Fiscal Crises in the US Cities: Structural and Non-Structural Causes

Guntram Wolff

The IUP Journal of Public Finance, 2008, vol. VI, issue 1, 7-51

Abstract: Financial difficulties of the US cities have recently become a major issue of concern. However, there is little agreement on why certain cities experience crises while others do not. Two arguments are put forward: Cities suffer from: (1) structural problems like high immigration, congestion, etc.; and (2) non-structural political problems like the weakness of the mayor, union-power, etc. Starting from a common pool model of municipal goods we estimate demand equations for spending and debt with structural variables. The estimation is based on 900 US cities in 1985, 1991 and 1999. Structural factors predicted by the model explain most of the variation of spending and debt levels. Furthermore coefficients are stable over time. However, excessively high debt burdens as indicators of potential crisis and high spending levels are outliers and not explained by structural factors.

Date: 2008
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Working Paper: Fiscal Crises In U.S. Cities: Structural And Non-Structural Causes (2004)
Working Paper: Fiscal crises in US cities: Structural and non-structural causes (2004)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:icf:icfjpf:v:06:y:2008:i:1:p:7-51

Access Statistics for this article

More articles in The IUP Journal of Public Finance from IUP Publications
Bibliographic data for series maintained by G R K Murty ().