Using survey data to study capitalization of local public services

Fredrik Carlsen, Jorn Rattso, Bjørg Langset and Lasse Stambøl
Additional contact information
Bjørg Langset: Research Department, Statistics Norway
Lasse Stambøl: Research Department, Statistics Norway

Working Paper Series from Department of Economics, Norwegian University of Science and Technology

Abstract: We use surveys in which respondents evaluate local amenities in Norway to compute proxy variables for the quality of local public services as well as other local amenities relevant to location decisions. Average satisfaction reported by the respondents is computed for each amenity and each municipality, adjusted for sample variation in personal characteristics and included as explanatory variables in a cross-section study of house prices. We find that house prices are increasing in satisfaction with health care, cultural activities and public transportation, suggesting that the quality of local public services indeed affects the attractiveness of a residential site. When the analysis is repeated with input measures of service levels instead of satisfaction variables, we find no effects of local public services on house prices, indicating that traditional Tiebout studies based on input measures may have underestimated the importance of local public services for location decisions.

Keywords: Capitalization; Local public services; Survey data (search for similar items in EconPapers)
JEL-codes: R23 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2006-05-18
New Economics Papers: this item is included in nep-geo, nep-lab and nep-ure
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http://www.svt.ntnu.no/iso/WP/2006/17amenities_houseprices.pdf (application/pdf)

Related works:
Journal Article: Using survey data to study capitalization of local public services (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:nst:samfok:8106

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