Municipal Capital Maintenance and Fiscal Distress

Authors

Mary Bumgarner, Kennesaw State UniversityFollow
Jorge Martinez-Vazquez, Georgia State UniversityFollow
David Sjoquist, Georgia State UniversityFollow

Document Type

Article

Publication Date

1991

Abstract

This paper formalizes and empirically tests the hypothesis that the deficient maintenance of public infrastructure is caused by fiscal distress. We utilize a production-decision framework in which public officials combine maintenance and new capital to produce a desired level of capital services. The behavior implied in the fiscal distress hypothesis is treated as perverse deviations from the optimal production path. The empirical findings from cross-sectional expenditures data give support to the fiscal distress hypothesis.

Comments

Originally published in:

Bumgarner, Mary, Jorge Martinez-Vazquez, and David L. Sjoquist. "Municipal Capital Maintenance And Fiscal Distress." Review Of Economics & Statistics 73.1 (1991): 33.

Posted with the permission of the publisher, MIT Press.

Recommended Citation

Bumgarner, Mary, Jorge Martinez-Vazquez, and David L. Sjoquist. "Municipal Capital Maintenance And Fiscal Distress." Review Of Economics & Statistics 73.1 (1991): 33.