4 ms·
> It's mostly certainly not a "quantity discount." These corporation aren't "buying" anything from these cities. The city is selling its land (in quantity) and
by kiallmacinnes 8y ago
> It's mostly certainly not a "quantity discount." These corporation aren't "buying" anything from these cities.
The city is selling its land (in quantity) and talent pool (in quantity), and is giving a tax break (a discount).
> If Apple comes in sets up shop on 100 acre campus in your town and gets tax breaks to do so then your town forfeits the equivalent tax revenue another company would have paid for the same parcel of land.
If Bestbuy sells Microsoft 1000 laptops at a 30% discount, Bestbuy has forfeited the revenue they would have made from doing 1000 single unit+no discount sales. Despite the business making far less than maximum revenue, businesses choose to do this all the time as it created greater value for them in the end. Cities are doing essentially the same thing with big companies.
You just can't look at a discount and naively equate that to a $ loss in the city bank account, just as a business can't do this when they sell a physical good.
- bogomipz 8y ago>"The city is selling its land (in quantity) and talent pool" No the city is not selling land. Where in that article is it stated that Austin is selling Apple land? The city isn't "selling" it's talent pool. Companies will always gravitate towards where there's a steady supply of talent. >If Bestbuy sells Microsoft 1000 laptops at a 30% discount" Yeah your analogy is absurd, taxes are a "recurring" revenue stream for a city. It's not at all similar to a single retail transaction. >"You just can't look at a discount and naively equate that" It's not a "discount", there are no goods being sold. Future recurring revenue is being forfeited. And when there's a future budgetary short fall(and there alway is) it will be made up by the individual tax payer.