State governments in the United States grant billions of dollars' worth of tax incentives each year to encourage companies to build plants or create jobs, but a recent study suggests policy makers are failing to assess the effectiveness of those tax breaks.

The report released last week by the Pew Center on the States says just 13 states are doing a good job of evaluating their incentives. Twelve states are doing a "mixed" job, Pew says, while the remaining 25, along with the District of Columbia, meet none of the criteria set out in its study.

Pew sees shortcomings even among the states it views as leading-edge, though. "We found that no state ensures that its policy makers have the evidence they need to determine whether incentives are effective," says Jeff Chapman, a senior researcher at Pew.

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Susan Kelly

Susan Kelly is a business journalist who has written for Treasury & Risk, FierceCFO, Global Finance, Financial Week, Bridge News and The Bond Buyer.