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    ocal Economic Growth

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    © All Rights Reserved
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    11 views15 pages

    Local Economic Growth and Local Government Investment in Parks and Recreation, or Five Cheese Pizzas For $2.6 Million.

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    nicolas
    ocal Economic Growth

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    © All Rights Reserved
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    912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or five cheese pizzas fr $2.6 milion ocelot: 18 June 2021 | Accepted 15 Jy 2022 Dor 10271312554 RESEARCH ARTICLE OE WILEY Local economic growth and local government investment in parks and recreation, or five cheese pizzas for $2.6 million David M. Brasington ® Economies Department, Unversity of Chncinat, Cacia, 4, USA Abstract . ‘Amenities have been linked to economic growth, which has David M Brasington Economics Department, | been studied at the level of nations, regions, and urban University of Cincinnati 2426 Lindner Hal Lea eet as areas, We look instead at economic development at the (044 45221.0971, USA. highly localized level of cities, villages, and townships. We ee aN use regression discontinuity to estimate the effect of re Funding information ‘newing and cutting parks and recreation spending. We find (Charles P. Taft Research Center; University of an initial effect of $2.6 million in additional residential cert Cat Unde ee ee ae teat arta diminishing effects in subsequent years, We use votes to pene ones rd ranean ree ter fai is edocs hv i KeyworDs housing supply, local government taxation, local public services, regional development, regression discontinuity 1 | INTRODUCTION Economie grovith has traditionally been studied at the level of nations (Acemoglu, 2012; Ranis et al, 2000), states (Ravalion & Datt, 2002), and regions, ike NUTS2 (Faggian & McCann, 2005) and metropolitan statistical ‘areas (MSAs; Partridge, 2010). We collect economic growth data atthe most localized level we have seen: the local municipal units of cities, villages. and townships, which we sometimes call ‘cities’ for shorthand. As an istration, Lucas County, the primary county for the Toledo, Ohio MSA. has 400,000 people in an area of 341 miles? (80 km) spread across 5 cities, 6 villages, and 11 townships. Our measure of economic growth is novel, too. Prior studies often measure economic growth by population, income, gross domestic product, and Indices that include factors, like health. The current study measures grovith by the value of newly constructed residential structures, This measure captures redevelopment as well asthe in-migration of population. both Indicators ofthe attractiveness ofa city. It fs important to put population changes into context in Ohio, because Regional 3 20226238395 ‘lcyonindivar-comfouralies © 2024 Wiley Prodcak UC | 81 hitpsfontinelibrary-wiley-com.ezproxy.unl.edu.codolepa10.111Jors.12554 roe > orton sone med ov oe as 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or fve cheese pizzas fr $2.6 milion 2 _L wie y_Saammrersnessrm ——__tvssrow the population of Ohio has remained constant since 2000. There is migration into and out ofthe state, of course, but with replacement-level birth ates it s far to credit most changes incity-level population to intercity flows. We find that bardly renewing tax levis fr parks and recreation causes $2.6 milion more residential development than that in otherwise similar ces that barely fall the tax levies. The $2.6 millon effect i forthe fist year after the vote alone. This effect diminishes to $20 milion and $1.4 milion 2 and years after the tax levy, and essentially ssipates in the fourth yer. Tiebout (1954) sort over environmental quality, and the types of people who sort to it are more likely to attend ‘or watch NASCAR, have higher incomes, and describe themsolves as politically very liberal (Brasington, 20173). “These may be two distinct groups of people, The current study finds that cutting funding on parks and recreation reduces new residential construction, adding tothe finding that cutting parks and recreation spending also causes ‘more demolition of residential property (Brasington, 2021). The results are based on 2 unique data set of 1745 votes on parks and recreation tax levies by local gov exnments in Ohio, These votes are matched to other characteristics, including the value of newly constructed houses. Regression discontinuity compares the value of new residential construction for cities that barely renew and barely fal to renew the tax. There Is an issue about the Independence of votes uncovered by Cellini etal (2010), and independence of votes is an assumption of the classical near regression model. To preserve independence. the study examines only votes to renew spending. Park boards endogenously choose when to ask for additonal tax money, while the timing to renew a tax that is about to expe is exogenous ta the park board. The tse of renewal levies provides diferent treatment effect estimates than the use of now tax levies Part of the difference may stem from reduced bias, but part of the difference may reflect an asymmetric effect of spending more versus cutting spending on parks and recreation. ‘The estimates come from the use of the regression discontinuity design. Most studies on the economic impact (of environmental amenities use least squares, spatial models, and input-output modeling. While these studies advance our understanding of the issues, they ae not based on randomization and are therefore subject to omitted variable bias (Baum Snow & Ferrera, 2015). Regression discontinuity essentially creates a randomized experiment in a narrow window around a cutoff point. As a consequence, it has been shown to produce estimates that are statistically identical to those from randomized experiments (Berk et al, 2010; Buddelmeyer 5 Skoufis, 200%; Shadish otal, 2012) The assumptions required are minimal and testable, so we believe that another contribution of the study ists use of the powerful causa inference technique of regression discontinuity 2 | LITERATURE REVIEW “The current study is elated to iteratures on amenity-based econemic growth, migration, house price capitalization, health effects, and ecological tourism, Because of the importance of the topic, there isa rch Iterature on economic development at the level of nations, states, and regions. The current study deals with park and recreation spending, a local amenity, s0 2 bief sampling of the economic development literature as it relates to amenities is now discussed. Rodrigue? Pose and Ketterer (2012) examines population flows between 133 European regions between 1990 and 2006. Using panel data techniques it finds evidence that contradicts the caims of Faggian and McCann (2009) and Faggian et l. (2012), which say that economic candtions and not amenities affect the relative attractiveness of Eurapean regions for population flows. Specifically, it Finds a role For factors, ke higher January temperatures, Fewer clouds, scenic landscapes, and variety in landscapes with touristic or recrestional value. These are exogenous factors, whereas the ‘current study shows a role for public policy in providing quality parks and recreational opportunities in a geography that by and large mimics fat, featureless pai, Knapp and Gravest (1989) discuss the role of location-specific amenities in regional migration, which causes regional development. It separates the discussion Into supply-side and demand-side factors, and suggests that hitpsilonlinelibrary-wiley-com.ezproxy una. ecu coldoilepat'0.111/fors-12554 7s pope 2828 ZeLSLON, 1 opn eon na -n ‘sna orev an pnd 26 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or fe cheese pizzas fr $2.6 milion susncron _jmareerergresrsyesseg-W 11.5: y__® ‘amenities are capitalized into wages, rents and other prices. Clark and Cosgrove (1991) find both economic factors and amenity differentials are important for explaining population flows between MSAs. Among, the important factors are the murder rate, rain levels, and population levels. The murder rate is a factor that could be affected by Jocal public spending on police protection (Levitt, 2002). Marré and Rupasingha (2020) show that itis not just natural amenities that can draw new residents but public services lke, schools as well finds that better schools can draw migrants to rural areas, and that the effect is larger for nonmetropolitan counties that are not next to metropolitan areas. This isan important finding for the current study, which aso shows a role for public policy in ‘development through the provision of public services. Like Marré and Rupasingha (2020), the current study includes rural areas ‘Albouy eta. (2021) compare immigration by US-born interstate migrants and foreign-born migrants to MSA. ft finds foreign immigrants are more willing to accept lower wages to locate in cities that are coastal, large, and have ‘deeper immigrant networks. They also choose cites that have similar winter temperatures, coastal proximity, and public safety as their home countries. Carlin and Saiz (201°) state that prior studies provide only indirect evidence ‘of the link between leisure amenities and population growth in urban areas. It surveys residents to develop a measure of how picturesque an MSA is It finds 10% higher population growth in urban areas between 1990 and 2010 in locations that are twice as picturesque-tied with taxes for importance. Partridge (2010) compares the relative importance of natural amenities and the increasing etumns to scale of new economic geography in explaining economic growth. Using MSA-level analysis the paper finds natural ame nities to be much more important divers of growth, Rickman and Wang (2047) find both natural amenities and urban agglomeration drive regional growth, but that demand for natural amenities Is more important for growth ‘outside of MSA. Hone (2014) conducts 2 pane! data estimation atthe individual level for Mexican immigrants to the United States, Finding that amenities matter for migration choices, especialy for older migrants. Gao and Sam (2019) use prefecture-level data for China with 2 panel data model. I finds that income levels and employment ‘opportunites matter. but that climate variables ke, winter and summer temperatures and availabilty of sunshine ae also related to in migration. ‘There isa substantial terature on the relationship between parks, urban forests, and green space on house: Prices. Most studies find a premium for proximity to such recreational areas that drops off with distance. Borgoni ‘et al (2018) look atthe effect of park size and proximity in Milan. Li and Saphores (2012) use a spatial Durbin model toestimate the effect of forests and grassy areas on the value of muitfamily housing units in Los Angeles, Wu and Dong (2014) find that the house price premium for proximity to parks in Bejing varies with a neighborhood's ‘eciucational attainment, crime levels, population density, and the presence of subway stations and schools LLutzenhiser and Netusi (2001) examines the effect of specialty parks, open area parks, and golf courses on house prices in Portland, OR. Melchar etal, (200%) ook atthe effect of proximity to urban forests on apartment prices in Prague. Garretsen and Marlet (2017) find that proximity to man-made recreational grounds can be negatively related to housing prices in the Netherlands. ‘There isa literature on the effect of park spending on health outcomes and participation in recreational activities. Humphreys and Ruseski (2007), for example, find that spending on parks and recreation gets people to participate more in group sports but not individual walking. ‘Another related strand of itrature looks at tourism as an economic development tool. This is perhaps the most bihiy related branch ofterature to the current study, although, unlike the current study, the geographies seem to be confined to rural areas. Typical ofthe genre is input-output modeling of recreational spending. Bergstrom etal. (1990) Find recreation spending in Five state parks in rural Georgia increases incomes, employment, and gross product. MeDanald and Wilks (1986) find the same for Cooloola National Park in Australia, but the input-output ‘models in Keith and Fawson (1995), which studies rural Utah, suggest economic tourism is nota viable strategy for ‘economic development. English (2000) examines the economic impact of vstor spending in the Florida Keys, and Marcouiller and Prey (2005) show how tourism dependence is related to both man-made recreation sites and natural amenities. hitpsilonlinelibrary-wiley-com.ezproxy una. ecu coldoilepat'0.111/fors-12554 7s pope 2828 ZeLSLON, opn eon na -n ‘sna orev an pnd 3s 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or fve cheese pizzas fr $2.6 milion | wie ey Sammrersnesm —__tssrow 3 | METHODOLOGY 3.1 | Independence of observations Collin eta. (2010) use regression discontiouity to gauge the effects of school building spending on house prices in California. I uses votes on new bond issues, and its the first study we are aware ofthat raises the idea that votes ‘may not be statistically independent. Subsequent stues preserve independence by choosing the first or the largest ‘observation, ke, the largest tax levy for the San Dimas school district during the sample period, The current study suggests that any strategy that uses new tax levis is flawed because the timing ofa new tax levy is endogenously chosen by the relevant taxing authority. Inthe case of parks and recreation tax levies in Obi, the relevant taxing authority is cty council for cities, oF the board of trustees for towmships and joint recreation istrict. City council may choose a time of rising incomes to propose a new tax o it may ask for new taxes if 2 large corporation relocates to the ares "New taxes in Ohio are proposed fora specific length of time. The majority of parks and recreation taxes inthe sample expire 5 years after being voted in. At the end of 5 years city councl will ask voters to renew the tax. I ‘the tax passes, the funding continues; if the tax falls, the city must cut spending on parks and recreation services. The timing of renewal is not chosen by city counck if a new tax passed in 2006 to last 5 years, city council wil propose to renew the tax in 2011. If the tax fais n 2011, the city can approach voters for new funding, but this wil bea new tax, nota renewal. For this reason, the study considers only renewal taxes to presorve the independence (of observations (Brasington, 20170). 3.2 | Regression discontinuity design Regression discontinuity is 2 study design first promulgated by Thistlethwaite and Campbell (1940), after which it was essentially ignored until recent decades. The approach sto find a situation where there isa fixed, known cutoff ‘to some continuous variable called the running variable. Subjects to one side ofthe cutoff receive treatment, and subjects to the other side act as 2 control group because they do not receive treatment. Under a minimal set of testable assumptions regression discontinuity controls for omitted variable bias, meaning that any estimate of 2 treatment effect represents the causal effect of receiving treatment, “The assumptions of regression eiscontinity are that no agent can precisely assign subjects toa specic value (of the running variable, and that subjects are similar in observable characteristics on either side ofthe cutoff. ts ‘also important to test whether random jumps in the data cause statistically sknficant treatment effect estimates, and whether characteristics of the subjects are smooth atthe cutoff or exhibit a discrete jump. These issues will be ‘examined in Section 4 33 | Estimating equation Fer each ty in time perio tlt X denote the proportion of votes in favor ofthe tox ew. Treatment and control ‘group dummies are denoted Dy =1 if Xe», where ¥ = 0.50, the cutoff of the running variable for passing the tox levy, and Dy = 0 otherwise, The observed outcome is Yer at De + BX + Mh +e, a ‘whore Vis the amount of new residential construction, and We is set of covariates. The treatment effect + measures the difference in the value of new residential construction between cites within a smal bandwidth of the hitpsilonlinelibrary-wiley-com.ezproxy una. ecu coldoilepat'0.111/fors-12554 7s pape 2828 ZeLSLON, opn a eonp RN i i i i 3 i : ans 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or five cheese pizzas fr $2.6 millon BRASINGTON Wi ey cutoff that barely renew and fails to renew their recreation tax levies It is estimated using the bias-corrected ‘estimator of Calonico etal. (2014, 2017, 2019) ‘There are many options for estimating the treatment effect in Equation (2). Five diferent bandwidth selection procedures ate tried, and tvee different kemel functions are estimated for each bandwidth selection procedure: uniform, triangular. and Epanechrikov. By showing a variety of bandwidth selection aptions~and by allowing for local-tinear and nonlinear estimation-readers ate abe to better gauge the robustness of the results 4 | DATA 4.1 | Voting data “The crux of the data isthe collection of votes on parks and recreation spending in Ohio from 1991 to 2018, These votes happen atthe ocal governmental level, Oia is divided into 88 counties. Each county is subdivided into about 15 townships, Residents may form a village ora city, the boundaries of which may cross township and county lines, “The primary cifferences betwen cities and vilages onthe ane hand and townships on the other hand are the form (of government and tax structure. Townships are governed by a board of trustees, while cities and vilages are [governed by a mayor and city council. While townships rely ently onthe property tax, cities and villages may also levy an income tax. Although there are joint park districts formed by more than one village, city, or township, the typical case is for each local government to operate its ov parks. ‘There are 1786 votes on park and recreation tx eves available to analyze. Mare recent years are available on the Obio Secretary of States website, The years 1995-2014 were avaiable asp files. A server crash in 1995 lft eater years of data unavailable in computerized format, but the remaining paper records were scanned into pa documents to rescue data from 1991 to 1994, As described in Section 1, o preserve the independence of votes, only the 832 renewal levies are analyzed. The value of the unrng variable X; Votes in Favor. is constructed from this data, 42 | Outcome data ‘The Ohio Department of Taxation keeps detailed records about the value of newly constructed property in each ‘governmental nit inthe state. Tax rates vary by special district, so the Department of Taxation keeps separate ines for property valu in a particular city that may span multiple counties, school istrcts, and fie districts, for example making it necessary to aggregate multiple lines of data up to the city level In this way Yq the value of newly ‘constructed residential property, is collected. It is denoted new residential construction in Table 1 ‘A key assumption of the regression discontinuity design is that no agent can precisely manipulate the running ‘variable. n the current cantext, evidence of precise assignment of the running variable would show a glut of voting, outcomes with just over 50% in favor, with a steep drop-off on the other side of the cutof. To assess this possibility, researchers typically perform a density test, ke the density test of Cattaneo et al. (2018, 2020). We perform the test for both the linear and nonlinear models. The est rejects the null hypothesis of no discontinuity only at p values of 0:14 for the linear model and 0.84 for the nonlinear model, both of which are higher than the ‘current standard of 0.05. The evidence suggests that there is no precise manipulation ofthe running variable 43 | Covariate data ‘A variety of covariates is avilable fom the US Consus. These covariates should be related to voting for parks and recreation spending, but they are not necessarily related to the outcome variable. The covariates also must not be hitpsilonlinelibrary-wiley-com.ezproxy una. ecu coldoilepat'0.111/fors-12554 7s pope 2828 ZeLSLON, opn eon na -n ‘sna orev an pnd 55 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or fe cheese pizzas fr $2.6 milion | wie y_Saammversnesrmm ——_tvssrow TABLE 1 Variable definitions Variable name Definition ‘Source New resident Value of newly constructed residential buldings In the ctyin.ONNo construction hundreds of thousands of 2010 US dollar, the outcome Department varable of Taation ‘Votes in favor Proportion of city residents yotes in favor of renewing 2 Secretary of ‘recreation tx levy inthe city, the running variable State's Office Covariates Poverty Proportion of individuals 18 years and oler living under the US Census poverty level 9% With ids Proportion at households with own children under 18 ving inthe Census houschold ‘Single-parent household Proportion of households in the cy with own children under age Census 418 living in the household with no spouse present Unemployment rate Proportion of population 16,years and older that is unemployed Census Income “Median family income in ety in 2020 US dollars Consus % Rent Proportion of housing units inthe city that renter-occupied Census % Under 5 years Proportion of persons ving inthe cty who are under 5 years old Census % Age 5-17 Proportion of persons ving in the ety who are from 5 to Census 7 years ld % Age 18-64 Proportion of persons ign the city who are from 18 to Consus GAyeas old % Minority Proportion of nonwite persons inthe ity Census % Never married Proportion of population 15 years and older who have never been Census ‘married Separated Proportion of population inthe ciy aged 1Syears and older Census ‘married but separated Divorced Proportion of population in the city aged 15 years and older who Census ‘re divorced Labor force Proportion of the population 16 yeas and older inthe city that Census aticipation rate participates in the labor force Notes Ohio Department of Taxation refers to Real Property Abstract by Taxing District. Secretar of State's Ofice refers te ‘pa les obtained from Melanie Poole, Serena Henderson, and Mia Yaiko ofthe Ohio Secretar of State's Office. Recreation renewal tax loves occurred between 1991 and 2018. Census refers to US Census Bureau The tor ty’ means vilage, city, or township that the house resides in outcome variables themselves, and therefore not change discontinuously atthe cutoff, testing for which is un- dertaken later in this subsection. Economie data, such as poverty status, income levels, and the labor force part pation rate are included. Parks and recreation being. normal goods, we would expect demand to rise with ‘economic characteristics. Variables are also included that are related to marital status and household characteristic. These include the percent of houscholds with children and the prevalence of single-parent households. Tenure status (rent vs. own) may be related to the demand for park services, as might the age distribution within a city so these covariates are included in the estimation. The percent of nonwhite persons is also added to allow fr different demands by ethnicity. hitpsilonlinelibrary-wiley-com.ezproxy una. ecu coldoilepat'0.111/fors-12554 7s pope 2828 ZeLSLON, opn eon na -n ‘sna orev an pnd ens 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or fe cheese pizzas fr $2.6 milion BRASINGTON EEE Wi ey” TABLE 2 Variable means by tax levy renewal status ‘Global sample socal sample Failed levies PssedTevies ‘Failed levies Passed Teves uteome voratie "New resident construction a1 156 168 99 Covarotes Poverty oat oz om ox2 % with kids 040 039 oat 039 Singlearent household oat on 010 ont Unemployment rate 04 0.06 005 005 Income 65.548 0939 67,286 eine % Rent 026 028 025 027 % Under 5 years 007 0.06 007 007 % Age 5-17 020 os o2t 020 % Age 18-68 059 059 059 059 % Minority 005 0s 008 oe % Never married 022 025 022 023 Separated 0013 oor oor 015 Divorees ont on on on Labor force participation rate 064 os 064 oss Number of observations 90 729 50 7 "Notes: Sample means shown atthe time ofthe recreation tax levy vote except fr the autcome varable, whieh Is new residential construction 1 yea aftr the tax levy vote. The global samples a ull sample of votes the local sample the set ‘f votes within 2 0.038 bandwidth othe vote share caf of 0.50 The number of observations shown for covariates; see Additional tables forthe number of observations for outcome variables Another key assumplion of regression discontinuity is thatthe sets of cities on either side of the cutoff have: Similar characteristics. Table 2 shows variable means for the group of cites that fils to renew the tax levy and the ‘group of cites that passes the tax levy. Means are shown forthe full sample and the local sample around the cutoff, “The effective bandwidth of 0.038 on either side ofthe cutoff comes from the regression of outcomes 1 year after the vote using a uniform kernel and a near Functional form using the methodology of Calonico etal (2019). The ‘group of citi that fais to renew has somewhat higher incomes~about $5000 higher on a base of $64,000—but this difference in incomes is probably not driving a difference in outcomes because the magnitude ofthe difference is modest and the correlation between income and the outcome variable is only 0.35. Covariate means are re rmarkably similar otherwise. Note that new residential construction ishigher forthe set of cities that vote to cut park funding. This seems curious given that renewing cities wil turn out to have 2 postive instead of a negative ‘treatment effect, but the means in Table 2 are unadjusted means. A similar phenomenon happens in Meyersson (2014), which finds a negative correlation between the outcome and treatment in the raw sample but 2 postive treatment effect in regression discontinuity estimates. Itisalso important to test whether the covariates change abruptly or smoothly atthe cutoff, Figures S1-$3 plot the values ofthe covariates asa function ofthe running variable. None appears to have much ofa discontinuity at hitpsilonlinelibrary-wiley-com.ezproxy una. ecu coldoilepat'0.111/fors-12554 7s pape 2828 ZeLSLON, opn eon na -n ‘sna orev an pnd 78 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or fve cheese pizzas fr $2.6 milion | wie y_ Sammons ——__tsstow the cutof A more formal tet isto use each covariate as the dependent variable in the estimation of Equation (1) OF the 14 covariates, two have p values les than 0.05 forthe treatment effect: 5 Under 5 years and % Minority Lee and Lemieux (2010, . 390) say researchers wil find some false positives in the presence of many covariates, and it suggests a seemingly unrelated regressions approach. A system of simultaneous regressions fs run with each ‘covariate as the dependent variable. The chi-squared test of joint significance has ap value oF 0.37, fling to reject the null that the continuity gaps forall covariates are zero. 5 | RESULTS 5.1 | One year after tax levy Plots of new residential construction for varius years after voting on parks and recreation tax levies against the proportion of votes in favor of renewal are avaiable in Figures $~S7. The formal analysis for construction 4 year after the vote appears in Table 3. TABLE 3 _Differencein new residential construction from renewing parks and recreation tx levies, 1 year after ‘vote ($100,000s US) Bandwidth selection procedure a @ @ @ a near estimates Uitorm 248 -1136 162 248 162 (075) (013) (039 ©79 (024) “angular 197 443 1442 1977 1492 (oon (050) (005) on (0.09) Epanechrikov 2408 397 21.82 2404 2192 (oon os (oon (eon (oon) Noninear tinates Uniform 1626 650 2552 2552 1826 (0.08) (052) (eon (oy (0.08) Triangular 2444 9.06 2532 2480 25.30 (oo) (030) (oon (eon (oon Epanecheikow 2873 gor 2680 2a7a 2660 (oon (os) (oon) on) (on) Notes: Regression discontinuity treatment effect estimates shown wit p value in parentheses below using a variety of ‘iferent options. Number of observations 775. Bandwidth selection procedures are bias-correced, mean-squared error ‘optimal bandwidths based onthe rdrobust command in Stata 2¢ detain Calica etal (2014, 2017) () a robust as ‘corrected bandwidth selection procedure that uses a common bandwidth on both sides ofthe cutof 2) allows two distinct bandwidths on ether side ofthe cutoff (3) selects the Bandwidth fr the sum ofthe estimates; selects the minimum of (2) and @ and (5) selets the median of (1}-(3) foreach side ofthe cutatt separately The near estimates use loca-linear regression forthe point estimates of the treatment effect and a local quadratic regression forthe bias correction, which are ‘the defaults forthe rérbust command. The nonlinear estimates alow quadatic and cubic regression forthe paint estimates and bias correction. Uniform, triangular, and Epanechrikov are diferent kemel functions to construct the lca plynomilextinators. The covariates lied in Table 1 ae inched inal regressions. The default varanee-covariance ‘matrix estimator is usee, which mandates that at least ce nearest neighbors are used inthe calculations hitpsilonlinelibrary-wiley-com.ezproxy una. ecu coldoilepat'0.111/fors-12554 ios oy prpening 28 28 ZLBLON, opn fa eonp mn i i i i 3 i : ans 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or fve cheese pizzas fr $2.6 milion BRASINGTON aE WIL Ey. Table 3 shows a statistically significant treatment effect for 8 out of 15 linear regressions and 10 out of 15, nonlinear regressions. The average treatment effect is 0.1 forthe linear regressions buta substantially higher 26.2 for the nonlinear regressions. The nonlinear regressions wil tun out to show a stronger, more consistent pattern of significance. Further interpretation is reserved for the next set of regressions. 5.2 | Two years after tax levy “Table 4 shows regression results forthe second year after voting on parks and recreation tax levy renewal. Table 4 shows an even less robust patter of significance forthe near regressions than the results for year 144, with only 4 out of 15 statistically significant treatment effects. The nonlinear results, on the other hand, are ‘even more robust than before, with significance achieved in 14 out of 45 regressions. The magnitude of the treatment effect has fallen for both near and nonlinear regressions. For the nonlinear regressions it has fallen from 262 to 19.8, which stil indicates $1.98 milion more residential new construction in cities that renew parks and recreation taxes relative to those that fal to renew. TABLE 4 _ Difference in new residential construction from renewing parks and recreation tax levies, 2 years after vote ($100,000 US) Bandwidth selection procedure a a o @ ow near estimates Uitorm 1312 2a aa79 1379 1332 (os) oa 002) (002) ©03) “angular 349 135 168 39 189 047) 079) (075) (0.49) om Epanechrikov 668 065 253 658 2m. (02 sn (45) (022) (042) Noninear tinates Uniform wr 2058 18.88 wr 1.88 (002) oon (oon (0.02) oo Triangular 1901 13.96 19.32 1932 19.24 (oon) (0.06) (oon (oon) eon Epanecheikow 2022 2aat 2075 2039 2096 (oon 00 (oon (oon) on Notes: Regression discontinuity treatment eftect estimates show wit p value in parentheses below using a variety of ‘iferent options. Number of observations is 769. Bandwidth selection procedures are bias-corrected, mean-squared erat ‘optimal bandwidths based onthe rdrobust command in Stata 2¢ detain Calica etal (2014, 2017) () a robust is ‘corrected bandwidth selection procedure that uses a common bandwidth on both sides ofthe cutof 2) allows two distinct bandwidths on ether side ofthe cutoff (3) selects the Bandwidth fr the sum ofthe estimates; selects the minimum of (2) and @ and (5) selets the median of (1}-(3) foreach side ofthe cutatt separately The near estimates use loca-linear regression forthe point estimates of the treatment effect and a local quadratic regression forthe bias correction, which are ‘the defaults forthe rérbust command. The nonlinear estimates alow quadatic and cubic regression forthe paint estimates and bias correction. Uniform, triangular, and Epanechrikov are diferent kemel functions to construct the lca plynomilextinators. The covariates lied in Table 1 ae inched inal regressions. The default varanee-covariance ‘matrix estimator is usee, which mandates that at least ce nearest neighbors are used inthe calculations hitpsilonlinelibrary-wiley-com.ezproxy una. ecu coldoilepat'0.111/fors-12554 ios oy prpening 28 28 ZLBLON, opn fa eonp mn i i i i 3 i : ons 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or five cheese pizzas fr $2.6 millon BRASINGTON | wie eyes ——__tvssrow 5.3. | Three years after tax levy Table 5 shows treatment effect estimates of new residential construction 3 years after the tax levy is held. Statistical significance has vanished for the linear estimates but stl remains the rule for the nonlinear ‘estimates, where 12 out of 15 estimates are significant. The magnitude of the trestment effect continues to fal fom 19.8 in the previous period to 14.1 three years after the tax levy. 5.4 | Four years after tax levy ‘Table 6 shows treatment effect estimates 4 years after the tax levy. Table 6 continues the trond of declining statistical and economic significance. Treatment effect estimates remain insignificant for the finear case, and the prevalence of significance has declined to 4 out of 15 estimates for the nonlinear regressions. If one were to interpret the nonlinear estimates, it would reveal an average treatment effect of 11.8, although zero would be a reasonable interpretation as well TABLE 5 _ Difference in new residential construction from renewing parks and recreation tax levies, years after vote ($100,000 US) Bandwidth selection procedure a a o @ ow near estimates Uniform 565 10 568 5.68 565 (03) (086) (039) (0.33) (033) Teangulae tat -199 450 450 2aa orn 0.08) (035) (035) os Epanechrikow -093 169 ost oat o72 (0.288) (075) (0.38) (088) (039) Noninear Uniform 1458 1080 up 1458 1295 (oz) 025) (007 (0.02) (©0 Trangular 1420 9.88 1200 1620 1359 oon) 014 (0.03) (oon) (0.02) Eponechrikov 1433 1462 1412 1499 1537 (o.02) (0.04) (0.02) (0.02) Cr) Notes: Regression discontinuity reatment effect estimates shown with p value in parentheses below using a variety of diferent options. Number of observations is 767. Bandwidth selection procedures ae bas-corrected, mean-squared erat ‘tinal bandwith based on the rérobust command in Stata, as detaled in Clon et al. (20%%, 2017). fsa robust bas ‘corrected bandwidth selection procedure that uses a common bandwith on both sides of the cut (2) lows two distinct bandwidths on ether side ofthe cutoff (3 selects the bandwidth fr the sum ofthe estimates: (4 selects the minimum of (1) and Gk and (5) selects the median of (1-13) foreach side ofthe cutoff separately The near estimates use ocatineat regression forthe point estimates ofthe treatment effect and a local quadratic regression fr the bias correction, which are the defaults forthe rdrobust command, The nonlinear estimates alow quadratic and cubic earession forthe point ‘estimates and bias correction. Uniform, tlangular, and Epanechrikov ae different kernal functions to construct the lca polynomial estimators. The covariates Fisted in Table 1 are included in all regressions. The default variance-covariance tmatrix ertimator fs used, which mandstes that at last dee nearest neighbors are used in the calculations hitpsilonlinelibrary-wiley-com.ezproxy una. ecu coldoilepat'0.111/fors-12554 7s pope 2820 ZeLSLON, opn eon RN ns i i i i 3 i : 1015 912122, 13.11 Local economic growth and local goverment investment in parks and recreation, or fe cheese pizzas fr $2.6 milion BRASINGTON EW ey!” TABLE 6 Difference in new residential construction from renewing parks and recreation tax levies, 4 years after vote ($100,000s US) Bandwidth selection procedure a e a wi ow near estimates Uniform -229 121 -099 -093 246 on 2a) 08) (038) (028) Triangular -208 -022 “246 -208 -209 (045) 097) (04) (029) (070) Epanechnikow -170 “147 -238 “170 168 om 0.80) (08) (078) om Noninoar catimotes Uniform 1074 626 1206 1374 1206 (0.05) (032) (007 (005) (on Triangular 938 1303 oat oar on oan 0.03) (0.08) om (©08) Epanechrikow 9.6 727 850 9.36 280 (013 018 (014) (0.13) 019 Notes: Regression discontinuity reatment effect estimates shown with p value in parentheses below using avaricty of

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