Conventional economic wisdom holds that the optimal level of business taxes recovers the exact cost of providing public services to businesses. I present an alternative model and derive conditions under which a self-interested decisionmaker picks tax rates to maximize an objective function that...

We use data on all Wisconsin municipalities during the period 1990 to 2003 to study the effect of tax increment finance (TIF) on economic development. We use appropriate statistical techniques to measure the impact of TIF and control variables on aggregate property values. We also examine the...