Therese McGuire

Professor of Management and Strategy
ConAgra Foods Research Professor
Kellogg School of Management
Faculty Fellow, Institute for Policy Research
Northwestern University
Ph.D., Economics, Princeton University
therese-mcguire@northwestern.edu
Curriculum Vitae

Therese McGuire's areas of expertise include state and local public finance, fiscal decentralization, property tax limitations, education finance, and regional economic development. She has written about and advised various governments on state tax reform and on the impact of taxes on economic growth. Prior to joining the Northwestern faculty, McGuire was a professor in the College of Urban Planning and Public Affairs at the University of Illinois at Chicago, and associate director of the university's Institute of Government and Public Affairs. In 1989, McGuire worked with a blue-ribbon commission and directed a study of revenues and expenditures for the State of Arizona. She was president of the National Tax Association in 1999-2000, as well as the editor of the NTA's academic journal, the National Tax Journal from 2001 until 2009. Her recent publications have appeared in the National Tax Journal, Brookings-Wharton Papers on Urban Affairs, the Journal of Regional Science, and International Tax and Public Finance.

Current Research

Fiscal Decentralization and Solidarity. Classic treatments of fiscal federalism (Oates, 1972) place the responsibility for delivery of goods and services exhibiting bounded geographic reach and limited economies of scale in the purview of local governments. We explore the implications for the optimal degree of fiscal decentralization when these same goods and services reflect people's preferences for specific egalitarianism (Tobin, 1970) or what we call solidarity. We find that a system in which the central government provides a common minimum level of the publicly provided good and local governments are allowed to use their own resources to provide an even higher local level performs better from an efficiency perspective relative to all other systems analyzed and for a wide range of preferences over solidarity.

Productivity Spillovers of Headquarter Firms. McGuire has begun an empirical follow-up to her theoretical study of tax incentives and business location decisions that appeared in the 2002 volume of Brookings-Wharton Papers on Urban Affairs. She and her co-authors are utilizing confidential Census microdata on business services firms and headquarter firms to test for the presence of agglomeration economies (in particular, knowledge spillovers) in urban areas. They are interested in whether the productivity of business services firms is affected by the presence of headquarters firms in the same metropolitan area.

Selected Publications

Articles and Chapters

"Growth and variability of state individual income and general sales taxes," with Richard F. Dye, National Tax Journal, Vol. 44, No. 1, March 1991.

"The contribution of publicly provided inputs to states' economies," with Teresa Garcia-Milà, Regional Science and Urban Economics, Vol. 22, No. 2, June 1992.

"The effect of property tax limitation measures on local government fiscal behavior," with Richard F. Dye, Journal of Public Economics, Vol. 66, 1997.

"Intergovernmental fiscal relations and social welfare policy," Intergovernmental Fiscal Relations: Perspectives and Prospects, edited by Ronald C. Fisher, Kluwer Academic Publishers, Norwell, Massachusetts, 1997.

"Do limits matter? Evidence on the effects of tax limitations on student performance," with Thomas A. Downes and Richard F. Dye, Journal of Urban Economics, Vol. 43, 1998.

"A note on the shift to a service-based economy and the consequences for regional growth," with Teresa Garcia-Milà, Journal of Regional Science, Vol. 38, No. 2, May 1998.

"Proposition 13 and its offspring: for good or for evil?" National Tax Journal, Vol. 52, No. 1, March 1999.

"The influence of taxes on employment and population growth: evidence from the Washington D.C. metropolitan area," with Stephen T. Mark and Leslie E. Papke, National Tax Journal, Vol. LIII, No. 1, March 2000.

"Alternatives to property taxation for local government," Property Taxation and Local Government Finance, edited by Wallace E. Oates, Lincoln Institute of Land Policy, Cambridge, Massachusetts, 2001.

"Tax incentives and the city," with Teresa Garcia-Mila. In William G. Gale and Janet Rothenberg Peck (eds.). Brookings-Wharton Papers on Urban Affairs, 2002.

"State spending on social assistance programs over the business cycle," with David F. Merriman. In Working and Poor: How Economic and Policy Changes Are Affecting Low-Wage Workers, edited by Rebecca M. Blank, Sheldon H. Danziger and Robert F. Schoeni, Russell Sage Foundation, New York, New York, 2006.

"The local funding of schools: the property tax and its alternatives," with Leslie E. Papke. In Handbook of Research in Education Finance and Policy, edited by Helen F. Ladd and Edward B. Fiske, American Education Finance Association, 2008.