Does the U.S. Tax Treatment of Housing Promote Suburbanization and Central City Decline

摘要: This paper examines the role of U.S. housing-related tax expenditures in creating incentives for decentralization and encouraging residential sorting by income central city decline. Tax associated with deductibility mortgage interest property taxes make housing less expensive relative to other goods and, hence, increase quantity land purchased lower density urban areas. Because consumption services, they cost geographic typically exclusionary zoning land- market imperfections. A direct consequence this process is that are concentrated communities highest incomes house values. These effects do not arise simply because housing-tax policies alone, but rather from interaction these factors affect local real e state markets, such as or fixed capital stocks. Three models developed formally analyze issues. In authors' base case model which there no land-use constraints amenities fixed, deductions related home ownership result population within metropolitan area a dense city, induce income. Moreover, prices subsidy increases aggregate demand all communities. Thus, mere presence federal decentralization, cannot generate America's patterns conclusions change an important way second constraint, type minimum lot-size prevalent suburbs, introduced. case, subsidies foster separation rich poor. Inco me results, consequently, increasing concentration poor city. However, still weakening markets model. The third final endogenizes production sense made function community three characteristics common American form result: area, increased core, weak markets. results indicate current reflects, at least part, arising national systems, than unique tastes low-density living environments.