The Demand for Local Public Services in Sweden

Mikael Witterblad ()
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Mikael Witterblad: Department of Economics, Umeå University, Postal: S 901 87 Umeå, Sweden

No 730, Umeå Economic Studies from Umeå University, Department of Economics

Abstract: This paper analyzes the composition of municipal expenditures in Sweden by estimating a demand system for local public services, in which tax revenue collection is treated as endogenous. The estimation is based on the QAIDS specification. The empirical application uses panel data for the period 1998-2005 and for six local public services. The results show that the point estimates of all income elasticities except one are positive, and that none of them significantly exceeds one. Furthermore, the point estimates of the own-price elasticities are negative and less than one in absolute value for all services.

Keywords: Demand system; local public finance; local government spending (search for similar items in EconPapers)
JEL-codes: D12 H71 H72 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-pbe, nep-pub and nep-ure
Date: Written 2008-03-10
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