Capitalization of property taxation and transportation improvements in Orange County, California

Using spatial autoregressive modeling of housing data for Orange County, CA, this dissertation examines capitalization of several major events, including some of their expectations, into dwelling prices. The first event that affected dwelling prices in Orange County, CA is the passage of Proposition 13. The second event is the proposal and expectation of toll roads. The third event is the expectations of a commercial airport at El Toro. This study also evaluates the differential burdens of property tax across basic US Census categories in Orange County. CA. The modeling emphasizes location by addressing spatial correlation through the inclusion of spatially lagged dependent variables. By using spatial autoregressive methodology, this study more robustly confirms the capitalization of the decrease in property taxes with the passage of Proposition 13. This study also presents a positive impact of toll roads and a negative impact due to airport expectation. Finally this dissertation finds horizontal and vertical inequity of property taxes and a regressive property tax structure.