FISCAL IMPACTS OF LOCAL-POPULATION GROWTH - A CONCEPTUAL AND EMPIRICAL-ANALYSIS

This paper examines the legitimacy of concerns of local residents abou t the adverse fiscal impacts of population growth. The conceptual disc ussion shows that economic theory provides no clear prediction of the impact of population growth on per capita spending. Based on a nationa l data set of large counties, simple descriptive analysis indicates th at greater population growth is associated with higher per capita curr ent spending and interest outlays. More detailed analysis both of 1978 -85 changes and of 1985 levels of current spending indicates that high er growth-related per capita spending primarily reflects the combined effects of greater density and increased local spending shares. In sum , established residents in fast-growing areas may experience declines in service quality as well as rising local tax burdens.