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Income Tax Adoption and Spatial Diffusion

Author

Listed:
  • Joshua Hall

    (West Virginia University)

  • Donald Lacombe

    (Texas Tech University)

  • Maria Tackett

    (Gonzaga University)

Abstract

In recent years, a number of papers have looked at the adoption and diffusion of taxes across national, state, and local governments. Spending pressures, reductions in tax collection costs, median voter preferences, and social learning have been found to play an important role in the adoption of the income tax. Spatial econometrics were used to study the diffusions of income taxes across states from 1900 to 2010. Using United States Census Bureau data, negative spatial autocorrelation in income tax adoption was found. This is consistent with Tiebout competition reducing the likelihood of income tax adoption. States whose neighbors adopted income taxes were less likely to do so. This work informs the literature on policy diffusion as well as the understanding of why only some states utilize the income tax.

Suggested Citation

  • Joshua Hall & Donald Lacombe & Maria Tackett, 2020. "Income Tax Adoption and Spatial Diffusion," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 48(2), pages 185-193, June.
    • Handle: RePEc:kap:atlecj:v:48:y:2020:i:2:d:10.1007_s11293-020-09669-z
    DOI: 10.1007/s11293-020-09669-z
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    References listed on IDEAS

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    Cited by:

    1. Calkins, Lindsay N. & Ryan, Alexander J. & Zlatoper, Thomas J., 2023. "The Political Economy of Recreational Marijuana Laws in the U.S.: A Spatial Approach," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 53(01), April.
    2. Dorian Balvir, 2024. "Fiscal rules: the imitation game," Applied Economics, Taylor & Francis Journals, vol. 56(6), pages 708-727, February.
    3. Richard J. Cebula, 2020. "Financial Economics Meets Tax Policy," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 48(2), pages 143-146, June.

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