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“Causes of Sprawl”: A (Further) Public Finance Extension

Melville McMillan ()

No 2018-4, Working Papers from University of Alberta, Department of Economics

Abstract: There are good reasons to expect that attributes of local public finance may impact urban land use and, specifically, sprawl. A detailed and novel investigation of U.S. metropolitan areas (Burchfield et al., 2006) provides substantial insights into the causes of sprawl, but it overlooks the main characteristics of local public finance (taxes and user charges). Using a subset of the data matched to city public finance data, a parallel analysis yielded evidence that greater reliance on local property taxes reduces sprawl and suggested that user charges (primarily for water, sewerage and solid waste services) could have a similar effect (McMillan, 2016). Expansion of the local public finance data set allowed extension of the data analyzed from 83 to 109 observations. The subsequent analysis was expected to enable a refinement of the estimates made in the 2016 paper. However, analysis of the extended data set as reported in this paper indicates more nuanced results. In particular, the impacts of property taxes on sprawl depend upon the population of the metropolitan area.

Keywords: urban sprawl; local taxes; property taxes (search for similar items in EconPapers)
JEL-codes: H71 R51 R52 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ure
Date: 2018-03-21
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