A Capitalization Approach to Fiscal Incidence at the Local Level.

This paper argues that an analysis of the capitalized burdens and benefits of the local public sector offers a simple, straightforward and objective computational methodology to fiscal incidence at the local level. This capitalization approach represents a major departure from the highly discretionary and imprecise computational environment of the "reasonable assumptions" and Aaron and McGuire approaches. It is initially discussed both from conceptual and operational points of view and then implemented using alternate procedures. Major limitations of the approach are then noted. A comparative perspective on fiscal incidence results based on the capitalization approach and of earlier studies on this subject is provided in the concluding section of the paper. [ABSTRACT FROM AUTHOR]