How does municipal policy affect state and local actions? Evidence from land conservation spending

Understanding responses to government action is critical for developing efficient policy. In the context of land conservation, this paper examines whether municipal policy has a crowding-in or crowding-out effect on neighboring municipalities’ actions and state government actions. Importantly, we focus on municipal conservation referendums, which allow us to use a regression discontinuity framework for causal inference. Using data from Massachusetts and New Jersey, our findings suggest municipal conservation decisions have no effect on neighboring local governments’ or the state’s conservation activity.