Local Public Finance
Goldman School of Public Policy Working Paper: GSPP07-101 (May 2008)
Abstract
The mobility of consumers and producers in response to fiscal incentives gives the study of local public finance its distinctive
character. Households and firms are partitioned into spatial units on the basis of preferences, costs and the incentives provided by
local tax and expenditure policies. These fiscal incentives are, in turn, chosen by the members of each of these jurisdictions or
clubs. Externalities within and between these localities greatly affect the efficiency of taxation and the provision of public goods
and services.