This study tests the hypothesis that municipal unions, through the use of political power and multilateral bargaining power, are able to increase the demand for municipal services. An analysis of data on approximately 700 cities from the 1980 Survey of Governments and Census of Population shows, in both cross-section and fixed effects estimates, that collective bargaining increased expenditures in departments covered by a contract. In contrast, collective bargaining apparently did not affect cities' total expenditures, total revenues, or property taxes.
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