tax incentives: A zero-sum game? (2008)
Working Paper: State investment tax incentives: a zero-sum game? (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_1895

Access Statistics for this paper

More papers in CESifo Working Paper Series from CESifo Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().