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Impact of Local Public Services and Taxes on Dwelling Choice within a Single Taxing Jurisdiction: A Discrete Choice Model

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  • Bulent Uyar

    (Economics Department College of Business Administration University of Northern Iowa Cedar Falls, IA 50614-0129)

  • Kenneth H. Brown

    (Economics Department College of Business Administration University of Northern Iowa Cedar Falls, IA 50614-0129)

Abstract

Discrete choice models of household location assume local public finance variables remain the same within a given taxing jurisdiction. Thus far, no such model has tested the validity of this assumption. This study employs McFadden’s (1978, 2001) discrete choice model to test for the significance of dwelling specific local taxes and public services on household location decisions within a single taxing jurisdiction. The findings indicate that such variables are significant determinants of location decisions even within a single taxing jurisdiction, and should not be assumed away. Failure to include such variables in a model may, therefore, result in biased statistical results.

Suggested Citation

  • Bulent Uyar & Kenneth H. Brown, 2005. "Impact of Local Public Services and Taxes on Dwelling Choice within a Single Taxing Jurisdiction: A Discrete Choice Model," Journal of Real Estate Research, American Real Estate Society, vol. 27(4), pages 427-444.
    • Handle: RePEc:jre:issued:v:27:n:3:2005:p:427-444
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    References listed on IDEAS

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    3. Sener, Ipek N. & Pendyala, Ram M. & Bhat, Chandra R., 2011. "Accommodating spatial correlation across choice alternatives in discrete choice models: an application to modeling residential location choice behavior," Journal of Transport Geography, Elsevier, vol. 19(2), pages 294-303.

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    JEL classification:

    • L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services

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