Government, Effectiveness, Performance and Local Property Values

Steven Deller () and Craig Maher

No 12638, Staff Papers from University of Wisconsin-Madison, Department of Agricultural and Applied Economics

Abstract: We offer a practical test of local government effectiveness in the provision of public services. Building on the work of Brueckner (1979, 1982, 1983) and Henderson (1990, 1995) we offer a property value maximization model where levels of local public services are capitalized into property values. Using data for Wisconsin municipalities we demonstrate that service expenditure levels, and corresponding taxation levels, should be increased. In other words, the property value maximization test suggests that local public services in Wisconsin are consistently under-provided. By monitoring local property values officials can objectively determine if public services are being provided in an optimal manner.

Keywords: Land; Economics/Use (search for similar items in EconPapers)
Pages: 23
Date: 2005
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Working Paper: Government, Effectiveness, Performance and Local Property Values (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:wisagr:12638

DOI: 10.22004/ag.econ.12638

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