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Local Residential Sorting and Public Goods Provision: A Classroom Demonstration

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Author Info
Keith Brouhle (University of Alberta)
Jay Corrigan () (Kenyon College)
Rachel Croson (University of Pennsylvania)
Martin Farnham (University of Victoria)
Luba Habodaszova (City University)
Laurie Tipton Johnson (University of Denver)
Martin Johnson (University of California, Riverside)
Selhan Garip (Virginia Tech)
David Reiley (University of Arizona)

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Abstract

This classroom exercise illustrates the Tiebout (1956) hypothesis that residential sorting across multiple jurisdictions leads to a more efficient allocation of local public goods. The exercise places students with heterogeneous preferences over a public good into a single classroom community. A simple voting mechanism determines the level of public good provision in the community. Next, the classroom is divided in two, and students may choose to move between the two smaller communities, sorting themselves according to their preferences for public goods. The exercise places cost on movement at first, then allows for costless sorting. Students have the opportunity to observe how social welfare rises through successive rounds of the exercise, as sorting becomes more complete. They may also observe how immobile individuals can become worse off because of incomplete sorting when the Tiebout assumptions do not hold perfectly.

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Publisher Info
Article provided by Helen Dwight Reid Foundation in its journal The Journal of Economic Education.

Volume (Year): 36 (2005)
Issue (Month): 4 ()
Pages: 332-344
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Handle: RePEc:jee:journl:v:36:y:2005:i:4:p:332-344

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Related research
Keywords: classroom experiments; public goods; residential sorting; Tiebout hypothesis;

Other versions of this item:

Find related papers by JEL classification:
A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416. [Downloadable!] (restricted)
  2. Mieszkowski, Peter & Zodrow, George R, 1989. "Taxation and the Tiebout Model: The Differential Effects of Head Taxes, Taxes on Land Rents, and Property Taxes," Journal of Economic Literature, American Economic Association, vol. 27(3), pages 1098-1146, September. [Downloadable!] (restricted)
  3. Rubinfeld, Daniel L & Shapiro, Perry & Roberts, Judith, 1987. "Tiebout Bias and the Demand for Local Public Schooling," The Review of Economics and Statistics, MIT Press, vol. 69(3), pages 426-37, August. [Downloadable!] (restricted)
  4. Kollman, Ken & Miller, John H & Page, Scott E, 1997. "Political Institutions and Sorting in a Tiebout Model," American Economic Review, American Economic Association, vol. 87(5), pages 977-92, December. [Downloadable!] (restricted)
  5. Donahue, John D, 1997. "Tiebout? Or Not Tiebout? The Market Metaphor and America's Devolution Debate," Journal of Economic Perspectives, American Economic Association, vol. 11(4), pages 73-81, Fall. [Downloadable!] (restricted)
  6. Groves, Theodore, 1973. "Incentives in Teams," Econometrica, Econometric Society, vol. 41(4), pages 617-31, July. [Downloadable!] (restricted)
  7. Brueckner, Jan K., 2000. "A Tiebout/tax-competition model," Journal of Public Economics, Elsevier, vol. 77(2), pages 285-306, August. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Pablo BraƱas-Garza & Javier Rodero-Cosano, 2004. "Neighbourhood attributes and housing prices: An empirical investigation," IESA Working Papers Series 0414, Institute for Social Syudies of Andalusia - Higher Council for Scientific Research. [Downloadable!]
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This page was last updated on 2009-11-25.


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