In this paper we investigate the demand for local public school expenditures in Sweden. By using survey data, a method previously never applied to Swedish data, the paper provides an additional piece of evidence on individual demand for publicly provided local services. Estimating a linear demand specification, we find that the demand is inelastic with respect to income and tax, much in line with previous Swedish findings in a median voter framework. Estimation of a log-linear demand specification indicates more elastic demand. Testing the hypothesis that municipal employees tend to have a higher demand for public spending than others, we conclude that income, as well as taxprice, enters the demand function differently for the two groups of employees. We find no evidence of Tiebout sorting.
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Paper provided by Uppsala University, Department of Economics in its series Working Paper Series with number
2000:12.
Length: 33 pages Date of creation: 17 Aug 2000 Date of revision: Publication status: Published in International Tax and Public Finance, 2001, pages 331-351. Handle: RePEc:hhs:uunewp:2000_012
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Find related papers by JEL classification: C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models H40 - Public Economics - - Publicly Provided Goods - - - General H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
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