The Importance of Local Fiscal Conditions in Analyzing Local Labor Markets

Joseph Gyourko and Joseph Tracy

Journal of Political Economy, 1989, vol. 97, issue 5, 1208-31

Abstract: A new test of the compensating wage differential model is proposed. The logic behind Jennifer Roback's model, which shows how differences in nonproduced amenities may be reflected in intercity wage differentials, is extended to the case of differences in local fiscal conditions, represented by tax rates and publicly produced services. Results show that differences in local tax rates and services provisions do generate compensating wage differentials across cities. The effects of a particularly large set of taxes and effective services output measures are examined. Differences in local fiscal conditions are shown to play important roles in explaining the variance in intermetropolitan wages. Copyright 1989 by University of Chicago Press.

Date: 1989
References: Add references at CitEc
Citations: View citations in EconPapers (122)

Downloads: (external link)
http://dx.doi.org/10.1086/261650 full text (application/pdf)
Access to full text is restricted to subscribers. See http://www.journals.uchicago.edu/JPE for details.

Related works:
Working Paper: The Importance of Local Fiscal Conditions in Analyzing Local Labor Markets (1986)
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:ucp:jpolec:v:97:y:1989:i:5:p:1208-31

Access Statistics for this article

More articles in Journal of Political Economy from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().