Abstract
Data from municipal governments with populations greater than 50,000 are examined to see the relationships between population density and per capita government expenditures and racial composition and per capita government expenditures. There is no statistically significant relationship between per capita total government expenditures and operational expenditures for cities smaller than 500,000, and for larger cities, higher population density is associated with higher per capita government expenditures. Infrastructure expenditures tend to decline with increases in population density for cities below 500,000, whereas expenditures on services tend to increase with population density for cities over 500,000. The relationship between per capita total expenditures and population density has the greatest policy relevance because it indicates that when all government expenditures are taken into account, policies that increase population density will not reduce per capita government expenditures, and in larger cities will lead to higher per capita government expenditures.
The results on the effects of racial composition on municipal government expenditures reveal a positive relationship between the race and municipal government expenditures. However, the majority of the literature focuses only on the police expenditure – race relationship but the data in this study reveal that there is a positive relationship between race and total, current operational, water, sewerage, and fire expenditures in addition to the relationship between race and police expenditures. This positive relationship is consistent with the majority of the literature.
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