Previous research has examined the effect of property tax levels and related Abstract public expenditures on property values. However, a more comprehensive
proposition, implied by the property rights literature and market efficiency,
suggests interjurisdictional differences in taxes of all forms, not just property
taxes, will be capitalized in property values. Furthermore, cross-sectional
property values are expected to vary systematically with differentials in welfare
program expenditures and with differentials in the extent to which tax burdens
are shifted to nonresidents. Empirical results are consistent with these
expectations and also provide insight into the relationship between political
competition and property values and between local fiscal choices and regional
growth patterns.
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