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Tiebout Hypothesis and Migration-Impact of Local Fiscal Policies

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  • Islam, Mohammed N

Abstract

A model of individual migration behavior, incorporating local government fiscal structure, is developed and estimated using 1981 Canadian census data. Estimated tax differentials and selectivity-bias corrected welfare (and income) gains are incorporated in the equation. The results provide further evidence in support of the Tiebout hypothesis. Considering only two policy variables (tax and welfare differential), the author finds that people prefer low-taxed and high welfare-spending areas, with marginal propensity to migrate varying with age. When additional migration factors are considered, people are more attracted in their locational choice by higher welfare benefits than lower property taxes.

Suggested Citation

  • Islam, Mohammed N, 1989. "Tiebout Hypothesis and Migration-Impact of Local Fiscal Policies," Public Finance = Finances publiques, , vol. 44(3), pages 406-418.
    • Handle: RePEc:pfi:pubfin:v:44:y:1989:i:3:p:406-18
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    Cited by:

    1. Mulholland, Sean E. & Hernandez-Julian, Reynaldo, 2021. "Does Economic Freedom Lead to Selective Migration by Sex and Race?," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 53(1), July.
    2. Keith Dowding & Peter John & Stephen Biggs, 1994. "Tiebout : A Survey of the Empirical Literature," Urban Studies, Urban Studies Journal Limited, vol. 31(4-5), pages 767-797, May.
    3. Katsuyoshi Nakazawa & Shumpei Yaoita & Akira Yokoyama, 2016. "Services for Child Care Support as Social Infrastructure: Impact on Birthrate and Migration of Children and Review of Best Practices," Public Policy Review, Policy Research Institute, Ministry of Finance Japan, vol. 12(1), pages 1-22, March.
    4. Mulholland, Sean E. & Hernandez-Julian, Rey, 2013. "Does Economic Freedom Lead to Selective Migration By Education?," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 43(1).
    5. Nakazawa, Katsuyoshi & 中澤, 克佳 & ナカザワ, カツヨシ & Kawase, Akihiro & 川瀬, 晃弘 & カワセ, アキヒロ, 2009. "An Empirical Analysis of the Welfare Magnet: Aged Care Provision and Migration in Japan," PIE/CIS Discussion Paper 412, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.

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