Local fiscal variables and intrametropolitan firm location: regression evidence from the United States and research suggestions
A survey is given of US studies relating to the influence of local fiscal variables on intrametropolitan firm location. The survey is important for two reasons. First, it documents the reversal in early empirical results that local fiscal variables do not influence intrametropolitan firm location to the current empirical consensus that local fiscal variables do exert some statistically significant influence. Second, the survey is used to formulate suggestions on how research on this topic, no matter where it is done for, should proceed. A recent study is described that shows that property tax abatements to firms mitigate the influence that local fiscal variables have on intrametropolitan firm location. A tabular summary of the varying property tax and local expenditure elasticities of various measures of firm location is also given.
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