This research investigates factors influencing policy adoption of tax incentive programs related to economic development in Florida local governments in terms of political market theory. By employing political market theory, this research emphasizes local politics, fiscal and interest group factors. Furthermore, this study utilizes two analyses: 1) a logistic regression examines local contextual factors influencing the adoption of tax incentive programs, and 2) an OLS model is conducted to investigate the effects of selected factors on the adoption of a number of tax incentive programs among local governments which have already adopted at least one tax incentive program. Statistical findings support the significant influence of political and interest group factors on tax incentive program adoption. More specifically, local governments that have an appointed manager have a high probability of adopting the tax incentive program, also the number of local business groups in local governments is positively related to a greater number of tax incentive programs.