A Conditional Logit Model of the Role of Local Public Services in Residential Choice

Abstract

This study develops and estimates an econometric model of choice among residential communities. The econometric method employed is maximum-likelihood estimation of a multinomial logit. This makes it possible to examine the effects of local public services and other community attributes on the residential location decisions by families. The model was estimated for six subsamples differing by household size, income, and age of head of household.

For most of the subsamples that were examined, the conclusion is that local public services and other community characteristics play only minor roles in determining the residential location choice. The major determinant of residential location is the quantity of housing services that the household can obtain in a community.

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