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Explaining the Trend Toward City Managers *

By Steven F. Kreft

Abstract

Previous research has concluded that there are no significant differences in efficiency between the two major forms of U.S. city government: elected mayor-council (EMC) and council-manager (CM). What remains then, is a puzzle as to why so many cities are switching from an EMC form to a CM form. The aim of this paper is to provide explanation for the recent trend towards adopting the CM form of government. This paper hypothesizes that the large budget items analyzed in the previous literature, are not adequate to fully capture differences in the efficiency of city spending patterns. Relying on the capitalization theory of local public services and taxes, I develop a hedonic price model for home sales occurring in the six largest Ohio cities, in 1991. Results show that houses within a CM city have a pricing premium that can be attributed to the greater efficiency of the CM form of government

Year: 2002
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