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Time persistence and spatial spillovers in local government expenditures

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  • Joanne Doyle
  • Ben Hamilton

Abstract

We provide empirical evidence concerning dynamic persistence and spillovers in public expenditures with a focus on local governments. Using a unique panel dataset consisting of the counties and independent cities of Virginia, we find both time persistence and neighbour spillovers present in the data, but we find that time persistence is much stronger and reduces the strength of spatial spillovers by an average of 40% for different spending categories. We find that a spillover model is not well suited to local government expenditures due to mandatory spending. Time persistence captures the slow pace of many government activities.

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  • Joanne Doyle & Ben Hamilton, 2024. "Time persistence and spatial spillovers in local government expenditures," Applied Economics, Taylor & Francis Journals, vol. 56(39), pages 4649-4663, August.
    • Handle: RePEc:taf:applec:v:56:y:2024:i:39:p:4649-4663
    DOI: 10.1080/00036846.2023.2212973
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