Local governments that offer greater incentives for businessesdo not retrench welfare services

In the pursuit of economic development and growth, many local governments in the US are increasingly turning to offering lucrative incentives to businesses such as tax incentives, loans and other subsidies. Many scholars and commentators have become concerned that these incentives are going hand in hand with the gutting of social welfare services. In new research, Lazarus Adua and Linda Lobao find no such relationship between counties putting in place business incentives and cutting services. In fact, such counties were actually more likely to provide a greater number of social services.