Property tax limits, local fiscal behavior, and property values: evidence from Massachusetts under Proposition

Bradbury, Katharine L.; Mayer, Christopher; Case, Karl E.

doi:10.1016/s0047-2727(00)00081-5

Cited by 131 publications

(106 citation statements)

References 21 publications

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“…28 We must caution that the role that local governments play in financing public elementary and secondary education varies widely across states, as does the nature of budget referenda, if they occur. For example, under proposition 2 ½ in Massachusetts, school budget referenda only take place if local school board want to propose local school budgets that will effective property tax rates to exceed 2.5% or that will cause property tax rates to rise at rates more than 2.5 percentage points a year (Bradbury, Mayer and Case, 2001). We also must caution that, as we have noted earlier, our panel data analyses may be subject to selection bias because our sample of school districts is not a random sample of all school districts in the state.…”

Section: Discussionmentioning

confidence: 99%

Why Do School District Budget Referenda Fail?

Ehrenberg

Ehrenberg²,

Smith

et al. 2004

Educational Evaluation and Policy Analysis

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Abstract[Excerpt] Public elementary and secondary education is financed in many states at least partially at the local level and school district budgets in many states are determined by voter referenda. To date, however, there have been no studies that sought to explain why the proportion of school district budget proposals in a state that are approved by voters in referenda varies over time. Similarly no research has used panel data on school districts to test whether budget referenda failures are concentrated in a small number of school districts within a state and whether the failure of a budget referendum in a school district in one year influences the likelihood that voters in the district subsequently defeat a budget referendum in the next year.

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Section: Discussionmentioning

confidence: 99%

Why Do School District Budget Referenda Fail?

Ehrenberg

Ehrenberg²,

Smith

et al. 2004

Educational Evaluation and Policy Analysis

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“…Evidence suggests that while limits on personal property taxation have curtailed spending (Cutler, Elmendorf et al 1999;Bradbury, Mayer et al), they have also made Massachusetts local governments more dependent on other local sources of revenues. 9 Galles and Sexton (1998), for example, suggest that increases in non-tax revenue may have returned spending to pre-Proposition 2 ½ levels.…”

Section: Background On Institutions and Officer Strictnessmentioning

confidence: 99%

More Tickets, Fewer Accidents: How Cash-Strapped Towns Make for Safer Roads

Makowsky

Stratmann

2011

The Journal of Law and Economics

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Traffic accidents are one of the leading causes of injury and death in the U.S. The role of traffic law enforcement in the reduction of accidents has been studied by relatively few papers and with mixed results that may be due to a simultaneity problem. Traffic law enforcement may reduce accidents, but police are also likely to be stricter in accidentprone areas. We use municipal budgetary shortfalls as an instrumental variable to identify the effect of traffic citations on traffic safety and show that budgetary shortfalls lead to more frequent issuance of tickets to drivers. Using a panel of municipalities in Massachusetts, we show that increases in the number of tickets written reduce motor vehicle accidents and accident related injuries, and that tickets issued to younger drivers have a larger effect in reducing accidents. The findings show that failure to control for endogeneity results in a significant underestimation of the positive impact of law enforcement on traffic safety.

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“…For property taxes, Bradbury et al (2001) analyze the effect of property tax limits in the US on house prices. The results suggest that tax cuts due to the limits reduce house prices, presumably because of inefficient reductions in local services.…”

Section: Introductionmentioning

confidence: 99%

“…That property prices do not fall significantly after property tax hikes suggest that the owners of the properties do not bear the burden of property taxation. This conclusion is plausible if the higher revenues are used by local governments to improve local services (Bradbury et al, 2001) or to reduce fiscal deficits and thereby future tax rates (Stadelmann and Eichenberger, 2014).…”

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confidence: 99%

The Revenue and Base Effects of Local Tax Hikes: Evidence from a Quasi-Experiment

Baskaran

2015

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may THE REVENUE AND BASE EFFECT OF LOCAL TAX HIKES: EVIDENCE FROM A QUASI-EXPERIMENT Thushyanthan BaskaranThe revenue and base effects of local tax hikes:Evidence from a quasi-experimentThushyanthan Baskaran * thushyanthan.baskaran@gmail.com AbstractThis paper studies the revenue and base effects of local property and business tax hikes using a natural experiment in the German state of North Rhine-Westphalia (NRW). Due to a reform of the local equalization scheme in 2003, a set of municipalities in NRW increased their local tax rates by one to two percentage points while the remaining municipalities kept their rates constant. Using this variation across municipalities and over time to implement a difference-in-differences design covering the period 1995-2010, I find that property tax hikes have a revenue elasticity of unity and no adverse base effects. Business tax hikes have no discernible base effects but also no statistically significant effect on revenues. Furthermore, the results suggest that the tax hikes have no effect on broader economic outcomes such as local employment, firms' wage bill, and property prices. Overall, increasing local tax rates by one to two percentage points does not seem to affect the local economy adversely.

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Property tax limits, local fiscal behavior, and property values: evidence from Massachusetts under Proposition

Cited by 131 publications

References 21 publications

Why Do School District Budget Referenda Fail?

Why Do School District Budget Referenda Fail?

More Tickets, Fewer Accidents: How Cash-Strapped Towns Make for Safer Roads

The Revenue and Base Effects of Local Tax Hikes: Evidence from a Quasi-Experiment

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