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Using survey data to study capitalization of local public services

Author

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  • Fredrik Carlsen

    (Department of Economics, Norwegian University of Science and Technology)

  • Jørn Rattsø

    (Department of Economics, Norwegian University of Science and Technology)

  • Bjørg Langset

    (Research Department, Statistics Norway)

  • Lasse Stambøl

    (Research Department, Statistics Norway)

Abstract

We use surveys in which respondents evaluate local amenities in Norway to compute proxy variables for the quality of local public services as well as other local amenities relevant to location decisions. Average satisfaction reported by the respondents is computed for each amenity and each municipality, adjusted for sample variation in personal characteristics and included as explanatory variables in a cross-section study of house prices. We find that house prices are increasing in satisfaction with health care, cultural activities and public transportation, suggesting that the quality of local public services indeed affects the attractiveness of a residential site. When the analysis is repeated with input measures of service levels instead of satisfaction variables, we find no effects of local public services on house prices, indicating that traditional Tiebout studies based on input measures may have underestimated the importance of local public services for location decisions.

Suggested Citation

  • Fredrik Carlsen & Jørn Rattsø & Bjørg Langset & Lasse Stambøl, 2006. "Using survey data to study capitalization of local public services," Working Paper Series 8106, Department of Economics, Norwegian University of Science and Technology.
    • Handle: RePEc:nst:samfok:8106
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    Cited by:

    1. Fredrik Carlsen & Kåre Johansen & Lasse Sigbjørn Stambøl, 2013. "Effects of Regional Labour Markets on Migration Flows, by Education Level," LABOUR, CEIS, vol. 27(1), pages 80-92, March.
    2. Lei Niu & Lulu Yuan & Zhongmin Ding & Yifu Zhao, 2023. "How Do Support Pressure and Urban Housing Purchase Affect the Homecoming Decisions of Rural Migrant Workers? Evidence from Rural China," Agriculture, MDPI, vol. 13(8), pages 1-28, July.
    3. Lars-Erik Borge & Jørn Rattsø, 2017. "Local Economic Consequences of Investment in Children: Capitalization of Child Care Services," CESifo Working Paper Series 6809, CESifo.
    4. Fredrik Carlsen & Stefan Leknes, 2019. "The paradox of the unhappy, growing city: reconciling evidence," Discussion Papers 907, Statistics Norway, Research Department.
    5. Hildegunn Stokke & Jørn Rattsø & Fredrik Carlsen, 2012. "Urban wage premium increasing with education level: Identification of agglomeration effects for Norway," ERSA conference papers ersa12p459, European Regional Science Association.

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    More about this item

    Keywords

    Capitalization; Local public services; Survey data;
    All these keywords.

    JEL classification:

    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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