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Are incentives to attract investments effective? An analysis of Brazilian municipalities

Author

Listed:
  • Fabiana Rocha

    (University of São Paulo)

  • Veronica Orellano

    (Fundação Getúlio Vargas)

Abstract

This article aims to evaluate the impact of incentives to attract investments on formal employment in Brazilian municipalities, where these incentives are offered in the form of tax exemptions and through land donations/transfer of rights. It differs from the rest of the literature, which is concerned with strategic interactions among governments and generally focuses only on one instrument, namely, tax rates. The results indicate that tax exemptions have no effect, whereas land donations/transfer of rights seem to stimulate job creation only in the expansionary phase of the cycle.

Suggested Citation

  • Fabiana Rocha & Veronica Orellano, 2020. "Are incentives to attract investments effective? An analysis of Brazilian municipalities," Economics Bulletin, AccessEcon, vol. 40(1), pages 534-541.
    • Handle: RePEc:ebl:ecbull:eb-19-00830
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    tax exemptions; land donations; transfer of rights; employment; municipalities; Brazil;
    All these keywords.

    JEL classification:

    • H7 - Public Economics - - State and Local Government; Intergovernmental Relations
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue

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