Escape from the City? The Role of Race, Income, and Local Public Goods in Post-War Suburbanization
NBER Working Paper No. 13311
Affluent towns often deliver high-quality public services to their residents. I estimate the willingness to pay to live in a high-income suburb, above and beyond the demand of wealthy neighbors, by measuring changes in housing prices across city-suburban borders as the income disparity between the two municipalities changes over time. I find that a $10,000 increase in town-level median income is associated with a seven percent increase in housing values at the border. The estimated demand for high-income municipalities is primarily driven by school quality and lower property tax rates.
This paper was revised on May 8, 2013
Document Object Identifier (DOI): 10.3386/w13311
Published: “Was Postwar Suburbanization 'White Flight'? Evidence from the Black Migration.” Quarterly Journal of Economics, 2010.
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