In this paper, we examine a major transparency initiative affecting tax abatements for state and local economic development in the United States that has been plagued by noncompliance. Unlike academic studies examining government compliance with transparency rules such as Freedom of Information Act (FOIA) requests, we examine government and independent auditor responses to inquiries about information already posted, or not posted, in annual financial reports. Using a pre-registered experimental approach on cities, counties, and school districts in a single large-population state (Texas), we remind entities and their external auditors of their transparency obligations as well as our ability to check their compliance with this transparency rule and ask these entities follow-up questions about their required posts. Against expectations, we found that entities were not significantly more likely to comply with our request for information when we reminded them of their disclosure obligations and we found some evidence that nudges made entities less likely to comply. We argue these results provide novel insights into the limitations of transparency initiatives.

Firms and governments often negotiate economic development deals, such as tax abatements, with limited transparency, using exceptions to public records laws or other strategies for nondisclosure. In this article we explore the motivations of firms for keeping economic development deals out of the public eye. We explore legal challenges to public records requests for deal-specific, company-specific participation in a state economic development incentive program. By examining applications for participation in a major state economic program, the Texas Enterprise Fund, we find that a company is more likely to challenge a formal public records request if it has renegotiated the terms of the award to reduce its job-creation obligations. We interpret this as companies challenging transparency when they have avoided being penalized for noncompliance by engaging in nonpublic renegotiations. These results provide evidence regarding those conditions that prompt firms to challenge transparency and illustrate some of the limitations of safeguards such as clawbacks (or incentive-recapture provisions) when such reforms aren't coupled with robust transparency mechanisms. We speculate that the main motivation for these challenges is to limit scrutiny of these deals that could lead to backlashes against future economic development agreements.

Previous literature suggests that economic performance affects government approval asymmetrically, either because voters are quicker to blame incompetence than to credit ability (grievance asymmetry) or because they understand that the degree to which policy-makers can affect the economy varies depending on economic openness (clarity of responsibility asymmetry). We seek to understand whether these asymmetries coexist, arguing that these theories conjointly imply that globalization may have the capacity to mitigate blame for bad outcomes but should neither promote nor reduce credit to policy-makers for good economic outcomes. We look for evidence of these asymmetries in three survey experiments carried out in the USA and Canada in 2014 and 2015. We find ample experimental evidence in support of the grievance asymmetry, but our results are mixed on the impact of economic openness on blame mitigation, with some evidence of this phenomenon in the USA, but not in Canada.