On the Dynamics of Community Development / Levon Barseghyan, Stephen Coate.

Format:

Book

Author/Creator:

Barseghyan, Levon.

Contributor:

National Bureau of Economic Research.

Coate, Stephen.

Series:

Working Paper Series (National Bureau of Economic Research) no. w23674.

NBER working paper series no. w23674

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2017.

Summary:

This paper presents a dynamic political economy model of community development. In each period, a community invests in a local public good. The community can grow, with new housing supplied by competitive developers. To finance investment, the community can tax residents and issue debt. In each period, fiscal decisions are made by current residents. The community's initial wealth (the value of its stock of public good less its debt) determines how it develops. High initial wealth leads to rapid development. Low initial wealth leads to gradual development that is fueled by community wealth accumulation. Wealth accumulation arises from the desire to attract more households to share the costs of the public good. The long run size of the community can be too large or too small and development may proceed too slowly. Nonetheless, some development occurs and, at all times, public good provision is efficient.

Notes:

Print version record

August 2017.