physician induced demand for surgery following up the earlier findings by fuchs on surgeon induced demand this paper makes numerous data and econometric improvements in conducting a test of neoclassical and inducement theories a simultaneous equation model is used to estimate physician demand and equilibrium fees for surgery from a sample of 350 psus over the 1969 76 period the results provide definite support for the notion of competitive market failure particularly in large metropolitan areas other things equal fees and utilization are higher in surgeon rich areas although our estimated shift elasticities were only about one third those found by fuchs a statistically significant albeit small price elasticity of demand for surgery was also obtained in contrast to fuchs increasing monopoly and disequilibrium models are also tested without altering the basic findings where surgeons were in short supply their availability significantly affected surgery rates although a small supply effect was found in plentiful areas as well

school finance reform assessing general equilibrium effects abstract in 1994 the state of michigan implemented one of the most comprehensive school finance reforms undertaken to date in any of the states understanding the effects of the reform is thus of value in informing other potential reform initiatives in addition the reform and associated changes in the economic environment provide an opportunity to assess whether a simple general equilibrium model can be of value in framing the study of such reform initiatives in this paper we present and use such a model to derive predictions about the effects of the reform on housing prices and neighborhood demographic compositions broadly our analysis implies that the effects of the reform and changes in the economic environment are likely to have been reflected primarily in housing prices and only modestly on neighborhood demographics we find that evidence for the detroit metropolitan area from the decade encompassing the reform is largely consistent with the predictions of the model

demand inducement and the physician patient relationship the physician patient relationship is a paradigm for any expert client relationship the physician both diagnoses the patient s illness and recommends a treatment this dual role gives the physician incentive to recommend treatments whose costs outweigh their medical benefits these socially inefficient treatments correspond to the notion of physician induced demand the level of inducement chosen by the physician is shown to depend on the price and potential medical benefits of treatment and the relative diagnostic skills of physician and patient this model offers several testable hypotheses some of which are confirmed by related studies

why do households without children support local public schools linking house price capitalization to school spending while residents receive similar benefits from many local government programs only about one third of all households have children in public schools we argue that capitalization of school spending into house prices can encourage even childless residents to support spending on schools we identify a proxy for the extent of capitalization the supply of land available for new development and show that towns in massachusetts with little undeveloped land have larger changes in house prices in response to a plausibly exogenous spending shock towns with little available land also spend more on schools we extend these results using data from school districts in 46 states showing that per pupil spending is positively related to the percentage of developed land this positive correlation persists only in districts where the median resident is a homeowner and is stronger in districts with more elderly residents who do not use school services and have a shorter expected duration in their home our findings support models in which capitalization encourages the provision of durable local public goods and provides an additional reason why some elderly support local school spending

capitalization and the theory of local public finance the tiebout literature is incomplete this paper argues because it has not fully accounted for the capitalization of local fiscal variables into house values the paper explains why capitalization arises why it persists in long run equilibrium how it affects both residential location and the outcome of local voting and why it interferes with the efficiency of a system of local governments the analysis which is based on the main tiebout assumptions plus a property tax combines a model of household bids in a housing market with a median voter model of local public service determination

tax incidence in differentiated product oligopoly abstract we analyze the incidence of ad valorem and unit excise taxes in an oligopolistic industry with differentiated products and price setting bertrand firms both taxes may be passed on to consumers by more than 100 percent and an increase in the tax rate can increase short run firm profits and hence the long run number of firms we provide summary conditions for these effects to arise the conditions depend on demand curvatures and are written in elasticity form surprisingly the analysis largely corroborates cournot results with homogeneous demand

a new approach for identifying the parameters of a tax capitalization model abstract this study re estimates property tax capitalization rates with two empirical innovations first the underidentification problem inherent in all capitalization studies is resolved using estimates of rental values instead of estimates of the net user cost second the methodology along with the utilization of a unique data set mitigates biases resulting from potential correlations between property tax rates and unobservable amenities or public services the extent of tax capitalization estimated here is greater than estimates reported in many recent studies and is statistically indistinguishable from full capitalization the study also provides insights regarding the variability of the net user cost of housing

measuring the social value of local public goods an empirical analysis within paris metropolitan area a non linear hedonic model is used to estimate the implicit marginal prices of 17 local public goods in a paris suburban area on an original data set of some 8200 housing units the results reveal a robust effect of local public school quality measured both by the fraction of junior high school students that are at least two years behind grade level and the student teacher ratio on house prices it is observed that housing owners marginal willingness to pay for reducing commuting time is roughly similar for public transportation than for car transportation another noticeable result is the complete capitalization of local taxes at a discount rate of 3 5 an illustration of the potential usefulness of the results for cost benefit analysis is also provided

systematic assessment error and intrajurisdiction property tax capitalization over the past twelve years considerable evidence has accumulated on the extent to which intercommunity differences in property tax burdens are capitalized into property values 17 21 8 7 25 recently linneman 14 has analyzed the validity of this evidence after taking into consideration alternative models of local government finance in the model that he believes best represents the spirit of the tax capitalization literature local government expenditures are financed wholly by property tax receipts he demonstrates that in this case a perfect correlation between taxes and public goods makes it econometrically impossible to estimate property value equations unless measurement errors and omitted variables are present he therefore asserts that existing results on the tax capitalization issue are of nebulous value

the interaction between forms of insurance contract and types of technical change in medical care a simple three parameter description of medical technology is introduced to investigate the relationships between technical change welfare and type of insurance contract the value of a particular change in technology depends on the existing form of contract the marginal equilibrium expected utility to consumers of different types of technical change hinges on the manner in which the insurance arrangement is designed to mitigate moral hazard these results open the way for a positive model of the effects of insurance arrangements on the types of technology that are adopted and the effects of technical changes on the prevalent forms of insurance contract

differential capitalization of local public service characteristics analysis of the capitalization of property tax and public service differentials has come a long way since oates s pathbreaking work oates 1969 it is now well established that interjurisdictional differentials in local property tax rates and public service levels are reflected to some degree in house prices heinberg and oates 1970 meadows 1976 mcdougall 1976 king 1977 in addition intrajurisdictional tax capitalization may occur due to local assessment practices church 1974 black 1977 edelstein 1974 bloom ladd and yinger 1980 however there has been little research undertaken exploring the possibility of intrajurisdictional public service capitalization intrajurisdictional tax and publicservice capitalization represents an important extension of the tiebout analysis of the local public sector tiebout 1956 while individuals may respond to differentials in public service levels and tax rates in their mobility and house purchase decisions it is not at all clear that these attributes are valued uniformly for all units within a jurisdiction it may be that the proximity of a unit to a school rather than school quality determines value or capitalization may depend more on structural characteristics such as the size of a house the neglect of this point has been in large part due to data limitations most studies assume either explicitly or implicitly that benefits from public services are uniform within jurisdictions studies using aggregate data on a jurisdiction or census tract unit of observation focus on the impact of interjurisdictional service differentials on the median valued house such data do not permit an exploration of the interrelationship between housing and public service characteristics studies utilizing micro data relate housing prices to jurisdiction wide expenditures or quality measures such as reading scores to test the capitalization hypothesis however these public sector characteristics are seldom related to individual housing characteristics and there has been little systematic study of the possibility of significant interaction between public sector and other housing and location characteristics

a capitalization approach to fiscal incidence at the local level this paper argues that an analysis of the capitalized burdens and benefits of the local public sector offers a simple straightforward and objective computational methodology to fiscal incidence at the local level this capitalization approach represents a major departure from the highly discretionary and imprecise computational environment of the reasonable assumptions and aaron and mcguire approaches it is initially discussed both from conceptual and operational points of view and then implemented using alternate procedures major limitations of the approach are then noted a comparative perspective on fiscal incidence results based on the capitalization approach and of earlier studies on this subject is provided in the concluding section of the paper during the past two decades several important studies have been published which investigate the redistributive implications of federal provincial and local government finances in canada all the canadian studies on the subject in general follow the methodology used for similar studies in the united states these studies differ as to the shifting of tax burden assumptions and the concept of income employed and understandably their results also vary accordingly a common criticism of these approaches is that their distribution conclusions depend crucially on what incidence hypothesis is chosen musgrave and musgrave 1976 394 all these studies merely illustrate what the distribution of fiscal incidence would be if the incidence assumptions were true the numerical es

the impact of proposition 13 on house prices in northern california a test of the interjurisdictional capitalization hypothesis it wen institute of business and university of california economic research berkeley center for real estate and urban economics wobkingipaper series these papers are preliminary ature their purpose 39 limul discussion comme h re they are not to be 39 or quoted ny publication without express permission of the author working paper no 80 11 the impact of proposition 13 on house prices in northern california a test of the interjurisdictional capitalization hypothesis by kenneth t rosen

the value of school facility investments evidence from a dynamic regression discontinuity design author s cellini stephanie riegg ferreira fernando rothstein jesse abstract despite extensive public infrastructure spending surprisingly little is known about its economic return in this paper we estimate the value of school facility investments using housing markets standard models of local public goods imply that school districts should spend up to the point where marginal increases would have zero effect on local housing prices our research design isolates exogenous variation in investments by comparing school districts where referenda on bond issues targeted to fund capital expenditures passed and failed by narrow margins we extend this traditional regression discontinuity approach to identify the dynamic treatment effects of bond authorization on local housing prices student achievement and district composition our results indicate that california school districts underinvest in school facilities passing a referendum causes immediate sizable increases in home prices implying a willingness to pay on the part of marginal homebuyers of 1 50 or more for each 1 of capital spending these effects do not appear to be driven by changes in the income or racial composition of homeowners and the impact on test scores appears to explain only a small portion of the total housing price effect c 2010 by the president and fellows of harvard college and the massachusetts institute of technology

the physician labor market in a managed care dominated environment i introduction health maintenance organizations hmos and other managed care arrangements are rapidly growing alternatives to fee for service ffs insurance in the united states hmo enrollment has grown from under 3 million in 1970 interstudy 1986 to over 46 million by early 1995 interstudy 1995 little is known about how these changes in health care financing will ultimately affect physicians incomes but managed care is undoubtedly altering the economic environment of medical practice the shift from ffs to salaried or capitated payment reduces physicians incentives to overtreat 1 further managed care plans control physicians access to their enrollees by monitoring practice patterns and removing overly aggressive doctors from their panels hmos also employ a different physician mix with fewer specialists than the mix that characterizes the ffs environment thus a hypothesized consequence of rising hmo market share is reduced demand for specialists wennberg et al 1993 estimate potential surpluses ranging from 10 for emergency medicine to 210 in pathology surpluses of these magnitudes would be expected to reduce earnings however until recently physicians have enjoyed stable or rising incomes simon and born 1996 this may be explained by asymmetric information between patients and physicians if patients are poorly informed about the effectiveness of treatment options doctors may be able to protect their incomes from the loss of patients to managed care by prescribing more aggressive treatment to their remaining ffs patients despite mixed evidence on the extent of supplier induced demand sid e g fuchs 1978 newhouse et al 1982 dranove and wehner 1994 rizzo and blumenthal 1996 this hypothesis remains popular among policymakers the proponents of quotas for the size and mix of the health workforce argue that the supply side of the health sector is simply impervious to signals from the demand side i t is widely believed that physicians enjoy almost total discretion in dictating the volume and composition of health care they render allow ing physicians to extract very high target incomes virtually regardless of the local physician to population ratio reinhardt 1994 interest in physician incomes arises in part from the central role that incomes play in sending appropriate signals about changing supply and demand conditions if ffs physicians can maintain their incomes as the ffs patient pool shrinks decisions about specialty location and hmos staffing patterns would have little reason to change alternatively if ffs incomes are sensitive to managed care penetration we would expect doctors to increasingly practice in areas and specialties in which employment opportunities have become relatively favorable pursue nonclinical positions or retire likewise hmos would reduce substitution towards non physician providers and away from specialist physicians the consensus among health workforce experts is that the u s has too many physicians and too many specialists relative to primary care physicians and that market adjustments will be insufficient to restructure the physician supply thus many health workforce experts and medical organizations have called for centralized workforce planning e g mitka 1997 committee on the u s physician supply 1996 pew 1995 cohen and todd 1994 schroeder 1994 wennberg et al 1993 proposals include limits on the number and specialty composition of residency positions restrictions on medical school class sizes and immigration by international medical graduates and incentive payments for early retirement retraining or diversion of physicians into non clinical positions before advocating interventions in the medical labor market it is worth exploring the potential for market forces to generate the desired physician supply changes many supporters of workforce policies presume that the failures of a ffs dominated physician services market would persist even in a radically different context

searching for leviathan comment and extension in a recent article wallace oates 1985 investigated whether fiscal decentralization tended to act as a constraining influence on the overall size of the public sector this hypothesis has been advanced by several alternative theories of government behavior including richard musgrave s 1959 model of how the distribution function of government would be carried out by subnational governments geoffrey brennan and james buchanan s 1980 leviathan model and the more traditional public choice model for example walter hettich and stanley winer 1984 all contend that the decentralization of tax and spending decisions introduces competition among governmental units seeking to attract citizens and other mobile resources and thereby constrains taxing power oates analyzed two data sets one pertaining to the state and local sector in the united states and the other consisting of a sample of 43 countries and found little empirical support for the decentralization hypothesis the purpose of this paper is to reconsider his analysis in the case of state and local governments specifically it will be argued that oates s measures of decentralization may be inappropriate to test the hypothesis furthermore by taking into account the structure or composition of local governmental jurisdictions within a state empirical support of the decentralization hypothesis can be marshaled for general purpose local governments such as counties and municipalities i measuring fiscal decentralization among the states

regional variations in the irregular economy a study of possible trends button k j 1984 regional variations in the irregular economy reg studies 18 385 392 this short paper presents an empirical investigation of the factors which produce regional variations in

house price responses to a national property tax reform abstract we show that house prices in general did not respond to a substantial cut in the national property tax in sweden the estimates are based on rich register data covering more than 100 000 sales over a time period of two and a half years because the swedish property tax is national and thus unrelated to local public goods our setting is ideal for causal identification of the property tax on house prices we observe price increases only in a small segment of the market containing properties with very high tax values we discuss but can admittedly not empirically discriminate between several potential explanations for why we find no evidence of capitalization except for the top segment of the market

estimating the residual demand curve facing a single firm this paper presents an econometric technique for estimating the single firm residual demand curve that does not require the estimation of demand cross elasticities the technique is particularly suited for the estimation of firm market power in product differentiated industries where cross elasticities are notoriously difficult to measure one estimated parameter is directly related to a firm s markup of price over marginal cost when product differentiation is extensive when an industry consists of a dominant firm and a price taking fringe when a consistent conjectures equilibrium is the correct oligopoly solution concept when firms are stackelberg leaders relative to their environment or when firms are perfect competitors the estimates can indicate power over price in other circumstances an instrumental variables technique is employed using firm individuated factor prices to identify firm specific residual demand yet even when instruments are unavailable the technique produces elasticity estimates biased in the conservative direction of disproving market power this methodology is applied to estimate the market power of three firms in an industry characterized by product differentiation brewing over our 1962 82 sample period pabst and coors had similar national market shares and each had high shares in several states yet pabst was virtually a price taker while coors possessed substantial market power anheuser busch had market power in the early part of the sample but little after 1975 when miller brewing changed the competitive nature of the industry

capitalization of interjurisdictional fiscal differentials an alternative approach abstract in virtually every study concerning capitalization of fiscal differentials into property values the unit of observation has been a local jurisdiction or an individual house sale within a jurisdiction urban economic theory suggests that capitalization of fiscal differentials should be most obvious at the border of two jurisdictions housing price differentials between adjacent blocks at the border of two jurisdictions will be used to study capitalization such an approach reduces problems associated with measurement of dis amenities and public services and with the use of a distance variable in urban areas with multiple employment or recreation centers

physician induced demand for childbirths a controversial technique for testing the hypothesis that physicians induce demand involves two stage least squares tsls regression analysis of cross section data on physician supply and utilization this paper tests the power of tsls by applying it where there is at most only a trivial amount of demand inducement the demand for childbirths we find evidence of inducement of childbirths calling into question the validity of the tsls approach this unlikely finding may be traced to at least two factors the first stage regression is not identified and the second stage regression does not adequately address border crossing

why are there nimbys an owner occupied home is an un usual asset because it cannot be diversi ed among locations and because it is the onlysizable asset that most owners possess among the unin sured risks of homeownership is devaluation by nearby changes in land use opponents of land use change are called nimbys not in my back yard this article submits that nimbyism is a rational response to the uninsured risks of home ownership it explores the possibilities and draw backs of providing an insurance market to cover such risks it concludes that some progress is being made towards developing such markets jel r52 residents who strenuously oppose devel opment of land in their immediate area are often called nimbys the acronymic per soni cation of the expression not in my backyard the oppositionof neighbors is an importantproblemin americanland use reg ulation itcanfrustrate the implementationof carefully planned residential development locally desired industrial development and placement of the necessary nuisances of ur ban life such as power plants and land lls downs 1994 fischel 1991 nelson 1999 portney 1991 rephann forthcoming nimbys sometimes appear to be irratio nal in theiroppositionto projects in the sense that they express far fetched anxieties or doggedly ght projects whose expected neighborhood effects seem small or even be nign i submit in this note that such anxieties might not be irrational if we consider that most nimbys are homeowners and that homeowners cannot insure their major and often only asset against devaluation by neighborhood effects nimbyism mightbet ter be viewed as a risk averse strategy i con clude with a few notes about how an insur ance market might be developed to head off

a three sector model for real property tax incedence abstract this article presents a new three sector general equilibrium model for tax incidence analysis the model differs from the usual two sector model not only in the addition of an extra sector but also in abandoning the classical tradition of specifying with capital and labor arguments the property tax in the model is specified as a partial tax applying to real but not to personal property used in the production of housing services and other goods the model is quantified by selecting numerical values for its parameters in order to estimate percentage changes in the endogenous variables caused by the introduction of an exogenous property tax the major effect of the tax is to make real property relatively more expensive and to cause less real property to be produced

environmental amenities as a source of market power site specific environmental amenities can provide a source of product differentiating market power using estimates from hedonic price equations and residual demand models our analysis recovers firm specific estimates of price markups as measures of market power and uses these markups to estimate the implied marginal value for access to coastal beaches the application involves rental price and occupancy data for several thousand beach properties along a portion of the north carolina coastline during the 1987 to 1992 rental seasons

what produces a hidden economy an international cross section analysis by economists the phenomenon has been discussed for a long time by politicians and the public in mediterranean countries such as italy where it is known as lavoro nero and in developing countries it is however quite new for it to be seriously studied by professional economists gutmann s estimate 14 that the hidden economy currently comprises at least 10 of officially measured gnp in the united states has received wide attention in the press and in congressional committees feige 8 comes up with a corresponding figure of 33 of gnp for 1978 and has more recently lowered it to 27 of official gnp for the same year 9 these two authors as well as many others point to the revolutionary consequences 15 16 of the existence of a hidden economy of such size in particular the official statistics provide mistaken signals to the public decisionmakers they are led to think that there is wide spread unemployment because of the official unemployment statistics while in fact a considerable amount of those unemployed do indeed work similarly there may be an underestimate of the rate of growth in income and an overestimate of the rate of inflation the importance of the untaxed hidden economy for public revenues is obvious the official measures leaving out or considering only in part the hidden economy may also lead to systematically biased estimates of econometric models at the micro and macro level the present study pursues three purposes the first is to identify problem areas of future economic policy both with respect to the causes producing and the countries being affected by a hidden economy it turns out that in several countries the problems created by a rising hidden economy are expected to be so significant that policy makers are well advised to direct their attention to the subject

assessing the efficiency of local open space provision abstract this paper tests the efficiency of local provision of land conservation i examine how housing prices which capitalize open space amenities and future tax obligations change after municipalities vote on referendums for conservation spending using a dynamic regression discontinuity based on voting outcomes results suggest that average housing prices increase about 0 68 1 12 for every 1000 per household of open space spending authorized which indicates inefficiency and underprovision of conservation i also examine tax capitalization and supply side explanations for estimated capitalization

property taxes and elderly mobility abstract the 2000 2005 housing market boom in the u s has caused sharp increases in residential property taxes housing rich but income poor elderly homeowners often complain about rising tax burdens and anecdotal evidence suggests that some move to reduce their tax burden there has been little systematic analysis however of the link between property tax levels and the mobility rate of elderly homeowners this paper investigates this link using household level panel data from the health and retirement study hrs and a newly collected data set on state provided property tax relief programs these relief programs generate variation in effective property tax burdens that is not due solely to arguably endogenous local community choices about taxes and expenditure programs the findings provide evidence suggesting that higher property taxes raise mobility among elderly homeowners the point estimates from instrumental variable estimation using relief programs to generate instruments suggest that a 100 increase in annual property taxes is associated with a 0 73 percentage point increase in the 2 year mobility rate for homeowners over the age of 50 this is an 8 percent increase from the baseline 2 year mobility rate of 9 percent these results are robust to alternative specifications

capitalisation of fiscal variables and land scarcity fiscal packages usually capitalise into house prices yet if enough land for construction is available housing developers could supply new houses and capitalisation may disappear this paper provides a theoretical model in which income taxes and public services capitalise at lower rates when housing supply elasticity increases using an empirical linear interaction model we estimate the impact of available land for construction on capitalisation rates with a panel of swiss communities results indicate that fiscal variables do not capitalise differently in communities where housing supply is constrained by land availability thus land availability is a necessary but not sufficient condition for capitalisation to disappear

physician response to fee changes with multiple payers this paper develops a general model of physician behavior with demand inducement encompassing the two benchmark cases of profit maximization and target income behavior it is shown that when income effects are absent physicians maximize profits and when income effects are very strong physicians seek a target income the model is used to derive own and cross price expressions for the response of physicians to fee changes in the realistic context of more than one payer under the alternative behavior assumptions of profit maximization and target income behavior the implications for public and private fee policy and empirical research on physician response to fees are discussed

estimating property tax capitalization a further comment in recent years an increasingly popular area of empirical investigation has concerned attempts to test tiebout s 1956 hypothesis that allocative efficiency in the provision of public services may be attained through a system of local governments 1 in his seminal contribution to the analysis of the tiebout hypothesis and the capitalization of property taxes oates 1969 reasoned that if consumers are sensitive to the public service benefits and property tax costs associated with home ownership these factors should be reflected in housing prices until recently most studies of the capitalization phenomenon have followed oates s specification in which housing values are regressed on a vector of housing characteristics public service measures and a tax price term 2 as several analysts have noted 3 however attempts to test the tiebout hypothesis by using an oates type equation must certainly lead to failure this is so because in a perfect tiebout equilibrium a marginal increase in housing value brought about by increased provision of public services must necessarily be offset by a marginal decrease in housing value caused by the added tax cost assuming that

the convergence of utility and profit maximization the literature discussing the conditions leading to the convergence of utility and profit maximization for owner controlled firms has a long history scitovsky initiated the discussion and derived the important result that in the short run utility and profit maximization are necessarily equivalent only when the several indifference curves of the owner are vertical displacements of each other 10 59 hereafter we refer to indifference curves that are vertical displacements of each other as the scitovsky condition ladd 6 restates scitovsky s model in mathematical form and reaches the same conclusion piron 8 extends scitovsky s analysis to the long run and concludes that utility maximizers also maximize profit recent contributions to the literature examine the issue of convergence when the entrepreneur receives nonpecuniary benefits from managing the firm olsen 7 concludes that a utility maximizer who derives benefits from being self employed does not necessarily maximize profit in either the short or long run feinberg 2 3 4 and schlesinger 9 conclude that utility and profit maximization necessarily diverge when the nonpecuniary benefits cannot be obtained outside the firm in contrast hannan 5 argues that utility and profit maximization necessarily converge even when nonpecuniary benefits exist a theoretically precise measure of the opportunity cost of entrepreneurial activity is crucial to this discussion profit is total revenue less all the opportunity costs of production including entrepreneurial activity a theoretically precise measure of the opportunity cost of such activity is therefore a prerequisite for a precise measure of profit scitovsky uses the indifference curve passing through the point indicating the choice of total leisure to gauge the opportunity cost ladd and piron follow scitovsky s procedure olsen feinberg and schlesinger hereafter ofs use the wage rate foregone as the indicator of opportunity cost

housing price functions and ownership capitalization rates abstract in this paper we examine the problem of consistently estimating capitalization rates and hedonic housing prices we specify a hedonic pricing model for housing that combines owner occupied and rental unit samples in a manner yielding hedonic prices not subject to selection bias and capitalization rates which vary with the age and family income of the residents we use the 1982 annual housing survey ahs for metropolitan philadelphia to obtain parameter estimates for this model our findings indicate that selectivity bias is present in price functions utilizing only owner occupied or rental unit samples our results further indicate that the mean annual capitalization rate for owner occupied units is approximately 10 however the capitalization rate is non monotonically related to both age of the head and family income

property tax shifting under imperfect competition the hedonic price models are commonly used to empirically assess the degree to which property taxes are shifted from property owners to property renters the findings of these studies vary sporadically in terms of the degree of tax shifting the competitiveness of housing markets may significantly influence the degree of tax shifting in this article we allow a nonzero price cost markup in the hedonic price equation and examine the impact of market power on property tax shifting in our case study we examine the property specific characteristics occupancy record and local property tax associated with hundreds of managed rental properties in central new hampshire the results show that depending on the degree of market power exercised by a property management firm the anti competitive structure of the market may significantly contribute to property tax shifting from property owners to property renters