Skip to comments.Stimulus Surprise: Companies Retrench When Government Spends
Posted on 06/18/2010 7:27:30 AM PDT by bigbob
New research from Harvard Business School suggests that federal spending in states appears to cause local businesses to cut back rather than grow. A conversation with Joshua Coval. Key concepts include:
* The average state experiences a 40 to 50 percent increase in earmark spending if its senator becomes chair of one of the top-three congressional committees. In the House, the average is around 20 percent.
* For broader measures of spending, such as discretionary state-level federal transfers, the increase from being represented by a powerful senator is around 10 percent.
* In the year that follows a congressman's ascendancy, the average firm in his state cuts back capital expenditures by roughly 15 percent.
* There is some evidence that firms scale back their employment and experience a decline in sales growth.
(Excerpt) Read more at hbswk.hbs.edu ...
Or to put it more bluntly: The whole notion of the "stimulus" doesn't work. Unless you don't really give a damn about private business investment and capitalism.
How DARE these stupid companies act intuitively to artificially-imposed external pressures!!!!
/do I need it?
Employers on Strike
They forgot to describe the results as “surprising” and “unexpected”.
With animals like Ubama and the rats, government is God.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.