About

Stephen Coate is the Kiplinger Professor of Public Policy at Cornell University. His professional affiliation is with the Department of Economics at Cornell, where he is involved in public economics. His contact information includes an office at 476 Uris Hall, Ithaca, NY, and email sc163@cornell.edu. The webpage indicates his role and title but does not provide additional details about his research focus, background, or key contributions.

Research topics

• Public economics
• Microeconomics
• Economics
• Finance
• Business
• Market economy
• Economic growth
• Law
• Macroeconomics

Selected publications

• An efficiency case for equity-based school priorities

  Journal of Public Economics · 2025-09-11

  articleOpen accessSenior author

  Many school districts operate “school choice" or “open enrollment" programs that give parents a choice of school. The popular schools in these districts are often oversubscribed, so districts must decide which applicants receive priority at these schools. Typically, districts give priority to students who live close to these schools or allocate by random lottery. However, to provide more equitable access to popular schools and to reduce school segregation, some districts prioritize students based on socio-economic status (e.g., favoring students from less-affluent neighborhoods). This paper shows that, despite their effects on transportation costs, these equity-based priorities can increase efficiency in the sense of raising aggregate welfare. They do this by facilitating better matches of students to schools. • Many school districts operate “school choice” or “open enrollment” programs that give parents a choice of school. • The popular schools in these districts are often oversubscribed, so districts must decide which students receive priority at them. • We show that prioritizing students based on socio-economic status (e.g., favoring students from less-affluent neighborhoods) can be efficient.

  PublisherDOI

• Financing local public projects

  Regional Science and Urban Economics · 2023 · 7 citations

  Senior authorCorresponding
  • Economics
  • Public economics
  • Finance
  PublisherDOI

• Community development with externalities and corrective taxation

  Journal of Economic Geography · 2021 · 4 citations

  Senior authorCorresponding
  • Economics
  • Public economics
  • Microeconomics

  Abstract This paper studies the impact of granting a community the authority to tax development when growth imposes negative externalities on existing residents. Taxes are chosen in each period by the residents who are fully forward-looking. Residents’ policy choices reflect not only the desire to counter negative externalities but also their wish to raise tax revenues and the value of their homes. There exists an equilibrium in which taxes are gradually lowered to close to optimal levels, resulting in falling housing prices and increasing community size. In addition, there exist equilibria in which taxes are set much too high and development is permanently stalled. In these equilibria, residents anticipate that lowering taxes will cause a sharp fall in the value of their homes. This multiplicity of equilibrium means that, for a broad range of initial conditions, allowing residents to tax development can increase or decrease social welfare. Regulating growth with zoning generates even worse outcomes, but allowing the community to charge developers impact fees does better.

  PublisherDOI

• Community development by public wealth accumulation

  Journal of Urban Economics · 2020 · 6 citations

  Senior authorCorresponding
  • Economics
  • Market economy
  • Public economics
  PublisherDOI

• Peer Preferences, School Competition, and the Effects of Public School Choice

  American Economic Journal Economic Policy · 2019-11-01 · 18 citations

  articleOpen accessSenior author

  This paper develops a new economic model of public school choice. The key innovation is to model competition between schools in an environment in which parents have peer preferences. The analysis yields three main findings. First, peer preferences dampen schools’ incentives to exert effort in response to competitive pressure. Second, when peer preferences are sufficiently strong, choice can reduce social welfare. This is because choice is costly to exercise but aggregate peer quality is fixed. Third, given strong peer preferences, choice can reduce school quality in more affluent neighborhoods. We conclude that peer preferences weaken the case for choice. (JEL H73, H75, I21, I28, R23)

  PublisherOA PDFDOI

• Optimal fiscal limits with overrides

  Journal of Public Economics · 2019-05-09 · 13 citations

  article1st author
  PublisherDOI

• On the Dynamics of Community Development

  National Bureau of Economic Research · 2017-08-01 · 3 citations

  reportOpen accessSenior author

  This paper presents a dynamic political economy model of community development. In each period, a community invests in a local public good. The community can grow, with new housing supplied by competitive developers. To finance investment, the community can tax residents and issue debt. In each period, fiscal decisions are made by current residents. The community's initial wealth (the value of its stock of public good less its debt) determines how it develops. High initial wealth leads to rapid development. Low initial wealth leads to gradual development that is fueled by community wealth accumulation. Wealth accumulation arises from the desire to attract more households to share the costs of the public good. The long run size of the community can be too large or too small and development may proceed too slowly. Nonetheless, some development occurs and, at all times, public good provision is efficient.

  PublisherOA PDFDOI

• EVALUATING THE SOCIAL OPTIMALITY OF DURABLE PUBLIC GOOD PROVISION USING THE HOUSING PRICE RESPONSE TO PUBLIC INVESTMENT

  International Economic Review · 2017-02-01 · 11 citations

  article1st authorCorresponding

  Recent empirical work in public finance uses the housing price response to public investment to assess the efficiency of local durable public good provision. This article explores the theoretical justification for this technique. It points out that the logic justifying the technique for evaluating nondurable public good provision does not translate to the durable case. A model in which investment is determined by the interaction between a budget‐maximizing bureaucrat and a community's residents is used to demonstrate that the technique can falsely predict underprovision, falsely predict overprovision, or perform without error.

  PublisherDOI

• On the Dynamics of Community Development

  National Bureau of Economic Research · 2017-01-01

  articleSenior author

  This paper presents a dynamic political economy model of community development. In each period, a community invests in a local public good. The community can grow, with new housing supplied by competitive developers. To finance investment, the community can tax residents and issue debt. In each period, fiscal decisions are made by current residents. The community's initial wealth (the value of its stock of public good less its debt) determines how it develops. High initial wealth leads to rapid development. Low initial wealth leads to gradual development that is fueled by community wealth accumulation. Wealth accumulation arises from the desire to attract more households to share the costs of the public good. The long run size of the community can be too large or too small and development may proceed too slowly. Nonetheless, some development occurs and, at all times, public good provision is efficient.

  Publisher

• Regímenes políticos. Orígenes y efectos

  CAF eBooks · 2016-09-01

  book
  Publisher

Frequent coauthors

• Timothy Besley

  London School of Economics and Political Science

  49 shared

• Marco Battaglini

  47 shared

• Brian Knight

  Brown University

  30 shared

• Levon Barseghyan

  Cornell University

  21 shared

• Damon Clark

  University of California, Irvine

  13 shared

• Timothy Besley

  London School of Economics and Political Science

  10 shared

• Glenn C. Loury

  Brown University

  8 shared

• Michael Conlin

  Michigan State University

  8 shared

Awards & honors

• Fellow of the American Academy of Arts and Sciences (2017)
• Fellow of the Econometric Society (2004)