The Bartik Benefit-Cost Model of Business Incentives is designed to evaluate incentive benefits with more realism than current commonly used models of incentive benefits. Yes, incentives can create jobs and thereby boost earnings and property values and provide state and local governments with more revenue. But incentives also have negative effects: jobs may go to in-migrants rather than state residents; higher housing prices raise overall prices and local costs, which hurts residents on fixed incomes and drives away some businesses; and growth brings needs for more public spending as well as new revenue. In evaluating incentives, we should consider both the positive and the negative effects.
The Bartik Benefit-Cost Model of Business Incentives is designed for anyone evaluating either a single incented project or an entire incentive program, including the following: state audit bureaus, state legislative committees and agencies, state economic development agencies, public and private interest groups, and journalists.
The Bartik Benefit-Cost Model of Business Incentives is flexible, in that it can evaluate a project or program with an arbitrary timetable of planned or actual job creation, as well as an arbitrary timetable of incentive payments.
The Bartik Benefit-Cost Model of Business Incentives focuses on tangible benefits and costs of incentives for state residents, in terms of higher income per capita. It includes information on different income types (e.g., earnings, higher property values, fiscal benefits) and on different income groups.
The Bartik Benefit-Cost Model of Business Incentives is a more realistic way of identifying costs as well as benefits of incentives.