On the Measurement of Benefits in an Urban Context: Some General Equilibrium Issues

21 Pages Posted: 19 Jun 2004 Last revised: 8 Sep 2014

See all articles by Paul Courant

Paul Courant

University of Michigan at Ann Arbor - Gerald R. Ford School of Public Policy; National Bureau of Economic Research (NBER)

Daniel L. Rubinfeld

University of California at Berkeley - School of Law; National Bureau of Economic Research (NBER); NYU Law School

Date Written: November 1975

Abstract

The validity of using local market data to measure the benefits associated with policies adopted in an urban area is investigated .It is shown that the rest of the world is affected by taxing decisions undertaken in a single urban area, so that local data cannot perfectly measure the welfare effects of a policy change. Specifically, the fact that the willingness to pay for a tax increase is positive in the rest of the world suggests that cost-benefit analyses which do not account for the rest of the world may be biased.

Suggested Citation

Courant, Paul N. and Rubinfeld, Daniel L., On the Measurement of Benefits in an Urban Context: Some General Equilibrium Issues (November 1975). NBER Working Paper No. w0114, Available at SSRN: https://ssrn.com/abstract=260304

Paul N. Courant (Contact Author)

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