The Fiscal Impacts of Urban Sprawl: Evidence from U.S. County Areas

Abstract
This paper examines the fiscal impacts of urban development patterns in the United States. Previous studies have indicated that low-density, spatially expansive development patterns are costly to provide public services leading to higher per capita expenditures. However, theory would suggest alternate outcomes. These two possibilities are examined empirically using a panel dataset of U.S. county areas from 1982 to 2012 and a specification allowing for a potential non-linearity between development patterns and per capita expenditures. Estimates indicate that the spatial extent of urban development is the most important, suggesting that more compact development is less costly to provide public services. Increased density increases per capita expenditures suggesting "urban harshness"; however, the effects are quantitatively small.
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