No abstract

The escalation of incentive awards to attract and retain new business has emerged as a major concern in state and local development policy. This article addresses claw-back provisions, a largely neglected part of the bargaining process between governments and businesses in the location of new plants and offices. Just as private business transactions work within a framework of legally binding contracts, clawbacks provide some recourse to reclaim all or some of a financing package when a firm fails to meet performance requirements. Besides analyzing clawbacks, the authors identify three related areas for policy intervention: penalties, recisions, and recalibrations. The aim of this article is to show that U.S. policymakers can avoid expensive mistakes if they tie incentives to written guarantees of job creation and other benefits. European regional policymakers have used a carrot-and-stick approach to industrial recruitment. Increasingly, state and city governments in the United States also recognize that public-private bargaining requires some form of reasonable, guaranteed quid pro quo.

No abstract

No abstract

The nation is not the real economy; nor are state or local political jurisdictions. Metropolitan-centered economic regions are the functional economies. These metropolitan economic regions are linked in a highly interdependent system of regional economies. This system of regional economies overlays the political geography of the nation but does not correspond to national boundaries, just as metropolitan economic regions do not correspond to state or local political boundaries. Policymaking thus confronts two major but noncongruent systems: Economic federalism and political federalism. Noncongruence constitutes a major obstacle to economic policymaking and implementation. A political economy of these two federalisms is needed to fuse politics and policy.