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Interrelationships among public spending preferences: A micro analysis

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  • James Ferris

Abstract

This paper examines a system of qualitative demand equations for public spending on education, welfare, housing, health, highways, and defense. The demand for public spending for a particular category is hypothesized to be a function of income, tax-price, private benefit measures, and tastes as well as demands for other public expenditure categories. Based on individual survey data, the conditional maximum likelihood estimates of the logit equations are obtained. The results indicate the significant role of tastes, private benefit variables, and tax-prices. In addition, positive rather than negative, demand interrelationships are found to exist. These findings question the validity of the median voter hypothesis as a model for public budget allocation. Copyright Martinus Nijhoff Publishers 1985

Suggested Citation

  • James Ferris, 1985. "Interrelationships among public spending preferences: A micro analysis," Public Choice, Springer, vol. 45(2), pages 139-153, January.
  • Handle: RePEc:kap:pubcho:v:45:y:1985:i:2:p:139-153
    DOI: 10.1007/BF00215061
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    References listed on IDEAS

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    1. Schmidt, Peter & Strauss, Robert P, 1975. "Estimation of Models with Jointly Dependent Qualitative Variables: A Simultaneous Logit Approach," Econometrica, Econometric Society, vol. 43(4), pages 745-755, July.
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    4. Deacon, Robert T, 1978. "A Demand Model for the Local Public Sector," The Review of Economics and Statistics, MIT Press, vol. 60(2), pages 184-192, May.
    5. Guilkey, David K. & Schmidt, Peter, 1979. "Some small sample properties of estimators and test statistics in the multivariate logit model," Journal of Econometrics, Elsevier, vol. 10(1), pages 33-42, April.
    6. Strauss, Robert P. & Hughes, G. David, 1976. "A new approach to the demand for public goods," Journal of Public Economics, Elsevier, vol. 6(3), pages 191-204, October.
    7. Borcherding, Thomas E & Deacon, Robert T, 1972. "The Demand for the Services of Non-Federal Governments," American Economic Review, American Economic Association, vol. 62(5), pages 891-901, December.
    8. Romer, Thomas & Rosenthal, Howard, 1979. "The elusive median voter," Journal of Public Economics, Elsevier, vol. 12(2), pages 143-170, October.
    9. Rubinfeld, Daniel L, 1977. "Voting in a Local School Election: A Micro Analysis," The Review of Economics and Statistics, MIT Press, vol. 59(1), pages 30-42, February.
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    Cited by:

    1. Yamamura, Eiji, 2014. "Time preference and perceptions about government spending and tax: Smokers’ dependence on government support," MPRA Paper 55659, University Library of Munich, Germany.
    2. Elnagheeb, Abdelmoneim H. & Jordan, Jeffrey L. & Humphrey, Vonda, 1995. "The Structure Of Farmers' Perceptions Of Ground Water Pollution," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 27(1), pages 1-14, July.
    3. Mahoney, Michelle S. & Kemp, Simon & Webley, Paul, 2005. "Factors in lay preferences for government or private supply of services," Journal of Economic Psychology, Elsevier, vol. 26(1), pages 73-87, February.

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