The authors test the hypothesis that there is significant spatial mismatch between property taxation and capital investment in inner, middle, and suburban parts of the city of Phoenix. They empirically test a hedonic model of assessed valuation of homes and find that a typical suburban house within Phoenix city limits bears a lower tax burden than the same house in the inner city. Their study also demonstrates that suburban areas receive 40% to 100% more per household in specific capital improvement monies than the average household in the city. The results suggest a cross-subsidization of suburban growth by inner-city dollars.
Get full access to this article
View all access options for this article.
References
1.
Adler, J.1995. Bye bye suburban dream. Newsweek, 15 May, 41-45.
2.
Angotti, T.1993. Metropolis 2000. New York: Routledge Kegan Paul.
3.
Antunes, G. , and J. Plumlee. 1977. The distribution of urban public service: Ethnicity, socioeconomic status, and bureaucracy as determinants of the quality of neighborhood streets. Urban Affairs Quarterly12:313-332.
4.
Asher, C.1992. Hedonic analysis of reliability and safety for new automobiles. Journal of Consumer Affairs26:377-398.
5.
Bland, R. L. , and S. Nunn. 1992. The impact of capital spending on municipal operating budgets. Public Budgeting & Finance (Summer): 32-47.
6.
Bish, R. L. , and V. Ostrom. 1979. Understanding urban government: Metropolitan reform reconsidered. Washington, DC: American Enterprise Institute for Public Policy Research.
7.
Boyle, J. , and D. Jacobs. 1982. The intracity distribution of services: A multivariate analysis. American Political Science Review76:371-379.
8.
Braid, R. M.1991. Residential spatial growth with perfect foresight and multiple income groups. Journal of Urban Economics30:385-407.
9.
Brueckner, J. K.1982. Atest for allocative efficiency in the local public sector. Journal of Public Economics1:25-43.
10.
Butler, J. Q.1996. Arizona real estate industry tops expectations for 1995. In Arizona business. Tempe, AZ: L. Wlliam Seidman Research Institute, College of Business, Arizona State University.
11.
Byrum, O. E.1992. Old problems in new times: Urban strategies for the 1990s. Chicago: American Planning Association.
12.
Chatteree, S. , and B. Price. 1977. Regression analysis by example. New York: John Wiley.
13.
DiPasquale, D. , and W. C. Wheaton. 1996. Urban economics and real estate markets. Englewood Cliffs, NJ: Prentice Hall.
14.
Downs, A.1994. New visions for metropolitan America. Washington, DC: Brookings Institution.
15.
Ellickson, R.1977. Suburban growth controls: An economic and legal analysis. Yale Law Journal86:385-511.
16.
Epple, D. , A. Zelenitz, and M. Visscher. 1978. A search for testable implications of the Tiebout hypothesis. Journal of Political Economy86:405-425.
17.
Fernandez-Cornejo, S.1995. Quality-adjusted price and quantity indices for pesticides. American Journal of Agricultural Economics77:645.
18.
Fink, M.1993. Toward a sunbelt urban design manifesto. Journal of the American Planning Association59:3-8.
19.
Frieden, B.1980. Allocating the public service costs of new housing. Urban Land39:12-16.
20.
Fullerton, D. , and R. H. Gordon. 1983. A reexamination of tax distortions in general equilibrium models. In Behavioral simulation methods in tax policy analysis in the 1980s, edited by M. S. Feldstein, 369-420. Chicago: Univ. of Chicago Press.
21.
Fullerton, D. , and Y. Henderson. 1984. Incentive effects of taxes on income from capital: Alternative policies in the 1980s. In The legacy of Reaganomics: Prospects for long-term growth, edited by C. R. Hulten and I. V. Sawhill, 45-89. Washington, DC: Urban Institute.
22.
Gakenheimer, R.1989. Infrastructure shortfall: The institutional problems. Journal of the American Planning Association55:14-23.
23.
Garreau, J.1991. Edge city: Life on the newfrontier. New York: Doubleday.
24.
Greene, W. H.1997. Econometric analysis. Upper Saddle River, NJ: Prentice Hall.
25.
Griliches, Z.1958. The demand for fertilizer: An econometric interpretation of technical change. Journal of Farming Economics40:591-606.
26.
Griliches, Z.1964. Notes on the measurement of price and quantity indices. In Models of income distribution. New York: National Bureau of Economic Research.
27.
Hanson, M. E.1992. Automobile subsidies and land use: Estimates and policy responses. Journal of the American Planning Association58:60-71.
28.
Hawkins, B. W. , and R. M. Hendrick. 1994. Do county governments reinforce city-suburban inequalities? A study of city and suburban service allocations. Social Science Quarterly75:755-771.
29.
Ihlanfeldt, K. R.1994. The importance of the central city to the regional and national economy: Areview of the arguments and empirical evidence. Atlanta: Policy Research Center, Georgia State University. Mimeo.
30.
Kelly, E. D.1993. Managing community growth. Westport, CT: Praeger.
31.
Levy, F. , A. Meltsner, and A. Wildavsky. 1974. Urban outcomes: Schools, streets, and libraries. Berkeley: Univ. of California Press.
32.
Lineberry, R.1977. Equality and urban policy. Beverly Hills, CA: Sage.
33.
MacEachern, D.1995. Who really bears costs of fringe development?Tribune, 5 December, A1.
34.
Man, J. Y. , and M. E. Bell. 1996. The impact of local sales tax on the value of owner-occupied housing. Journal of Urban Economics39:114-130.
35.
Massey, D. S. , and N. A. Denton. 1988. Suburbanization and segregation in the U.S. metropolitan areas. American Journal of Sociology94:592-626.
36.
Mieszkowski, P. , and E. S. Mills. 1993. The causes of metropolitan suburbanization. Journal of Economic Perspectives7:135-147.
37.
Mladenka, K. R. , and K. Q. Hill. 1977. The distribution of benefits in an urban environment: Parks and libraries in Houston. Urban Affairs Quarterly13:73-94.
38.
Oates, W. E.1969. The effects of property taxes and local public spending on property values: An empirical study of tax capitalization and the Tiebout hypothesis. Journal of Political Economy77:957-971.
39.
Orum, A. M.1995. City building in America. Boulder, CO: Westview.
40.
Palen, J. J.1995. The suburbs. New York: McGraw-Hill.
41.
Palmquist, R. B.1989. Land differentiated factor of production: A hedonic model and its implications for welfare measurement. Land Economics65:23-28.
42.
Perry, C.1929. Neighborhood and community planning: The neighborhood unit. New York: Regional Plan of New York and Its Environs.
43.
Phoenix, City of . 1981. 1981-86 Capital Improvement Program. Phoenix, AZ: Office of the City manager.
44.
Phoenix, City of . 1985. 1985-90 Capital Improvement Program. Phoenix, AZ: Office of the City Manager.
45.
Phoenix, City of . 1989. 1989-94 Capital Improvement Program. Phoenix, AZ: Office of the City Manager.
46.
Phoenix, City of . 1991. 1991-98 Capital Improvement Program. Phoenix, AZ: City of Phoenix Budget and Research Department.
47.
Phoenix, City of . 1992. 1992-99 Capital Improvement Program. Phoenix, AZ: City of Phoenix Budget and Research Department.
48.
Phoenix, City of . 1993. 1993-2000 Capital Improvement Program. Phoenix, AZ: City of Phoenix Budget and Research Department.
49.
Phoenix, City of . 1994. 1994-2001 Capital Improvement Program. Phoenix, AZ: City of Phoenix Budget and Research Department.
50.
Phoenix, City of . 1995.1995-2002 Capital Improvement Program. Phoenix, AZ: City of Phoenix Budget and Research Department.
51.
Phoenix, City of . 1995. 1995-96 Phoenix summary budget. Phoenix, AZ: City of Phoenix Budget and Research Department.
52.
Pierce, N. R. , C. Johnson, and J. H. Hall. 1993. Citistates: How urban America can prosper in a competitive world. Washington, DC: Seven Locks Press.
53.
Popenoe, D.1979. Urban sprawl: Some neglected sociological considerations. Sociology and Social Research63:255-268.
54.
Rayner, A. G. , and J. Lingard. 1971. Fertilizer prices and quality change: Construction of fertilizer prices and quantity indices for Great Britain. Journal of Agricultural Economics22:149-162.
55.
Rosen, S.1974. Hedonic prices and implicit markets: Product differentiation in pure competition. Journal of Political Economy82:34-55.
56.
Rusk, D.1995. Cities without suburbs. Washington, DC: Woodrow Wilson Center.
57.
Savitch, H. V. , D. Collins, D. Sanders, and J. P. Markham. 1993. Ties that bind: Central cities, suburbs, and the new metropolitan region. Economic Development Quarterly7:341-358.
58.
Sullivan, A.1985. The pricing of urban services and the spatial distribution of residence. Land Economics61:17-25.
Swanstrom, T.1996. Ideas matter: Reflections on the new regionalism. Cityscape: A Journal of Policy Development and Research2:5-21.
61.
Tiebout, C. M.1965. Pure theory of local expenditures. Journal of Political Economy64:416-424.
62.
Triplett, J. E.1969. Automobiles and hedonic quality measurement. Journal of Political Economy77:408-417.
63.
Triplett, J. E.1989. Price and technological change in a capital good: A survey of research on computers. In Technology and capital formation, edited by D. L. Jorgenson and R. Landau. Cambridge: MIT Press.
64.
U.S. Bureau of the Census . 1990. U.S. census of population and housing. Washington, DC: Government Printing Office.
65.
Vest, M. J.1995. Phoenix-Mesa metro economy is slowing, but outlook still bright. In Arizona's economy, 1-6. Tucson, AZ: College of Business and Public Administration.
66.
Voith, R.1992. City and suburban growth: Substitutes or complements? In Business review (September/October). Philadelphia: Federal Reserve Bank of Philadelphia.
67.
Voith, R.1996. The suburban housing market: The effects of city and suburban job growth. In Business review (November/December). Philadelphia: Federal Reserve Bank of Philadelphia.
68.
Weatherby, J. B. , and L. Witt. 1994. The urban west: Managing growth and decline. Westport, CT: Praeger.
69.
Wichert, M. L. 1996 Who pays for growth? An analysis of housing in the city of Phoenix. Master's thesis, School of Planning and Landscape Architecture, University of Arizona, Tempe.
70.
Yinger, J. , H. S. Bloom, A. Borsch-Supan, and H. F. Ladd. 1988. Property taxes and house values: The theory and estimation of intrajurisdictional property tax capitalization. Boston: Academic Press.
