Wisconsin's Lavish Lure for Foxconn: An Instructional Case in Governmental Accounting

Abstract

ABSTRACTIn 2017, Wisconsin signed one of the largest U.S. business incentive contracts with Foxconn Technology Group, a Taiwanese electronics corporation best known as the main assembler of Apple's iPhone. In exchange for Foxconn's pledge to build a $10 billion manufacturing complex and hire 13,000 workers, Wisconsin's state and local governments offered more than $4 billion in subsidies. However, Foxconn's promises were unfulfilled. This case uses Wisconsin's lavish deal with Foxconn to examine the causes and complexities of targeted business incentives deployed by state and local governments. The case further analyzes Annual Comprehensive Financial Reports to assess the impact of the Foxconn project on governments' financial condition. This case is intended for courses with a governmental accounting component. It is scalable, and instructors can choose from multiple parts of the case questions according to their needs.