Investment incentive

Investment incentive is a government-implemented incentive policy aimed to encourage investors into its domestic market or to promote expansion of existing businesses.[1] Investment incentives encompass creating an environment that enables foreign businesses to operate profitably and decreases risks.[2] They are widely used by developing countries to attract investments.[3] The incentives take form of "direct subsidies (investment grants) or corporate income tax credits (investment credit) that compensates the investors for their capital costs".[4]

Scholars generally consider economic development incentives to be inefficient, economically costly, and distortionary.[5]

See also

Further reading
  • Jensen, N., & Malesky, E. (2018). Incentives to Pander: How Politicians Use Corporate Welfare for Political Gain. Cambridge: Cambridge University Press.

References
  1. Jan Drahokoupil. Investment incentive GOVERNMENT POLICY. Encyclopædia Britannica.
  2. Checklist for Foreign Direct Investment Incentive Policies. oecd.org.
  3. Effectiveness of Investment Incentives in Developing countries Evidence and Policy Implications. Dr. Sebastian James. The World Bank Group.
  4. investment incentives Archived 2018-06-22 at the Wayback Machine. businessdictionary.com
  5. Jensen, Nathan M.; Malesky, Edmund J. (2018). "The Economic Case Against Investment Incentives". Incentives to Pander: How Politicians Use Corporate Welfare for Political Gain. Retrieved 2020-03-10.{{cite web}}: CS1 maint: url-status (link)
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