We show that capitalization of local education into the housing price induces childless voters to support local education. In particular, low income childless households vote for a tax raise when capitalization is strong, whereas high income childless supports a higher tax when capitalization is weak. The median income voter is never pivotal because "ends with the middle" coalitions arise: high income households (with and without a child) makes coalition with middle income class with a child, whereas low income households (with and without a child) make coalition with childless middle income class. We .nd that the income of the childless median voter is higher than the median income, whereas median voter with a child has income lower than the median. Thus the equilibrium tax preferred by the median voter (childless or not), is higher than the tax preferred by the childless median income voter and lower than the tax preferred by the median income voter with a child. This result implies that it is not possible to exclude voting equilibria in which the tax of the childless median voter is higher than the tax of the median voter with a child.
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Paper provided by THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise in its series THEMA Working Papers with number
2009-07.
Find related papers by JEL classification: H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures I22 - Health, Education, and Welfare - - Education - - - Educational Finance R2 - Urban, Rural, and Regional Economics - - Household Analysis
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