Tiebout without politics

David Pines*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

23 Scopus citations

Abstract

This paper re-examines the existence of a Tiebout-type equilibrium with price-taking developers. It is shown that, under Tiebout's assumptions, including perfect replicability of communities, such an equilibrium exists and is efficient. But if communities cannot be replicated, equilibrium with profit-maximizing developers may not exist, unless strong assumptions regarding the preference and the production technology are adopted. Since the assumption of perfect replicability is in itself unrealistic in view of the uneven local amenities' distribution in space, equilibrium with profit-maximizing developers may not exist in the real world. Consequently, some form of political process is indispensable for efficient inter-community population distribution.

Original languageEnglish
Pages (from-to)469-489
Number of pages21
JournalRegional Science and Urban Economics
Volume21
Issue number3
DOIs
StatePublished - Nov 1991

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