Property Value Assessment Growth Limits, Tax Base Erosion and Regional In-Migration

Skidmore, Mark; Tosun, Mehmet Serkan

doi:10.2139/ssrn.1599004

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Property Value Assessment Growth Limits, Tax Base Erosion and Regional In-Migration

IZA Discussion Paper No. 4906

34 Pages Posted: 3 May 2010

See all articles by Mark Skidmore

Mark Skidmore

Michigan State University - Department of Agricultural Economics

Mehmet Serkan Tosun

University of Nevada, Reno - Department of Economics; IZA Institute of Labor Economics

Abstract

In 1994 a limit on the growth of property values for tax purposes was imposed in Michigan. One consequence of the newly imposed assessment growth cap was an emerging differential in tax prices between potential new property owners and long-time property owners. The purpose of this paper is to examine the impact of this growing tax price differential on migration patterns. Using county level data on migration activity over the 1994-2006 period, we present evidence that differential tax prices resulting from the assessment growth cap have reduced in-migration.

Keywords: property tax, tax base erosion, regional migration, Michigan

JEL Classification: H71, H73, J61

Suggested Citation: Suggested Citation

Skidmore, Mark L. and Tosun, Mehmet Serkan, Property Value Assessment Growth Limits, Tax Base Erosion and Regional In-Migration. IZA Discussion Paper No. 4906, Available at SSRN: https://ssrn.com/abstract=1599004 or http://dx.doi.org/10.2139/ssrn.1599004