Economic Development and Public Finance Working Paper Series

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This paper addresses four fundamental questions about the relationship between “smart growth,” a fiscally motivated anti-sprawl policy movement, and public finance: Do low-density, spatially extensive land use patterns cost more to support? If so, how large of an influence does sprawl actually have? How does the influence differ among types of spending? And, how does it compare to the influence of other relevant factors? The analysis, which is based on the entire continental United States and uses a series of spatial econometric models to evaluate one aggregate (total direct) and nine disaggregate (education, fire protection, housing and community development, libraries, parks and recreation, police protection, roadways, sewerage, and solid waste disposal) measures of spending, provides the most detailed evidence to date of how sprawl affects the vast sum of revenue that local governments spend every year.