This damning review comes from Harvard Business School marketing expert John Quelch, in a blog post on Harvard Business Publishing.
"The Federal government should not be in the business of initiating and administering short-term incentive programs designed to shape consumer purchase behavior. It has no experience in such initiatives and proved itself incapable of forecasting demand associated with different incentive levels."Where did government fail? Quelch says the size of the rebate, up to $4,500, was way too large and resulted in taxpayers subsidizing car deals that would have occurred anyway. And government-imposed bureacuracy means administration costs might reach 10 percent of program costs.
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