| The reason is game theory. Every city has an incentive to leave the bargaining group and make its own proposal. Taxes in general are a similar topic. In a functioning democracy, the government/legislator should set the taxes as they see fit, yet with increasing globalization, countries become price takers (https://www.investopedia.com/terms/p/pricetaker.asp), because many taxable goods become more mobile. This is in line with this observation: > Rep. Keith Ellison, D-Minn., has also offered a dissent to the process. > “Something is deeply wrong with our economy & democracy when local government offer up their > tax base to a corporation worth over $500 billion,” he wrote on Twitter. Game theoretic constructs, where the social optimum solution is not reached can be seen in other topics as well. Take climate change for example, where a lot of governments know what the best outcome for the world(and thereby themselves) is, yet act in their own best interest and emit CO2. A collective "bargaining" solution would make sense, but has yet to happen. Finding solutions for this is challenging and not as easy as the article puts it. |
Except 3: Montgomery County, Washington DC, and Northern Virginia.
If Virginia gets Amazon, the other two benefit with increased commercial activity. Even if the taxes aren't directly collected from Amazon HQ2, the increased shopping, increased services, and all that will lead to major benefits for the entire region.
There's one group that can collectively bargain, and benefit even if its rivals win over. That gives that particular group a major edge.
Its unusual that three of the top20 positions are within a 20-mile radius. Amazon must be really considering that area.
https://i0.wp.com/www.thedailychronic.net/wp-content/uploads...
"Northern Virginia" is basically Arlington. As you can see, Arlington / DC / Montgomery County are literally next to each other.
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Newark NJ and New York City are the other city-grouping that could work together on the Amazon deal.