Three Essays in Local Public Finance

Three Essays in Local Public Finance

Author: Ross Teichert Milton

Publisher:

Published: 2017

Total Pages: 270

ISBN-13:

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This dissertation studies local government taxation. I study whether changes in local tax levels impact alternative sources of revenue, how tax changes to fund school facilities affect property values, and how tax limits should be set to maximize the welfare of voters. In the first essay, I study private donations to public school districts, which while primarily publicly funded government entities, most districts receive. I estimate how local school taxes crowd out private, voluntary contributions to public education. To do this, I exploit quasi-experimental variation in tax revenue stemming from local elections. I collect data from a large set of referenda in which local taxes face voter approval in four Midwestern states, combined with administrative records of the sources of school district revenues. Using a regression discontinuity design around voting thresholds that determine passage of local referenda, I show that private contributions to public school systems are not crowded out by local taxes. The second essay uses variation in school facilities from local elections to approve capital investment to study whether improved school facilities change the property values of homes in Ohio. These elections allow me to use a regression discontinuity design around the voting threshold that allows school boards to issue bonds. I find no evidence that that is the case in Ohio, in contrast to other researcher's work in California. The third essay, which is joint work with Stephen Coate, studies the optimal design of fiscal limits, a common feature in local public finance, in the context of a simple political economy model. The model features a single politician and a representative voter. The politician is responsible for choosing the level of taxation for the voter but is biased in favor of higher taxes. The voter sets a tax limit before his/her preferred level of taxation is fully known. The novel feature of the model is that the limit can be overridden, with the voter's approval. The paper solves for the optimal limit and explores how it depends upon the degree of politician bias and the nature of the uncertainty concerning the voter's preferred level of taxation. ...


Essays in Political Economy and Public Finance

Essays in Political Economy and Public Finance

Author:

Publisher:

Published: 2016

Total Pages:

ISBN-13:

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These results are consistent with the view that due to their relative salience, changing tax rates is politically more difficult than changing the tax code. The third chapter reports evidence on the potential benefits to local labor markets of increasing property taxes as a source of local government revenue. The data come from three states (308 tax districts, 16 years) where tax districts reassess properties on a state-mandated staggered cycle, resulting in exogenous variation in assessments and accompanying taxes. I find that an increase in taxes due to random assessment causes economic expansion, with an increase in local population and the number of local business establishments. These effects appear to be driven by increases in government revenues and expenditures, rather than by changes in borrowing behavior. These results suggests that property taxes are too low in this sample of states.


Three Essays in Public Economics

Three Essays in Public Economics

Author: Daniel Snedaker Bennett

Publisher:

Published: 2019

Total Pages:

ISBN-13:

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The research presented in this dissertation answers questions about some of the most important and popular public services provided by the federal government and local governments in the United States. At the local level, I examine issues that determine how efficiently police services are provided, and at the federal level, I provide evidence to help explain why Social Security has been so hard to reform. In Chapter 2, I measure how the degree to which police are fragmented impacts police efficiency, and how the characteristics of the communities that police serve impact the efficiency of service that those communities receive. I assembled a unique dataset of every event recorded by the Computer Aided Dispatch systems of 40 different police agencies from December of 2015 to January of 2016 to measure police efficiency by their response times to public calls for service. Using the detailed geographic information provided by these systems, I geocode the calls, match them to the census block group from which they originate, and calculate a predicted response time based on the optimal placement of police response units using a Maximum Covering Model with capacity constraints. I find that minority communities can expect slower response times on average for lower priority calls, but there is considerable heterogeneity across jurisdictions. In areas with less fragmented law enforcement, response times are significantly faster for calls requiring an immediate response. Chapter 3 investigates how public scrutiny following some recent high profile lethal encounters with police impacts police behavior. Since 2014, there has been wide spread speculation that negative media coverage of instances in which police use force has a ``Ferguson Effect, " or a de-policing effect in which officers exert less effort causing an increase in crime rates. I the use unique data described in Chapter \ref{chapter:FergussonEffect} to directly measure how officer initiated events change in response to high profile events. I also use the most recent data from the FBI's Uniform Crime Reports to compare estimates from studies examining shootings in 2014 with other high profile events in the following years. The balance of the evidence suggests that there is a modest de-policing effect with minimal to no impact on the aggregate crime rates. Chapter 4 was co-authored with Michael Boskin and Diego Perez, and examines the political economy of Social Security Reform. It has been known for decades that Social Security is facing a financial crisis and soon will only be able to pay 71\% of benefits. We calculated the expected net present value of Social Security taxes, benefits and transfers for 112 worker-beneficiary groups under several proposed reforms covering the unfunded liabilities. We identified which reforms receive support when people vote in their financial self-interest under alternative economic and demographic projections and voting proclivity assumptions. While 40\% of voters have a negative lifetime net transfer, less than 10\% have a negative future transfer under the unsustainable status quo. So framing the problem as a choice between reforms is necessary for any reform to receive support. Delayed reforms are often preferred, but immediate reform is possible, whether tax hikes or slowing benefit growth depends upon whether SSA or CBO assumptions are used. Alternative representations of the interests of younger voters strongly affect preferred reforms. Intergenerational AND intragenerational heterogeneity of economic interests combine to enable coalitions employing side payments between voters to affect which reforms are blocked and which are feasible.


The Economics of Public Finance

The Economics of Public Finance

Author: Alan S. Blinder

Publisher: Atlantic Publishers & Distri

Published: 1974

Total Pages: 464

ISBN-13:

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Monograph on public finance in the USA - includes essays on (1) analytical foundations of fiscal policy, (2) the incidence and economic implications of taxation, (3) public expenditure budgeting, and (4) state-local finance and intergovernmental fiscal relations. Graphs and references.