Consuming Government

Abstract

In The Homevoter Hypothesis: How Home Values Influence Local Government Taxation, School Finance, and Land Use Policies (2001), William Fischel argues that the political economy of local government is dominated by “homevoters”– homeowners who support policies that will ultimately raise the value of their homes. The homevoter is an extension and modification of Charles Tiebout’s famous theory of the “consumer-voter”– the citizen who chooses where to reside based on her preferences for a certain local government tax and spending package. The consumer-voter “votes with her feet” by selecting the jurisdiction that most reflects her preferences. In his book, Fischel adds homeownership as a mechanism by which consumer-voters assess the quality of local government. Fischel argues that homevoters are beneficial and that they will invest in the local community in ways that non-homeowners will not. By extension, he argues that contrary to conventional wisdom local homevoter-dominated governments will engage in races-to-the-top in areas like education and environmental protection.

This review of The Homevoter Hypothesis argues first that Fischel’s account is highly stylized and depends on certain assumptions that do not often obtain. One such assumption is that local government policies can have positive or negative effects on home values, when other factors might be more determinative. Another assumption is that homeowners desire increased property values, when many homeowners worry about being priced-out of a community. To the extent that Fischel does capture a sub-set of the suburban political economy, one then has to ask whether this is an attractive form of local governance – a question I take up in the remainder of the review. Fischel likes – and wants us to like – the homevoter. Yet, his normative claims are just as stylized as his descriptive ones. In a local political economy premised on property values, virtually all the homevoter's energy is directed towards guarding the jurisdictional gates of her community. This obsession with entrance has some positive effects – homevoters are vigilant about keeping their immediate neighborhoods free from polluting industries, for example – but it also has serious negative ones. Fischel has little to say about the distributional consequences of a political economy that gives the homevoter almost unfettered control over who gets to move in next door, and that reduces significantly the options for those who are barred. The losers in the inter-local competition for homeowners – the urban poor, racial minorities, families in search of affordable housing, the elderly – are nowhere to be found in his account of local power.

Keywords: Local Government Law, Tiebout, home ownership, suburbs, city, consumer-voters, homevoters, zoning, land use, economic development