Inter-region Subsidy Competition for a New Production Plant : What is the Central Government Optimal Policy ?

@inproceedings{Parcero2003InterregionSC,
  title={Inter-region Subsidy Competition for a New Production Plant : What is the Central Government Optimal Policy ?},
  author={O. J. Parcero},
  year={2003}
}
  • O. J. Parcero
  • Published 2003
This paper models inter-regional competition for FDI and optimal government policy intervention to protect the national interest. Two regional authorities bargain with a single multinational over where it will locate. This potentially leads to excessive competition between the regions, favouring the multinational. The federal government obviously wants to limit such competition but lacks information on comparative advantage. This paper examines its optimal policy. Among the main results we have… CONTINUE READING

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