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The Impact of the US Sales Tax Rate on City Size and Economic Activity: A CGE Approach

Author

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  • Harvey Cutler

    (Department of Economics, Colorado State University, Fort Collins, Colorado 80523, USA, hcutler@lamar.colostate.edu)

  • Irina Strelnikova

    (Department of Economics, Colorado State University, Fort Collins, Colorado 80523, USA, irina.Strelnikova@colostate.edu)

Abstract

This paper analyses the effects of the change in the US sales tax on economic activity and city size using a computable general equilibrium (CGE) model. Previous works have been designed to isolate the effects of a sales tax change on the particular parameters, such as city size, non-central retail activity and the value of housing. This research summarises the effects of a change in the sales tax rate on all the relevant variables in the context of one model. The underlined theoretical foundation is tested using data collected for the city of Fort Collins, a jurisdiction of approximately 100 000 people in northern Colorado, USA.

Suggested Citation

  • Harvey Cutler & Irina Strelnikova, 2004. "The Impact of the US Sales Tax Rate on City Size and Economic Activity: A CGE Approach," Urban Studies, Urban Studies Journal Limited, vol. 41(4), pages 875-885, April.
    • Handle: RePEc:sae:urbstu:v:41:y:2004:i:4:p:875-885
    DOI: 10.1080/0042098042000194151
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    References listed on IDEAS

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    Cited by:

    1. Perry Burnett & Harvey Cutler & Stephen Davies, 2012. "Understanding The Unique Impacts Of Economic Growth Variables," Journal of Regional Science, Wiley Blackwell, vol. 52(3), pages 451-468, August.
    2. Fumitoshi Mizutani & Noriyoshi Nakayama & Tomoyasu Tanaka, 2015. "An Analysis of the Effects of the Compact City on Economic Activities in Japan," ERSA conference papers ersa15p160, European Regional Science Association.
    3. Adam T. Jones, 2016. "Mileage tax, property tax, sales tax, or fee: the best way to pay for commercial infrastructure that isn’t free," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 36(1), pages 81-98, February.
    4. Katherine Chalmers & Stephan Weiler, 2011. "Sorting winners and losers: using CGE models to assess income distribution effects of economic development choices," Regional Science Policy & Practice, Wiley Blackwell, vol. 3(1), pages 1-15, March.
    5. Mark Partridge & Dan Rickman, 2010. "Computable General Equilibrium (CGE) Modelling for Regional Economic Development Analysis," Regional Studies, Taylor & Francis Journals, vol. 44(10), pages 1311-1328.
    6. Jeffrey Condon & Andrew Feltenstein & Florenz Plassman & Mark Rider & David L. Sjoquist, 2014. "A Regional Model of Growth Oriented Fiscal Policy: An Application to Georgia and Its Competitor States," The Review of Regional Studies, Southern Regional Science Association, vol. 44(2), pages 177-209, Summer.

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