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on Urban and Real Estate Economics |
| By: | Donald , Vandegrift; Michael, Lahr |
| Abstract: | This paper examines the effect of public acquisitions of open space on house prices and the municipal tax base. While a series of studies show that open space acquisitions raise values of nearby properties, no research to date appears to focus upon the effect of open space acquisitions upon local tax base. Existing studies focus on the effect of open space acreage on house prices. We examine the effect of open space expenditures on house prices at the municipal level. We find that a one-dollar increase in open space expenditures per housing unit is associated with average house prices that are about $13 higher and with a tax base that is about $15 lower per acre. Open space expenditures per housing unit also show a consistent positive effect on the percentage change in house prices over the period 1995-2000. However, we find no statistically significant effect from open space expenditures on the percentage change in the tax base over the period 1995-2000. Local funding (rather than state funding) for open space has a smaller impact on house prices but the effect is significant only in some specifications. Despite the negative effect of open space purchases on the tax base, we find that higher open space expenditures are associated with lower tax rates. In addition, we find that while higher tax rates are associated with a lower tax base, a larger tax base does depress tax rates. The percentage change in the general property tax rate over the period 1995-2000 shows a significant negative effect on the percentage change in the tax base per acre over the period. |
| Keywords: | Open Space; Tax Base; Municipality; Tax Rate |
| JEL: | H4 H2 R51 R52 |
| Date: | 2007–09–24 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:6118&r=ure |
| By: | Amihai Glazer (Department of Economics, University of California-Irvine); Hiroki Kondo (Department of Economics, Shinshu University) |
| Abstract: | We consider cities which can increase the income of landowners or of capital owners by improving the quality of public services. The improvement can come from innovation or from imitation. We find that when cities aim to benefit landowners, too many cities innovate; but too few cities innovate when the city aims to benefit capital owners. Redistribution across cities can ameliorate these inefficiencies. |
| Keywords: | Tax competition; Innovation; Interjurisdictional differences |
| JEL: | R13 H73 |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:irv:wpaper:070807&r=ure |
| By: | Paul J. Boyle (Max Planck Institute for Demographic Research, Rostock, Germany); E. Graham; Z. Feng |
| Abstract: | This study links empirical analysis of geographical variations in fertility to ideas of contextualising demography. We examine whether there are statistically significant clusters of fertility in Scotland between 1981 and 2001, controlling for more general factors expected to influence fertility. Our hypothesis, that fertility patterns at a local scale cannot be explained entirely by ecological socio-economic variables, is supported. In fact, there are ‘unexplained’ local clusters of high and low fertility, which would be masked in analyses at a different scale. We discuss the demographic significance of local fertility clusters as contexts for fertility behaviour, including the role of the housing market and social interaction processes, and the residential sorting of those displaying or anticipating different fertility behaviour. We conclude that greater understanding of local geographical contexts is needed if we are to develop mid-level demographic theories and shift the focus of fertility research from events to processes. |
| Keywords: | Scotland, fertility, geography |
| JEL: | J1 Z0 |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:dem:wpaper:wp-2007-036&r=ure |
| By: | Albert Solé-Ollé (Institut d'Economia de Barcelona (IEB); Universitat de Barcelona (UB)); Elisabet Viladecans-Marsal (Institut d'Economia de Barcelona (IEB); Universitat de Barcelona (UB)) |
| Abstract: | We examine the economic and political determinants of decisions taken by local governments regarding the amount of new land to be assigned for development. The analysis draws on a massive database, which includes more than 2,000 Spanish municipalities during the 1999-2003 term-of-office. The increase in developable land in this period is explained using a wide set of variables that capture the specific traits of each municipality in 1999. The variables were selected following a review of recommendations made in the literature on urban growth controls and by taking into account other factors that might be considered specific to Spain. Our results show that urban expansion is influenced by a variety of factors. Thus, the communities found to be expanding most: (i) are rich, (ii) have more new housing purchasers, (iii) are in a weak financial position, (iv) are controlled by parties to the right of the political spectrum, (v) have a low electoral turnout and local government bodies that do not face serious electoral competition, and (vi) have more land but a lower proportion of environmentally valuable land. |
| Keywords: | Land-use regulations, urban growth controls, political economy |
| JEL: | H7 Q15 R52 |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:ieb:wpaper:2007/11/doc2007-5&r=ure |
| By: | John B. Horowitz (Department of Economics, Ball State University); Stanley R. Keil (Department of Economics, Ball State University); Lee C. Spector (Department of Economics, Ball State University) |
| Abstract: | Taxpayers are concerned that introducing a charter school in their neighborhood will decrease their property values. We test this proposition by using three methods. We test the size and significance of the distance from a charter school with respect to property values; weather the intervention of a charter school changes the forecasted value of the property; and if the distance from a charter school has a different impact than the distance from a public school in similar neighborhoods. For the most part, we find little evidence that the existence of a charter school affects property values. |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:bsu:wpaper:200707&r=ure |
| By: | Michael A. Stegman; Allison Freeman; Jong-Gyu Paik |
| Abstract: | The distribution of wealth in the United States is more highly skewed than the distribution of income. Nowhere is this clearer than in the case of homeowners and renters. Those who own their homes typically have about 20 to 40 times more net wealth than those who rent. ; Although home equity plays a role in this growing disparity, it does not fully explain why renters hold fewer assets than homeowners. Even excluding home equity, renters are more than twice as likely to be asset-poor as are homeowners. Renters also hold a smaller range of assets than owners, suggesting that homeownership "implies more than home equity, and is associated with the ownership of a wide range of financial assets". |
| Keywords: | Home ownership ; Rental housing ; Wealth |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfcw:2007-02&r=ure |
| By: | R. Wenting; K. Frenken |
| Abstract: | Few industries are more concentrated than the global fashion industry. We analyse the geography and evolution of the ready-to-wear fashion design industry by looking at the yearly entry rates following an organizational ecology approach. In contrast to earlier studies on manufacturing industries, we find that legitimation effects are local and competition effects are global. This result points to the rapid turnover of ideas in fashion on the one hand and the global demand for fashion apparel on the other hand. We attribute the decline of Paris in the post-war period to 'institutional lock-in', which prevented a ready-to-wear cluster to emerge as vested interested of haute couture designers were threatened. An extended organizational ecology model provides empirical support for this claim. |
| Keywords: | Organizational ecology, fashion industry, creative industries, clusters, institutional lock-in Length 22 pages |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2007-14&r=ure |
| By: | Viviana Fernández |
| Abstract: | Spatial dependency has been broadly studied in several research areas, such as environmental criminology, economic geography, environmental sciences, and urban economics. However, it has been essentially overlooked in other subfields of economics and in the field of finance as a whole. A key element at stake is the definition of contiguity. In the context of financial markets, defining a metric distance is not a simple matter. In this article, we explore the notion of spatial dependency in a panel of 126 Latin American firms from Brazil, Chile, and Mexico over the period 1997-2006. Firstly, we formulate a spatial version of the capital asset pricing model (S-CAPM), which accounts for alternative measures of distance between firms, such as market capitalization, the market-to-book, enterprise value-to-EBITDA, and the debt ratios. Secondly, we analyze the potential existence of spatial linkages in investment and dividend decisions. We conclude that there may be contemporaneous linkages in firms’ decisions of such ratios, which may be indicative of some strategic behavior. |
| Date: | 2007–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:iis:dispap:iiisdp234&r=ure |
| By: | Seungjin Han and John Leach |
| Abstract: | This paper develops a model in which competing governments offer financial incentives to induce individual firms to locate within their jurisdictions. Equilibrium is described under three specifications of the supplementary taxes. There is no misallocation of capital under two of these specifications, and there might or might not be capital misallocation under the third. This result contrasts strongly with that of the standard tax competition model, which does not allow governments to treat firms individually. That model finds that competition among governments almost always leads to capital misallocation. |
| Keywords: | tax competition, bargaining |
| JEL: | C7 H2 H4 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:mcm:deptwp:2007-09&r=ure |
| By: | Lili Xie (Department of Economics, Ball State University) |
| Abstract: | This paper examines the e®ects of bank mergers on loan pricing. Using a sample of U.S. commercial and industrial loans, I ¯nd that banks reduce loan interest rates after they acquire target banks with small market shares, suggesting that the e±ciency gains e®ect dominates the market power e®ect in such mergers. This merger e®ect is largest in the ¯rst year and almost disappears by the third year after the merger. Ex-ante conditions such as the concentration of the banking market and the market overlap of merging banks signi¯cantly a®ect merger e®ects in ways consistent with theory predictions. Merger e®ects are also found to vary across ¯rms: mergers lead to larger rate reductions for informationally opaque ¯rms than for informationally transparent ¯rms. This provides counter evidence for the concern that bank mergers will particularly hurt ¯rms lacking high-quality quantitative information. Although merging banks reduce their loan interest rates, rival banks, i.e., banks located in the same markets as the merging banks, leave their loan interest rates unchanged after mergers occur. This can be attributed to the fact that rival banks do not get e±ciency gains as merging banks do and thus do not ¯nd it pro¯table to follow the pricing change of merging banks. |
| Keywords: | Bank Merger, Economies of Scale, Economies of Scope, and Market Power. |
| JEL: | G21 L40 |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:bsu:wpaper:200706&r=ure |
| By: | Attila Ambrus (Harvard University); Markus Mobius (Harvard University); Adam Szeidl (University of California, Berkeley) |
| Abstract: | We build a model of informal risk-sharing among agents organized in a social network. A connection between individuals serves as collateral that can be used to enforce insurance payments. We characterize incentive compatible risk-sharing arrangements for any network structure, and develop two main results. (1) Expansive networks, where every group of agents have a large number of links with the rest of the community relative to the size of the group, facilitate better risk-sharing. In particular, “two-dimensional” village networks organized by geography are sufficiently expansive to allow very good risk-sharing. (2) In second-best arrangements, agents organize in endogenous “risksharing islands” in the network, where shocks are shared fully within but imperfectly across islands. As a result, risk-sharing in second-best arrangements is local: socially closer agents insure each other more. In an application of the model, we explore the spillover effect of development aid on the consumption of non-treated individuals. |
| Date: | 2007–11 |
| URL: | http://d.repec.org/n?u=RePEc:ads:wpaper:0079&r=ure |
| By: | Enrique Lopez-Bazo (Faculty of Economics, University of Barcelona); Rosina Moreno (Faculty of Economics, University of Barcelona) |
| Abstract: | This paper provides novel empirical evidence of the indirect effect of educational attainment on regional economic growth, through its influence on the profitability of investment in physical capital. We test the hypothesis that the regional heterogeneity of the return to physical capital can be directly related to the existing heterogeneity in the educational attainment of workers. The results for the Spanish case support our hypothesis that the higher the educational attainment of workers the greater the returns on investment in physical capital. In fact, this effect seems to be sufficiently strong to have counterbalanced the traditional mechanism of decreasing returns to capital accumulation. |
| Keywords: | returns to capital, human capital, productivity, cost system |
| JEL: | J24 O11 O47 R11 |
| Date: | 2007–12 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:200718&r=ure |