The data-center gold rush has marched into local communities on one familiar promise: Big Tech brings jobs, growth, and prosperity.
A new 75-page academic working paper found something very different.
Finance scholars Liu Ee Chia, Jess Cornaggia, David Haushalter, and Qiang Wang compared U.S. counties with operational data centers against “near-miss” counties that attracted proposals but never got operating facilities.
They found little corresponding improvement in fiscal capacity, local employment, or business formation.
Instead, local-government borrowing costs climbed as data-center development grew. Water-bond yields rose 26 basis points more in water-scarce counties than in water-abundant counties.
The paper also found higher school-bond yields in major data-center hubs, where housing-price growth slowed. The authors said those patterns aligned with a weaker expected property-tax base.
“Overall, we conclude that investment without labor strains public infrastructure without generating widespread agglomeration gains.” — Liu Ee Chia, Jess Cornaggia, David Haushalter, and Qiang Wang
Saagar Enjeti highlighted the study’s bottom line: data centers can pull capital and utilities into a county without delivering the broad labor-market gains that politicians and corporate developers sell.
Hellbound and Down 