Last year, video game companies earned over $20 billion in revenue last year in the U.S.—and with expansion into mobile and tablet devices those profits are expected to grow. The promise of a consistent multi-billion dollar revenue stream makes gaming an alluring industry for many cash-strapped states who are hungry to get a piece of the action. But, points out Calvin H. Johnson, a professor at the University of Texas at Austin, several studies have called into question the effectiveness of these programs—a 2013 analysis done by the Tax Foundation found that film tax incentives only generate 30 cents in tax revenue for every dollar spent.
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