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Empirical Evidence on the Impact of City Taxes

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  • Charles Swenson

Abstract

An important issue is whether cities can influence their own economic growths through municipal-level tax policy. There is little evidence on this to date, nor is there a clear a priori answer to this question. This study first documents municipal business tax rates across the United States, and finds they are a relatively significant cost to business. Next, using very a unique and precise government data set, the study examines the economic impacts of two previous tax cuts in Los Angeles and finds that these cuts generally resulted in growth in both the number of jobs and establishments.

Suggested Citation

  • Charles Swenson, 2017. "Empirical Evidence on the Impact of City Taxes," Applied Economics and Finance, Redfame publishing, vol. 4(2), pages 65-75, March.
    • Handle: RePEc:rfa:aefjnl:v:4:y:2017:i:2:p:65-75
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    References listed on IDEAS

    as
    1. Timothy J. Bartik, 1992. "The Effects of State and Local Taxes on Economic Development: A Review of Recent Research," Economic Development Quarterly, , vol. 6(1), pages 102-111, February.
    2. Yonghong Wu, 2010. "Property Tax Exportation and Its Effects on Local Business Establishments: The Case of Massachusetts Municipalities," Economic Development Quarterly, , vol. 24(1), pages 3-12, February.
    3. Ham, John C. & Swenson, Charles & İmrohoroğlu, Ayşe & Song, Heonjae, 2011. "Government programs can improve local labor markets: Evidence from State Enterprise Zones, Federal Empowerment Zones and Federal Enterprise Community," Journal of Public Economics, Elsevier, vol. 95(7), pages 779-797.
    4. Robert W. Wassmer & John E. Anderson, 2001. "Bidding for Business: New Evidence on the Effect of Locally Offered Economic Development Incentives in a Metropolitan Area," Economic Development Quarterly, , vol. 15(2), pages 132-148, May.
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    More about this item

    Keywords

    city taxes; tax policy; economic development;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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