Fiscal Fragmentation and the Distribution of Metropolitan Area Resources: A Case Study

Abstract

This paper estimates the incidence of local taxes and expenditures and the distribution of income in metropolitan Washington, DC, under our current fragmented system of governing metropolitan areas and under a hypothetical metropolitan-wide regime. The purpose of this exercise is to consider how the distribution of metropolitan resources might differ had society evolved toward a unified form of metropolitan governance . It is found that tax and expenditure incidence and the distribution of income are strikingly similar under both systems . From an equity perspective, neither the current fragmented system nor a unified system emerges as a clearly superior form of metropolitan organisation.

Poverty and Urban Public Expenditures

“…The exportabil ity for each of these is then com puted, on *indicates signi® cant at better than 0.01; ** at 0.05; *** at 0.10. the basis of a set of reasonab le but im perfect assum ptions, so that the actual construc ted variable, Revenue raising capacity (not actual revenue raised) 5 0.03 Y (1 1 e), ª ¼ where Y is per capita incom e of resident s and e is the tax burden on nonresid ents per dollar of burden on resident sº (p. 47). (T hese assum ptions may be com pared to the very differen t assum ptions, about tax incidence, made by Sacher (1994). T hese w ould undoubted ly yield still differen t outcom es.)…”

Economic Inequality and Public Policy: The Power of Place

“…Moreover, these expenditures typically do not achieve the same results in public security or educational achievement as their suburban counterparts. To add insult to injury, these citizens are forced to pay more of their income in taxes (Sacher, 1993).…”

Deprivation and Incidence of Urban Public Services: A Tale of Three Cities

“…Using sample survey and opinion polls, there exist a few studies, such as Paul (1994), who made a comparative study of slum dwellers in three major cities in India, namely Pune, Bangalore and Ahmadabad, and showed that such persons in these cities have very poor access to infrastructure and civic services in their localities. On a more organized basis, conventional expenditure incidence studies have generally concentrated on the expenditure of higher levels of government, namely state and central governments to distribute expenditure benefits to different income groups and then relate these benefits to income of respective groups to say whether benefits are progressive or regressive (Hausmann and Rigobon, 1993;Musgrave and Musgrave, 1989;Wulf, 1975, 1981, and Sacher, 1993 for review of the theory, conceptual problems and empirical studies). However, these estimates at best present some pattern of benefits across income groups, as there is no reference to any norm or ideal point and minimum need.…”