Tax competition within Metropolitan areas.

Summary This thesis focuses on the policy choices of local governments, such as municipalities, that face high mobility of capital, residents, and workers. The literature on tax competition has paid very limited attention to this high mobility of economic agents at the local level. Household mobility has mostly been ignored. No unified model takes into account the mobility of capital, residents and workers. The research question of our thesis is: How do competing local governments in an urban agglomeration, faced with high mobility of capital, residents and workers, choose their various public policy instruments? It is of theoretical interest because it highlights the gaps in our knowledge of local government. It is also of empirical interest because the fiscal, socio-demographic, economic, and political data at the municipal level are among the most accessible.Our thesis can provide a better theoretical foundation for future theoretical work and help pave the way for new approaches to studying local government choices.