Economic implications of location bidding wars

Assignment Help Operation Management

Reference no: EM13807671

United Airlines announced its competition to select a town for a new billion -dollar aircraft-repair base. The bidding for the prize of 7,500 jobs paying at least $25 per hour was fast and furious, with Orlando offering $154 million in incentives and Denver more than twice that amount. Kentucky's governor angrily rescinded Louisville's offer of $300 million, likening the bidding to "squeezing every drop of blood out of a turnip."

When United finally selected, from among the 93 cities bidding on the base, the winner was Indianapolis and its $310 million offer of taxpayer's money. But in 2003, with United near bankruptcy, and having fulfilled is legal obligation, the company walked away from the massive center. This left the city and state governments out all that money, with no new tenant in sight. The city now even owns the tools, neatly arranged in each of the 12 elaborately equipped hangar bays. United outsourced its maintenance to mechanics and a Southern firm, which pays a third of what United gave out in salary and benefits in Indianapolis.

What are the ethical, legal and economic implications of such location bidding wars? Who pays for such giveaways? Are local citizens allowed to vote on offers made by their cities, counties, or state? Should there be limits on these incentives?

Reference no: EM13807671

Questions Cloud

What is the process in arizona for removing judge under 70 : What is the process in Arizona for removing a judge under the age of 70 who is mentally impaired. Couldn't that same process be employed for judges over 70, if needed

Field of human resource management : purpose of the Reflective Paper is for you to culminate the learning achieved in the course by describing your understanding and application of knowledge in the field of human resource management.

Sustainable development and the environment : You have learned that there are a lot of amazing companies throughout the world that are leading the charge in CSR and Global Citizenship.

Create mini-python projects or programs : Your assignment is to create mini-Python projects or programs and to run them in the Python-IDLE environment

Economic implications of location bidding wars : What are the ethical, legal and economic implications of such location bidding wars? Who pays for such giveaways? Are local citizens allowed to vote on offers made by their cities, counties, or state? Should there be limits on these incentives?

What would an investor be willing to pay for common stock in : 1. What would an investor be willing to pay for common stock in a firm that is expected to pay an annual dividend that will grow at 10 percent over the next 2 years, then grow at 5 percent for 3 years and then stop growing (i.e., will grow at zero pe..

Importance of ethical responsibility : Explain the importance of ethical responsibility. How do stakeholders impact decision-making? How can a leader be profitable and ethical if the competition is not?

Write a paper about competition and teamwork in workplace : Write a business communication research paper about competition and teamwork in workplace.

Forecasting techniques does this company use : What forecasting techniques does this company use? How does your selected organization prepare budgets?

User Account

All Pages