 Does Highway Accessibility Influence Local Tax Factors? Evidence from German MunicipalitiesLuisa Dörr and Stefanie Gäbler No 321, ifo Working Paper Series from ifo Institute - Leibniz Institute for Economic Research at the University of Munich Abstract: We examine how highway accessibility influences tax policy. We exploit the stagewise expansion of the “Baltic Sea highway” in the East German state Mecklenburg-Western Pomerania as the largest contiguous highway construction project in Germany since 1945. For non-agglomeration municipalities that lie on a convenient route between two larger cities the access and opening year are close to random. Results from difference-in-differences estimations and an event study approach show that highway access influences local tax setting in municipalities within 5 to 10 km road distance. Improved accessibility increases property tax factors persistently by roughly 6 percentage points. Our effects are driven by peripheral municipalities, while we do not find an influence on core municipalities. Additionally, improved accessibility gives rise to a shift of population and economic activity from the periphery to the core. Keywords: Highway; infrastructure; accessibility; tax factors; municipalities; local governments (search for similar items in EconPapers) There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ces:ifowps:_321 Access Statistics for this paper More papers in ifo Working Paper Series from ifo Institute - Leibniz Institute for Economic Research at the University of Munich Contact information at EDIRC. |
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