The Property Tax Gap: How Property Assessments Increase Taxation Within Minority Communities (Job Market Paper)
(with Carlos Avenancio-Leon)
Nearly every homeowner in the United States faces an ad valorem property tax levied on assessed home value. The proceeds are a central funding source for local government amenities including schools, parks, infrastructure, and public safety. This paper documents widespread and persistent deviations from an equitable-tax benchmark. Using panel data covering 118M homes in the US, along with geolocation detail for 75,000 taxing entities, we document existence of a nationwide “Assessment Gap". Within taxing jurisdiction, assessments are higher relative to market prices, both for minority homeowners and within high minority-share census tracts. As a result, the average black or Latinx homeowner bears a 10-13% higher tax burden for the same bundle of public services. We identify two channels generating the Assessment Gap, and show that this distortion can be addressed by a relatively simply algorithm using publicly available data.
Corporate Subsidies for Economic Development: Evidence on Dynamic Impact
Amazon's public auction for the HQ2 location, which garnered bids from hundreds of cities in amounts commonly exceeding a billion dollars, was a high-profile example of a regular and widespread regional economic development tactic: providing public money as financial incentive to spur business activity. More than 300 billion dollars of public funds have been spent in this manner of the past 25 years. Using a comprehensive data set of corporate subsidies granted by local, state and federal governments, I examine the long term regional impact on public budgets and economic outcomes. I find evidence supporting the regional efficacy of these subsidies through an in-migration channel, suggesting potential strategic interaction effects between areas offering subsidies as a competitive tactic.
In the Eye of the Legislator: Does Early Experience Shape Congressional Attitudes Towards Tax and Policy?
(with Ulrike Malmendier)
Many politicians share how their life experience and childhood formative events have shaped them into the perfect candidate for office. Is this narrative simply an easy way to script an engaging stump speech? Or are the viewpoints and political agendas of lawmakers indeed shaped by salient experiences prior to taking office? We assemble a novel dataset tracking where US Congress members have lived from birth onward, and their resulting exposure to quality-of-life attributes at the county level. We relate cross-sectional variation in early lifetime exposure to voting on the same attribute while in office decades later. We find significant predictive power on budget appropriations, and on overall legislative alignment as measured by political scorecards. Our findings have implications for political polarization and long-term legislative trends.
(with Carlos Avenancio-Leon)
Nearly every homeowner in the United States faces an ad valorem property tax levied on assessed home value. The proceeds are a central funding source for local government amenities including schools, parks, infrastructure, and public safety. This paper documents widespread and persistent deviations from an equitable-tax benchmark. Using panel data covering 118M homes in the US, along with geolocation detail for 75,000 taxing entities, we document existence of a nationwide “Assessment Gap". Within taxing jurisdiction, assessments are higher relative to market prices, both for minority homeowners and within high minority-share census tracts. As a result, the average black or Latinx homeowner bears a 10-13% higher tax burden for the same bundle of public services. We identify two channels generating the Assessment Gap, and show that this distortion can be addressed by a relatively simply algorithm using publicly available data.
Corporate Subsidies for Economic Development: Evidence on Dynamic Impact
Amazon's public auction for the HQ2 location, which garnered bids from hundreds of cities in amounts commonly exceeding a billion dollars, was a high-profile example of a regular and widespread regional economic development tactic: providing public money as financial incentive to spur business activity. More than 300 billion dollars of public funds have been spent in this manner of the past 25 years. Using a comprehensive data set of corporate subsidies granted by local, state and federal governments, I examine the long term regional impact on public budgets and economic outcomes. I find evidence supporting the regional efficacy of these subsidies through an in-migration channel, suggesting potential strategic interaction effects between areas offering subsidies as a competitive tactic.
In the Eye of the Legislator: Does Early Experience Shape Congressional Attitudes Towards Tax and Policy?
(with Ulrike Malmendier)
Many politicians share how their life experience and childhood formative events have shaped them into the perfect candidate for office. Is this narrative simply an easy way to script an engaging stump speech? Or are the viewpoints and political agendas of lawmakers indeed shaped by salient experiences prior to taking office? We assemble a novel dataset tracking where US Congress members have lived from birth onward, and their resulting exposure to quality-of-life attributes at the county level. We relate cross-sectional variation in early lifetime exposure to voting on the same attribute while in office decades later. We find significant predictive power on budget appropriations, and on overall legislative alignment as measured by political scorecards. Our findings have implications for political polarization and long-term legislative trends.