Fiscal Externalities and Residential Growth Controls: a Theory-of-Clubs Perspective

Abstract

This article develops a model that extends the theory of clubs to the case in which a local congestible public good requires a capital facility for its pro vision in a community facing population growth. The trade-offs facing officials planning the capital facility are examined. The model offers an explanation as to why formerly progrowth communities may now vigorously oppose growth. Many communities imposing growth controls cite inadequate public facilities. An implication of the model is that this inadequacy may be planned. The article exammes other implications of the model and gives some indication of its explanatory and predictive powers.