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Competition and property tax limit overrides: Revisiting Massachusetts' Proposition 2½

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  • Hawley, Zackary
  • Rork, Jonathan C.

Abstract

This paper looks at the role of spatial proximity of other towns' decisions to hold an override vote on the decision of a Massachusetts town to hold an initial override vote under Proposition 2½. We find that if a neighboring town has already held a vote at some point in the past, a town's likelihood of holding an initial vote increases by 10–15%. A prior vote being successful has a strong impact, whereas losing votes are relatively ignored. The presence of spatial dependence remains when we look at the specific purpose of override vote, or at the annual number of votes that have occurred between 1982 and 2010. This result is consistent across weighting schemes.

Suggested Citation

  • Hawley, Zackary & Rork, Jonathan C., 2015. "Competition and property tax limit overrides: Revisiting Massachusetts' Proposition 2½," Regional Science and Urban Economics, Elsevier, vol. 52(C), pages 93-107.
    • Handle: RePEc:eee:regeco:v:52:y:2015:i:c:p:93-107
    DOI: 10.1016/j.regsciurbeco.2015.02.006
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    More about this item

    Keywords

    Proposition 2½; Spatial dependence; Property tax;
    All these keywords.

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • R50 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - General
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies

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