Like every other theorem, it depends on restrictive, unrealistic assumptions that I've forgotten.
Contra your statement, however, everyone doesn't necessarily want to pay the same for public services. The clumping together by income does not refute Tiebout. You could say their income reflects their willingness to pay. It also minimizes their tax price for services. In this context, in principle anyone would want to exclude anybody with lesser income from their tax jurisdiction, since the latter would enjoy a distributional advantage in taxes-v-services. Or you would seek a jurisdiction where everybody was richer. As Mark Twain said, you wouldn't want to join a club that would have you as a member. mbs I'm far from being an expert on this stuff, but this seems totally off-base even by neoclassical standards. It's not a matter of preferences. Almost everyone wants "lots of parkland, well-maintained roads, large police forces and good schools." The rich people clump together in towns and villages (like the ones near where I grew up in Illinois, where Donnie "Brasco" Rumsfeld was congresscritter) because they can live with their own kind -- and they can exclude others from the benefits. (In Kenilworth, Il, where I believe Rumsky lived, it was the Scottish.) -- Jim Devine / "There can be no real individual freedom in the presence of economic insecurity." -- Chester Bowles -- ---------------------------------------- I am using the free version of SPAMfighter for private users. It has removed 9219 spam emails to date. Paying users do not have this message in their emails. Try www.SPAMfighter.com for free now!
