Municipal Income Research Articles

Does the Local Government Structure Affect Population and Income Growth? An Empirical Analysis of the 1952 Municipal Reform in Sweden

Hanes N. and Wikström M. Does the local government structure affect population and income growth? An empirical analysis of the 1952 municipal reform in Sweden, Regional Studies. The main purpose of the paper is to analyse if the Swedish municipal reform in 1952 affected subsequent income growth and population movements. The empirical analysis is conducted using data for the period 1953 to 1959. The main result is that the municipal amalgamations had no effect on the municipal income growth patterns. However, a positive effect on population growth is found for the municipalities that were small in size prior to the reform. It is also found that the composition of the municipalities formed affected subsequent growth. Hanes N. et Wikström M. La structure de l'administration locale influence-t-elle la croissance de la population et des revenus?: une analyse empirique de la réforme municipale suédoise de 1952, Regional Studies. Cet article cherche principalement à analyser si, oui ou non, la réforme municipale suédoise de 1952 a influencé à terme la croissance des revenus et le déplacement de la population. L'analyse empirique se fait à partir des données pour la période allant de 1953 à 1959. Il en résulte principalement que les fusions municipales n'ont eu aucun effet sur la distribution municipale de la croissance des revenus. Cependant, il s'avère un effet positif sur la croissance de la population pour les municipalités qui avaient été de petite taille avant la réforme. Il s'avère aussi que la structure des municipalités ainsi créées a influencé la croissance future. Fusions municipales Assiette locale Croissance économique Croissance de la population Hanes N. und Wikström M. Wirkt sich die Gemeindestruktur auf das Bevölkerungs- und Einkommenswachstum aus? Eine empirische Analyse der Gemeindereform von 1952 in Schweden, Regional Studies. In diesem Beitrag wird untersucht, ob sich die schwedische Gemeindereform von 1952 auf das Einkommens- und Bevölkerungswachstum auswirkte. Die empirische Analyse wurde mit Hilfe von Daten aus dem Zeitraum von 1953 bis 1959 durchgeführt. Wichtigstes Ergebnis ist, dass sich die Verschmelzung der Gemeinden nicht auf das Muster des Einkommenswachstums in den Gemeinden auswirkte. Allerdings ließ sich ein positiver Effekt auf das Bevölkerungswachstum in den Gemeinden feststellen, die vor der Reform eine geringe Größe aufwiesen. Ebenso stellten wir fest, dass sich die Zusammensetzung der Gemeinden auf das spätere Wachstum auswirkte. Verschmelzung von Gemeinden Lokale Steuerbasis Wirtschaftswachstum Bevölkerungswachstum Hanes N. y Wikström M. Afecta la estructura del gobierno local a la población y al crecimiento de ingresos? Un análisis empírico de la reforma municipal de 1952 en Suecia, Regional Studies. La finalidad principal de este artículo es analizar si la reforma municipal en Suecia de 1952 afectó al posterior crecimiento de ingresos y a los movimientos de población. Los análisis empíricos se han llevado a cabo con ayuda de datos para el periodo de 1953 a 1959. El resultado principal es que las fusiones no influyeron en los modelos municipales de crecimiento de ingresos. Sin embargo, se observa un efecto positivo sobre el crecimiento de población en las municipalidades cuyos tamaños eran limitados antes de la reforma. También hemos observado que la composición de las municipalidades formadas afectó al posterior crecimiento. Fusiones municipales Base de impuesto local Crecimiento económico Crecimiento de población

Urban Growth in Nepal: Does Location Matter?

Between 1952 and 2001, the number of urban settlements in Nepal grew from 10 to 58, while their share in the country's population increased from 2.6 to 14.4 per cent. However, the spatial distribution of urban growth was uneven. To find out how this unevenness was structured, a GIS-assisted analysis matched spatial reference data (such as distances between individual municipalities and major rivers, roads, international borders and major population centres) against several socioeconomic performance indexes, such as annual population growth, per capita income and expenditures of local municipalities, telephone ownership, number of primary schools and number of industrial plants. The fastest-growing urban localities were found to be close to major population centres, to highways and to the Indian border. The rest exhibited poor socioeconomic performance.

Multi-scale analysis of agricultural development: A modelling approach for Ilocos Norte, Philippines

Decisions and policies that have implications on allocation of resources are made at different levels. Goals at different scales may be conflicting and decisions at one scale have consequences for those at other scales. Performing analyses at more than one scale is, therefore necessary in analysing future options for resource use. This paper illustrates the use of a multi-scale method enabling assessment of multi-purpose natural resource management options. Three examples of analyses that it allows are presented for Ilocos Norte province in the Philippines, at the farm household, municipal (Batac municipality) and provincial levels. Results show that: (1) Differences in resource endowments of farm households strongly affect the potential adoption rates of five well-defined alternative technologies. (2) Limited markets, inadequate infrastructure and resource endowments of farm households have large effects on resource use and goal achievement in the municipality. Not including these factors in a resource use analysis results in a so-called aggregation bias. As these are significant, ignoring them may result in misleading simulation results and policy conclusions. The aggregation bias resulting from assuming spatially fixed input and output prices is significant for Batac, which has poor farm-to-market roads. This suggests large potential benefits from improving infrastructure. The factors investigated suggest that aggregate income in the municipality is most strongly affected by the size of the market for some vegetables. (3) The differences in resource allocations resulting from prioritizing objectives at different levels reveal potential conflicts. The municipal income was highest with crops which pose more risk to farmers; our farm household analysis shows that farmers tend not to select too much of these crops. Similarly, the provincial income is highest when resources in the province are allocated such that more of the staple crop rice and less of the highly profitable cash crops are cultivated in Batac, resulting in lower income for the municipality. It is anticipated that the presented multi-scale approach will provide valuable information for joint-learning, policy discussions and decision-making regarding agricultural land use.

Evaluating the Environmental Performance of Urban Parks in Mediterranean Cities: An Example from the Barcelona Metropolitan Region

In a context of increasing urban sprawl and water scarcity common to other Mediterranean cities, this article focuses on the urban parks in the Region of Barcelona (Catalonia, Spain) to examine how these parks are distributed in this region and to assess whether their design and management follow criteria adapted to Mediterranean environmental conditions, especially in what concerns water use. In order to evaluate the environmental performance of these parks, we selected four factors possibly influencing the adoption of park management practices at the local scale: urban density, population size of the municipality, municipal income per capita, and political orientation of the city council. After determining the location and area of urban parks in the region, we correlated these four explanatory factors with several management tasks extracted from two different samples of parks (one of 315 parks and another of 125 parks) and a survey of 86 city councils. Results show that, in general, urban parks were more frequent in large, dense, and left/green municipalities but that environmentally sound practices were more common in small and low-density municipalities. We conclude that changes in certain practices (especially the substitution of high water demanding species) could improve significantly the environmental performance of public spaces in large urban areas with Mediterranean climates. Our observations may be pertinent for other cities interested in the provision of environmental public goods such as parks that necessitate water for irrigation.

Income convergence clubs for Brazilian Municipalities: a non-parametric analysis

This article analyses the evolution of relative per capita income distribution of Brazilian municipalities over the period 1970–1996. Analyses are based on non-parametric methodologies and do not assume probability distributions or functional forms for the data. Two convergence tests have been carried out – a test for sigma convergence based on the bootstrap principle and a beta convergence test using smoothing splines for the growth regressions. The results obtained demonstrate the need to model the dynamics of income for Brazilian municipalities as a process of convergence clubs, using the methodology of transition matrices and stochastic kernels. The results show the formation of two convergence clubs, a low income club formed by the municipalities of the North and Northeast regions, and another high income club formed by the municipalities of the Center-West, Southeast and South regions. The formation of convergence clubs is confirmed by a bootstrap test for multimodality.

Local Government Performance Indicators in Europe: an Exploration

Local governments need reliable information about the cities they are governing. However, an analysis of the availability of basic descriptive data (population data, information on household composition, unemployment, poverty, condition of the housing stock, homelessness, recorded crime and composition and size of local municipal income) in 55 European cities makes clear that these data are often not available because they have neither been collected nor disseminated. On average, 30 percent of simple local performance indicators is missing. National statistical traditions may help explaining the lack of data-gathering.

A Large Scale Study of Drinking Water Requirements in the Po Basin (Italy)

A newprocess that consists of showing the dependence of drinking water consumption on the economic, productive, and physical characteristics of municipalities was proposed. Statistical procedures were used in a survey of the territorial distribution of drinking water consumption in the Po Valley (Italy) carried out using the results of the 1987 National census and Ministry of Public Works investigations. The factor analysis proved to be particularly useful, allowing the expression of two components describing the water supply of the municipalities included in the survey, respectively defined as water availability and anthropic activity. The former is explained through variables such as precipitation, air temperature, and the geographical location of the municipality, according to specific climatic peculiarities. The latter is adequately represented by the type ofprevalent activity of the population (i.e., rural or urban), the level of urbanisation of the municipalities, and then the level of public services itprovides and the overall municipal income. The methodology described could prove useful in planning and managing the resources allocated for drinking purposes. Adjustment coefficients for the average per capita consumption of each demographic class are then calculated using suitable multiple regression models based on results of the factor analysis. An estimation of the water losses in the supply systems of some Italian towns is also presented.

Talking trash: the economic and environmental issues of landfills.

The U.S. per-capita figure for garbage production has topped four pounds per person per day, and that amount is rising at roughly 5% per year. In the past, municipal solid waste was sent to the nearest local landfill or incinerator. But in 1988, the U.S. Environmental Protection Agency instituted the first federal standards for landfills, designed to make them safer. Over 10,000 small municipal landfills have since been consolidated into an estimated 3,500 newer, safer landfills, some of which are "megafills" that can handle up to 10,000 tons of waste a day. The new landfills are outfitted to prevent air and water pollution and limit the spread of disease by scavengers. Although the new landfills provide better controls against air and water pollution as well as an alternate source of municipal income, they are not entirely problem-free. Some experts believe the new landfill technology has not been properly tested and will therefore not provide protection in the long run. Others feel that poorer, less well-informed communities are targeted as sites for new landfills. In addition, many people that live near megafills, which may draw garbarge from several states, are unhappy about the noise, truck traffic, odors, and pests caused by the facilities.

Talking Trash: The Economic and Environmental Issues of Landfills

The U.S. per-capita figure for garbage production has topped four pounds per person per day, and that amount is rising at roughly 5% per year. In the past, municipal solid waste was sent to the nearest local landfill or incinerator. But in 1988, the U.S. Environmental Protection Agency instituted the first federal standards for landfills, designed to make them safer. Over 10,000 small municipal landfills have since been consolidated into an estimated 3,500 newer, safer landfills, some of which are "megafills" that can handle up to 10,000 tons of waste a day. The new landfills are outfitted to prevent air and water pollution and limit the spread of disease by scavengers. Although the new landfills provide better controls against air and water pollution as well as an alternate source of municipal income, they are not entirely problem-free. Some experts believe the new landfill technology has not been properly tested and will therefore not provide protection in the long run. Others feel that poorer, less well-informed communities are targeted as sites for new landfills. In addition, many people that live near megafills, which may draw garbarge from several states, are unhappy about the noise, truck traffic, odors, and pests caused by the facilities.

Assessment of the financial resources of municipalities

The challenges with which municipalities are currently faced, include the fulfilment of the expectations of many new communities to whom they must render services, while they must simultaneously improve the quality of existing services and eliminate backlogs. The sources from which local authorities generate their revenue at present do not appear to be adequate for the increased need for funds. This paper provides an overview of the issues that have led to the current state of municipal finances and the factors that influence the revenue and expenditure of municipalities. In the light of the lack of sources of income for municipalities, particular attention is given to issues which could have an effect on the improvement of administration in municipalities.

Economic growth among a cross-section of municipalities

Our work builds on the analysis of municipal population and income growth over the 1960-90 period presented by Glaeser et al. [Journal of Monetary Economics, 36, 1, August, 1995, pp. 11743]. We examine a broader sample of 600 U.S. municipalities and investigate differences in the growth experiences of larger and smaller cities and of wealthier and poorer cities. The results confirm the robustness of the conclusions of Glaeser et al. that municipal population and income growth are: 1) positively correlated with the initial level of educational attainment in the municipality; 2) negatively correlated with the initial municipal unemployment rate; and 3) negatively correlated with the initial share of municipal employment in manufacturing. Additionally, we find some evidence of convergence across cities in levels of population and per capita income and we introduce municipal annexation activity as an additional institutional determinant of municipal growth. Our results suggest that annexation has been an important source of population and income growth for U.S. municipalities over the 1960-90 period. This finding adds another dimension to the literature on the determinants and consequences of municipal annexation activity and suggests that annexation activity should not be ignored in analyses of municipal economic development.

Social psychological variables in populations contrasted by income and suicide rate: Durkheim revisited.

The ten richest and ten poorest municipalities of Sweden were investigated with respect to national statistics to assess the relationship between suicide incidence, discrete social psychological variables associated with welfare admittance among the elderly, and income of municipality. The relative frequency of suicide was 1.6 times greater for Swedes from the low-income municipalities than for those from the high-income ones. The group of municipalities with the highest suicide rate had a significantly higher proportion of older people in need of municipal social assistance at their homes and also a significantly higher proportion of elderly living in municipality-managed 'service-homes.' The findings replicate earlier investigations and suggest social psychological indicators denoting less favourable economic and social resources are also associated with both an increased suicide rate and a decreased county or municipal income. Some theoretical issues of the socioeconomic and of the external restraint hypotheses of the incidence of suicide, contradicted by the present findings as well as of Durkheim's hypothesis of social control are discussed. Further, we suggest the consideration of negative socioeconomic conditions as a risk factor amid psychiatric clinical assessments of risk for suicidal behaviour.

Local Government School Priorities: Teaching Input and Class Size in Norway, 1980–1992

Increased local government autonomy can cause broader inequalities in the supply of education services. This paper analyzes the municipalities' priorities concerning basic education. The analysis is based on a model where the communes' resources are broken down into teaching input per class, class size and administrative outlays in the period 1980–1992. The model assumes that the commune's priorities regarding basic education are dependent on municipal economic constraints, the residential demands for basic education and other municipal services. The analysis reaches the following conclusions. (1) The resources input in basic schooling has increased markedly during the period 1980–1992. The total teaching input in work-years per class has increased from 1.5 to 2.0, and the mean class size has been reduced from 19 to 17 pupils. The disparities increased somewhat in the period 1980–1985, while they were stable in the period 1986–1992. The disparities were greatest in class size and least in teaching input per class. (2) The teaching input per student is quite insensitive to variations in local government revenues, and the resource level of basic schooling is less dependent on municipal income than are other municipal services. Revenue sensitivity is low in the short term, but greater with permanent changes in local revenue. (3) The level of basic schooling hardly competes with resource requirements in other municipal sectors. The resource input into basic schooling is slightly reduced where the proportion of the population exceeds 80 years of age or is under school age. (4) Those communes where the inhabitants have a high social status do not give priority to basic schooling at the expense of other municipal services. The resource input into basic schooling does not vary noticeably with the level of population, general education or income. (5) Little indicates that the transition from earmarked central government grants to a block grant system has resulted in a lower priority being accorded to basic schooling. The level of basic school resources has, however, become somewhat more sensitive to variations in municipal income base and demographic factors after the introduction of the new grant scheme.

STATE TAXATION OF INTEREST INCOME AND MUNICIPAL BORROWING COSTS

effect for small issues only (Kidwell, Koch, This study uses a sample of individual and Stock, 1984), another found no sigmunicipal bonds to estimate the effect of nifcant effect for large issues (Kidwell, state exemption of municipal bond interest Koch, and Stock, 1987), while a recent income on the yield to maturity offered by study found a significant effect for issues public issuers to finance their debt. The of any size (Brucato, Forbes, and Leonard, estimated average effect of a one percent- 1991). Moreover, none of the studies findage point reduction in the state income ing a link between state treatment and rate on in-state municipal bond interest is borrowing costs addresses the question of a 3.9 basis point reduction in the yield to whether the estimated interest savings are maturity. A state-by-state comparison of of sufficient magnitude to outweigh the interest savings to estimated revenue loss state revenue foregone by the exemption. on a hypothetical $1 million serial bond This study estimates the effect of the suggests that aggregate savings are state exemption of in-state municipal achieved by an exemption policy only if bond interest income on yields to matumore than half of state debt is held by rity and on state revenue losses. The esnonresidents. timates of the effects on yields are derived from a random sample of 1443 serial issues and their component bonds issued during the January, 1982 to June, 1990 HIRTY-THREE states and the Dis- period. Unlike most previous studies, Ttrict of Columbia levy an individual which do not use individual bonds, our inincome and exempt from taxation in- terest savings estimates are based on an terest income earned on bonds issued by analysis of the yield to maturity offered governmental units located within their on individual bonds within the serials. In borders, while taxing interest earned on contrast, most studies have analyzed other municipal securities. Such an ex- variations in an aggregate interest meaemption results in a loss of state revenue. sure, net interest costs (NIC).' Our data The justification for this tax expendi- also span the time period of the Tax Reture is the belief that it results in lower form Act of 1986 (TRA86), which has sigborrowing costs for in-state issuers. The nificantly affected the municipal bond reasoning is that state residents will ac- market. cept a lower yield on in-state securities We begin with a review of existing because of the state income exemp- studies of the effect of state income taxtion than they will accept on taxable, out- ation on municipal borrowing costs. This of-state securities. The prevalence of state review is followed by a discussion of the exemptions for in-state municipal income theoretical foundation for the study and suggests that this reasoning is widely accepted by state policymakers. the derivation of our estimating equation.

Local government finance in South Africa's cities: some preliminary notes

ABSTRACT This preliminary study describes the flow of resources through municipalities and Regional Services Councils in South Africa's cities. It argues that the main business of municipalities is the provision of traded services; characteristically, rates income accounts for about one fifth of total municipal income. The problems of black local authorities are examined in two case studies. The effects of RSC income and expenditure patterns are discussed, as is the burden of incorporating all residents of functional metropolitan areas into an adequate system of metropolitan authorities. Some principles to guide the evolution of a more effective local government finance system are adumbrated.

Fiscaliteit en politiek : het lokaal niveau : Een analyse in de 308 Vlaamse gemeenten

Due to the financial crisis of the Belgian central administration and the financial difficulties of local government, municipal taxes are gradually taking a higher place in the rank of municipal income sources. One could expect a differentiation between the presence of some political parties in the board ofmayor and aldermen (the local majority) on the one hand and the burden of taxation (and its amount of increase) on the other hand. Concerning this amount of increase, the data showed no evidence to prove that differentiation in the Flemish municipalities. Still we noticed a small variation in the burden of taxation according as to theweight of the socialist group within the local majority. Nevertheless factors as population and the level of mean income in the municipalities were more important to explain the burden of taxation. The results of the municipal-council elections of 1988 are not affected by the increase of the local burden of taxation.

Municipal income tax: The St. Louis case

Municipal income tax: The St. Louis case

THE USE OF SMALL AREA INCOME ESTIMATES IN MUNICIPAL CREDIT ANALYSIS

STANDARD PRACTICE for years has been to place major emphasis on taxes and values in appraising the credit worthiness of municipal bonds. Changes in the tax structure of state and local governments during the last two decades cast doubt on the efficacy of this type of appraisal under today's conditions. Sources of state and local government revenue have shifted from property oriented taxes and continue to shift to oriented taxes such as sales, license, and income taxes. Personal and real taxes, at one time the major source of revenue, now constitute a considerably less important part of state and municipal income than they did prior to World War II. Evidence of the importance of this shift is provided in the conclusions of a study of the tax systems of local governments in Iowa and the six surrounding states which indicate that revenues from taxes account for a somewhat smaller share of total tax revenues.' Since this change appears to be permanent, and gives every indication of assuming even greater importance in the future, it should be recognized in the analysis of municipal bonds as investments. Measures of debt-payingability based on taxes and assessed valuations do not seem to be adequate in the evaluation of municipal credit. Because of the shift from taxes to taxes having as their source the income of the inhabitants of the area, municipal ability to service outstanding debt is often more a function of the individual income receipts than of values.2 A technique of municipal credit appraisal should therefore place more emphasis on aggregate individual income of the local government area. Generally the statistical tools that are used in making an analysis

The municipal income tax: Its History and Problems. By Robert A. Sigafoos. Chicago, Public Administration Service, 1955. xiii, 169 pp. $5.00

The municipal income tax: Its History and Problems. By Robert A. Sigafoos. Chicago, Public Administration Service, 1955. xiii, 169 pp. $5.00

Municipal Income Taxation in the United States

Municipal Income Taxation in the United States