State and Local Tax Deductibility and Metropolitan Migration

The purpose of this study is to examine the extent to which metropolitan dwellers would likely "vote with their feet" in response to the elimination of state and local tax deductibility. Incremental outmigration from metropolitan areas in California as well as high tax (and income) states in the East and Midwest would be substantial. In addition to the numbers and higher incomes of workers induced to move by rising tax prices (costs) of public goods, such cities would lose considerable human capital as well. Finally, the elimination of state and local tax deductibility would likely exacerbate existing local funding problems in education across metropolitan America.