A BRIEF EMPIRICAL NOTE ON THE TIEBOUT HYPOTHESIS AND STATE INCOME TAX POLICIES

In: Public choice, Band 67, Heft 1, S. 87-90

Abstract

TIEBOUT (1956) HYPOTHESIZED THAT "...THE CONSUMER-VOTER MAY BE VIEWED AS PICKING THAT COMMUNITY WHICH BEST SATISFIES HIS PREFERENCE PATTERN FOR PUBLIC GOODS...THE CONSUMER-VOTER MOVES TO THAT COMMUNITY WHOSE LOCAL GOVERNMENT BEST SATISFIES HIS SET OF PREFERENCES." BASED ON THIS ARGUMENT, THIS BRIEF NOTE SEEKS TO EMPIRICALLY EXAMINE THE IMPACT OF STATE INCOME TAX POLICY UPON THE GEOGRAPHIC MOBILITY OF CONSUMER-VOTERS IN THE UNITED STATES. THE AUTHOR SEEKS TO DETERMINE WHETHER THE EXISTENCE OF A STATE INCOME TAX SIGNIFICANTLY INFLUENCES THE IN-MIGRATION OF CONSUMER-VOTERS. THE ANALYSIS FOCUSES ON THE ELDERLY AND CONCLUDES THAT THEY EXPRESS A STRONG PREFERENCE FOR STATES WITHOUT PERSONAL INCOME TAXES.