Stark: Taxation, Redistribution, and the Urban-Rural Divide
In Taxation, Redistribution, and the Urban-Rural Divide, Kirk J. Stark (UCLA School of Law) considers how population density in urban and rural areas influences subnational and nation tax policies in the United States. The author claims that the urban-rural divide promotes more redistributive tax policies at the subnational level, while pushing the national government towards less redistributive tax policies.
A redistributive tax system is a system in which the funds obtained from taxes are distributed to another individual. A prime example of this is the United States income tax, where high-income earners pay a higher percentage of their income than low-income earners. The revenue from the income tax is then used for social programs that benefit low-income earners to reduce inequality. This is also called a progressive tax. On the other hand, an example of a non-redistributive tax, also known as a regressive tax, would be a uniform property tax where each property is taxed the same amount, regardless of property value.
Stark uses data from the US Census Bureau, an “effective tax rate” measure from the Tax Foundation, and the “Tax Inequality Index” by the Institute on Taxation and Economic Policy to examine the progressivity of each state and local tax. This data reflects a trend where large urban centers, which tend to be politically progressive, have redistributive tax policies.
The trend of redistributive tax policies at a subnation level compared to nation level can be attributed to the US election system. When creating federal elections, the Founding Fathers sought to protect state interest because they did not want a populous state to dominate smaller states. This resulted in multiple mechanisms, including the electoral college. This creates a system where densely populated progressive bubbles (large cities) can influence subnational politics to a greater extent than national politics. Hence, at the national level, where rural voters have more influence, the redistributive tax policies are disfavored.
The urban-rural divide with our current electoral systems influences tax policies at all levels of government. Stark encourages scholars to examine how the popularity of remote work, which allows urban areas to experience a decrease in population density, will influence the urban-rural divide and therefore national tax policies.
For more about this article, see Adam Thimmesch, The Asymmetric State: The Urban-Rural Divide as Architect of U.S. Tax Policy, JOTWELL (March 11, 2026). https://tax.jotwell.com/the-asymmetric-state-the-urban-rural-divide-as-architect-of-u-s-tax-policy/.
