Only if the firm would move abroad would there be a net loss. Indeed, and even then: there's no net-loss for the world, just the arbitrary jurisdiction-of-refe

Only if the firm would move abroad would there be a net loss. Indeed, and even then: there's no net-loss for the world, just the arbitrary jurisdiction-of-reference. (And if it's not-OK to play net-destructive, negative-sum games against other localities within the same country, is it OK to play negative-sum games against other friendly countries?) While I agree in the main, it's possible to contrive just-so scenarios where an incentive to shift economic to another locality might be net-beneficial. A struggling area might benefit more, from the same number of jobs or amount of economic activity, than a wealthier area. The wise creation of a synergistic cluster of related projects might create more follow-on benefits than a more dispersed set of activities. But, local authorities in a bidding-war against other localities are unlikely to identify just those scenarios, and pay the efficient amount – as opposed to just trotting out these stories as self-serving rationales for self-aggrandizing favor-trading.