The effects of local authority fiscal decisions on population levels in urban areas

Cuthbertson K., Foreman-Peck J. and Gripaios P. (1982) The effects of local authority fiscal decisions on population levels in urban areas, Reg. Studies 16, 165–71. The possible effects of local authority tax and expenditure decisions on population levels in local authority jurisdictions have largely been ignored in the UK, despite both theoretical and empirical work in the USA which suggests that such effects could well be important. This paper examines whether discriminatory local fiscal policies are indeed an important determinant of borough population levels in the UK, by first presenting a simple model of population determination and then testing it with 1971 cross section data for the thirty-two London boroughs. The results suggest that both expenditure and tax policies do have important effects on population levels, the composite effects depending on the extent to which expenditure is financed from domestic rates.