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Municipal residency laws and local public budgets

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  • Stephen Mehay
  • Kenneth Seiden

Abstract

Prior research has shown that residency laws increase the productivity of municipal employees, which tends to reduce per unit operating cost. However, this gain in efficiency appears to have been lost when one considers that public employee groups tend to be ‘high demanders’ who have a greater tendency to vote in local elections and to support expenditure increases (Bennett and Orzechowski, 1983). Our results tend to provide additional evidence to support the findings of previous studies that public employee groups tend to exert a disproportionate impact on local budgetary decisions. It is also noteworthy that Hirsch and Rufolo (forthcoming) report that cities with police residency laws are characterized by lower police wages than cities without the laws. Thus, insofar as such laws do reduce per unit cost, the main benefit appears to accrue to the local bureaucracy in the form of greater output, expenditures, and agency size, not to employees in the form of higher wages, or to city residents in the form of tax relief. Because these laws also impose restrictions on employee mobility and residential choice, their overall effect may be to generate social costs in excess of their social benefits. Copyright Martinus Nijhoff Publishers 1986

Suggested Citation

  • Stephen Mehay & Kenneth Seiden, 1986. "Municipal residency laws and local public budgets," Public Choice, Springer, vol. 48(1), pages 27-35, January.
    • Handle: RePEc:kap:pubcho:v:48:y:1986:i:1:p:27-35
    DOI: 10.1007/BF00239557
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    References listed on IDEAS

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    Cited by:

    1. Mark Partridge & Tim Sass, 2011. "The productivity of elected and appointed officials: the case of school superintendents," Public Choice, Springer, vol. 149(1), pages 133-149, October.
    2. Brian Duncan, 2005. "Using Municipal Residency Requirements to Disguise Public Policy," Public Finance Review, , vol. 33(1), pages 84-116, January.
    3. Lynn MacDonald, 2008. "The impact of government structure on local public expenditures," Public Choice, Springer, vol. 136(3), pages 457-473, September.
    4. Kevin M. O'Brien, 1997. "Do Municipal Residency Laws Affect Labour Market Outcomes?," Urban Studies, Urban Studies Journal Limited, vol. 34(11), pages 1759-1769, November.
    5. Alain Mingat & Pierre Salmon, 1988. "Alterable electorates in the context of residential mobility," Public Choice, Springer, vol. 59(1), pages 67-82, October.

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