Local Capital Spending in U.S. Metropolitan Areas

Abstract

This article describes capital spending patterns for general purpose local governments in 36 large U.S. metropolitan areas for the period from 1987 to 1991. Capital spending by central cities dominates metropolitan area expenditures in each year. The results suggest that at least for local capital spending, central city residents provide the bulk of funds devoted to metropolitan area infrastructure provision. The primary reasons for this dominance are that city governments spend more than suburbs overall, and their spending is more heavily weighted toward capital in the most capital-intensive functions. City spending is not more concentrated in heavily capital-intensive functions. Highway and sewer aid from other levels of government favors cities but does not fully compensate them for the greater capital spending they undertake.