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Government, Effectiveness, Performance and Local Property Values

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  • Deller, Steven

    (U of Wisconsin)

  • Maher, Craig

    (U of Wisconsin, Oshkosh)

Abstract

We offer a practical test of local government effectiveness in the provision of public services. Building on the work of Brueckner (1979, 1982, 1983) and Henderson (1990, 1995) we offer a property value maximization model where levels of local public services are capitalized into property values. Using data for Wisconsin municipalities we demonstrate that service expenditure levels, and corresponding taxation levels, should be increased. In other words, the property value maximization test suggests that local public services in Wisconsin are consistently under-provided. By monitoring local property values officials can objectively determine if public services are being provided in an optimal manner.

Suggested Citation

  • Deller, Steven & Maher, Craig, 2005. "Government, Effectiveness, Performance and Local Property Values," Staff Paper Series 482, University of Wisconsin, Agricultural and Applied Economics.
  • Handle: RePEc:ecl:wisagr:482
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    References listed on IDEAS

    as
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