S2E2 - Cailin Slattery, Bidding for Firms
Densely Speaking
00:00
Subs Competition Matters for Firm Locations
In a counterfactule, imagine we don't let states and cities compete with subsidies. And so i see that about half of the firms in my sample would choose a different location if they weren't offered a subsidy. In the aggregate, i that welfare increases by about ten %. This is because the firms locate in places that have slightly higher valuations for winning them under subsidy competition. A state like texas does well with and without the subsidy competition. So there are states like alabama that win 15 subsidy competitions in my sample, and win two when i shut down subsidy competition reght.
Transcript
Play full episode
