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Tiebout Dynamics: Neighborhood Response To A Central‐City/Suburban House‐Price Differential

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  • Paul Thorsnes
  • John W. Reifel

Abstract

ABSTRACT We take advantage of an unusual natural experiment—a high‐quality 1920s subdivision split neatly in half by a central‐city/suburban boundary—to study the response over 30 years to the relative decline in the quality of central‐city services since the 1960s. As expected, a large sale price differential opens in the 1960s. Demographic characteristics are nevertheless similar across the boundary. Survey data indicate Tiebout sorting: the central city side attracts households who prefer alternatives to suburban public schools. Children attend parochial and public “magnet” schools. A neighborhood association supplements municipal services. Rigid service district boundaries inhibit closure of the house‐price differential.

Suggested Citation

  • Paul Thorsnes & John W. Reifel, 2007. "Tiebout Dynamics: Neighborhood Response To A Central‐City/Suburban House‐Price Differential," Journal of Regional Science, Wiley Blackwell, vol. 47(4), pages 693-719, October.
    • Handle: RePEc:bla:jregsc:v:47:y:2007:i:4:p:693-719
    DOI: 10.1111/j.1467-9787.2007.00526.x
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    References listed on IDEAS

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    1. Thomas J. Kane & Douglas O. Staiger & Stephanie K. Riegg, 2005. "School Quality, Neighborhoods and Housing Prices: The Impacts of school Desegregation," NBER Working Papers 11347, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Marc K. Francke & Alex Minne, 2017. "The Hierarchical Repeat Sales Model for Granular Commercial Real Estate and Residential Price Indices," The Journal of Real Estate Finance and Economics, Springer, vol. 55(4), pages 511-532, November.
    2. Mick Silver, 2016. "How to Better Measure Hedonic Residential Property Price Indexes," IMF Working Papers 2016/213, International Monetary Fund.
    3. Lee Hachadoorian, 2016. "Homogeneity tests of Tiebout sorting: A case study at the interface of city and suburb," Urban Studies, Urban Studies Journal Limited, vol. 53(5), pages 1000-1021, April.
    4. Daniel P. McMillen, 2010. "Issues In Spatial Data Analysis," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 119-141, February.
    5. Sylvia Y He, 2017. "A hierarchical estimation of school quality capitalisation in house prices in Orange County, California," Urban Studies, Urban Studies Journal Limited, vol. 54(14), pages 3337-3359, November.
    6. Marc Francke, 2010. "Repeat Sales Index for Thin Markets," The Journal of Real Estate Finance and Economics, Springer, vol. 41(1), pages 24-52, July.

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