The evidence supporting many statements made here can be found in the references listed at the paper's end. Benefits vs. costs of incentives. The issues are whether benefits of incentives outweigh costs, and how benefits and costs are affected by local conditions and incentive design. Empirical research on taxes and business location suggests that state and local taxes have a statistically significant effect on business location decisions. Local job growth has significant effects on the earnings of local residents.
Incentives are costly per job created.
The effect of taxes on business location is modest. Many location and expansion decisions are unchanged by incentives. The cost of incentives to businesses whose location decisions are unchanged exceeds the taxes from businesses whose location decisions are changed. This implies that the average incentive program does not make sense in a low-unemployment area. If unemployment is low, local residents can easily find jobs, and the earnings benefits from greater employment rates will overstate the social benefits of new jobs.