There are no doubt perks to being home to a huge, stable employer. But the way most cities pursue that goal—by offering to forfeit enormous amounts of tax revenues—produces outcomes that have worried many economists for years.

And while the competition that Amazon has put on is unique in its scale and fanfare, forgoing tax revenues is an all too popular way that cities try to attract even much smaller companies. In a 2012 series on incentives, The New York Times concluded that states, counties, and cities provide companies $80.4 billion per year through these arrangements. The practice of luring businesses with incentives such as tax breaks, grants, free land, and low-interest loans has become so ingrained it’s now a rote drill, complete with specialty consulting firms that help companies negotiate such giveaways.

Amazon’s beauty contest commenced shortly after Wisconsin signed a deal with Taiwan’s Foxconn, which makes products for Apple, the most valuable company in history. Wisconsin agreed to provide the Taiwanese firm with up to $3 billion in subsidies in exchange for building a new plant that would employ up to 13,000 people, at an estimated cost to the state of about $230,700 per employee if the deal reaches certain employment benchmarks. (That cost estimate may turn out to be low. The actual total incentives Wisconsin put forward now appear to include hundreds of millions more.)

“Alabama does it. Mississippi does it. Mexico,” an Ohio state legislator said to me one day back in December 2014, speaking of tax breaks and other incentives that aim to convince businesses to move to, or create, new facilities and jobs within their borders.

“But aren’t you just racing to the bottom?” I asked, thinking of dollars that would not find their way to schools, infrastructure, health care.

“We have to do it,” he answered. And he didn’t seem happy about it.

Jeffry Harris, the chief of the Area Development Foundation of Knox County, Ohio, the umbrella economic-development agency representing county and town governments, is an incentives skeptic who says he has “been watching the Amazon thing with a smirk.” “I have seen communities across Ohio make very lucrative deals to get companies to move into their community and frankly believe those communities many times overpay for that development,” he told me. Local officials want to be seen as doing something to create jobs, and to project a pro-business image. Spreading taxpayers’ dollars to prospective businesses is one easy way to do it.

But Harris believes that’s unsustainable. Better, he argues, to put more effort into community development, the school system, the workforce, the roads: “What are we doing to address the overall aesthetics of our community so when I get a Lansing, Michigan, guy coming in, downtown looks sharp? If I have a plant manager who comes through with his wife, and she says, ‘This place is terrible,’ we’ve lost that opportunity.”