Tax Rates Research Paper

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Gor Sargsyan
Political Partisanship in the Tax Rates of Vermont
Introduction:
Why do certain societies adopt different policies than others? Much of the literature on
political outcomes in the United States argues that partisanship is prominent among the
numerous causes to the policies adopted in any given state. Each work encompasses its own view
of the bigger picture, and though some argue that gender differences (Zipp and Plutzer 1985) and
socioeconomic factors (Fritz 1982) are important, studies also emphasize the importance of a
society’s aggregate partisan identity. I argue that political partisanship is the primary cause of tax
rate changes. To study this hypothesis I will examine the role of partisanship on tax rate
decisions made in town meetings in Vermont. In Vermont, partisanship has been born and
nurtured within the town meetings, and the source of influence on voting outcome is from the
groups of people in the meetings. In the sections that follow I outline a research design to
compare the evidence gathered in Vermont and assess which factors influence policy outcomes
in town meetings.
Voter turnout is based on countless factors that shape the general politics of our nation.
One main factor, most people will agree with, is population. In California, for example, the
percentage of people who vote in the presidential elections every year is less than half of the total
population. This means that the elected candidate, or chosen policy, is supported by the majority
vote of a minority group. This, in turn, creates doubt in the policy choices and sparks curiosity in
questioning the legitimacy of our governments. Yet, surprisingly, there is little known fact about
the nature of our government system and whether it should be changed. In this paper, I will

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present a case study of the state of Vermont, emphasizing the presence of voter biases and how
the political partisanship within town meetings affects tax rates.
The significance of the subject of political partisanship as an influence in policymaking
lies in its providing of information that aids in the examination of our voting system, how clearly
our voting system represents the true voice of the people, and what exactly influences its
outcome in the results of policy decisions. This essentially affects how individuals, like you and
me, run our daily lives. As Gerber and Huber show in their article “Partisanship and Economic
Behavior - Do Partisan Differences in Economic Forecasts Predict Real Economic Behavior?”
the political party in control, which has a large influence on policy decisions, affects consumer
habits. Gerber and Huber explain that consumers change their habits of living and spending
based on the policies that they “predict” or “expect” that the new candidate will impose. The
expected outcomes are with respect to the winning candidate’s political views, and economic
plans for the duration of his term. Whether the candidate is a Democrat, a Republican, a liberal
or a conservative, consumers already have an idea of future changes to be implemented and
thereby adjust their lifestyles to future policies ahead of time. Examining partisanship as a cause,
in our government could also explain holes in our system and offer better, more effective, insight
on managing our government, not only in Vermont, but the rest of the US. The acting influence
in Vermont’s town meetings is applicable to larger populations as well, because population size
has little to no effect on the partisanship of a select community.
From the data collected on the 247 towns in Vermont from the 1970’s to the present, I
have discovered a strong pattern between tax rates and political affiliation of the towns. After
running tests on the relationship of partisanship and tax rates I concluded that tax rates, the
dependent variable, are directly correlated with partisanship, the independent variable. As

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partisanship toward a Democratic party increases the tax rates increase, and in the same manner,
as Republican partisanship increases, tax rates decrease. This pattern is expected in most
Democratic systems of governments, and Vermont is a case study of this phenomenon.
A democracy is a system of government based on the consent of the governed. A
democratic government emphasizes the constitutional equality of each citizen in the decision
making process. In most of the country, elections provide citizens with an opportunity to
influence public policy. Usually, states tend to hold public election through the use of secret
ballots or by mail. In this way, anonymous public opinions are collected and voiced as a majority
decision and policy is created. However, not all states have the same voting procedures, and not
all towns hold annual town meetings to determine local policy. This makes us question the
accuracy and reliability of the final decision as it relates to public opinion, and the method of
collecting votes subject to possible variables influencing the voice of a majority.
In Vermont town meetings, locals decide these issues. The voting outcomes for elections
of state and federal officials appear to correlate with the amount of tax imposed in the town
meeting. Simply put, political partisanship at the voting booth should match the local policy
choices taken in town meetings. I expect that towns voting for Democrats will have higher taxes
and towns electing Republican parties will have lower tax rates. The focus of this paper will be
the change in tax rates specifically as it relates to a town’s election voting outcomes. Some
Deliberative Democracy scholars argue for example, that in a well-connected network of
discussion, like those of town meetings, partisan attitudes will harmonize, having provided
people with a unique setting of interaction. Stemming from the polarization of a network of
agreement within a town meeting, the gradual emotional attachment to specific candidates form
with disregard to logical decision-making based on factual information (Parsons 2010).

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However, the tax rates in the towns of Vermont should still be relevant and proportional to the
voting partisanship of the individual. Do towns with higher tax rates tend to vote for democratic
candidates while towns with lower tax rates have Republican Party leaders? This question can
best be answered through data analysis of past presidential elections, used to determine political
orientation of Vermont towns, while keeping track of the tax rates established during the terms
of presidency. The collected election data from 1970 to 2012 will show us each town’s partisan
affiliation based on their vote for either the Democratic or Republican Party candidate. In
accordance, the data on tax rates will show us any patterns of proportionality to partisanship as it
changes, and to the extent that it changes, in each town.
Literature Review:
Group identity affects attitudes and behavior of individuals. This effect is equally and
actively present in political environments. The article “Party Affiliation, Partisanship, and
Political Beliefs” provides answers to the question of external influences acting upon voter
turnout in elections. Gerber and his coauthors discuss the connection that exists between voters’
political affiliations, and the decisions that the voters will make on Election Day. In particular,
Gerber suggests that there is a direct correlation between partisanship and voting turnout based
on a controlled experiment conducted by him for the first time. The subject in this case is the
state of Connecticut in comparison to Vermont. Unlike Vermont, Connecticut does not allow
citizens to vote unless they claim an affiliation toward a specified political party. There were two
groups of subjects in the experiment: the treatment group, in which the researchers intervened,
and a control group in which the researchers had no influence in pushing them to choose a
direction. The experiment, in regards to this, was conducted with a group of randomly selected

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registered voters who claimed to be neutral. These registered voters were given a pre-survey
before the election without requiring voters to choose a political affiliation: the survey was
examined for tendencies toward a certain party. Before the election, each person was sent a letter
reminding them that they must choose a political party in order to be eligible to vote in the actual
election; most chose the party that they had shown tendencies toward on the pre-survey. When it
was time for the actual election, researchers took note of the changes in this same group of
people. When they chose a political party there was an increase in partisan identification. “Our
findings support the theoretical argument that partisanship is a group identity that induces
individuals to evaluate members of their group more favorably than members of opposing (party)
groups” (742). In this same way, I hypothesize that Vermont elections should show similar
partisan influence on the voters’ choices. Of course, partisanship does not imply citizen
participation in active politics, it simply points out the bias in voting behavior based on
individual preconceived notions and judgments.
Much of the existing literature emphasizes that partisanship is in fact a major component
in public policy. At least three conclusions, validating the strong presence of the influence of
partisanship in a community, can be drawn from the existing theories:
1: Partisanship has a strong effect on political and economic behaviors and attitudes.
2: Party affiliation is an underlying factor in candidate choice.
3: A citizen’s partisan identity toward a political party reflects their economic decisions.

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Gerber has written a complementary article coauthored with others, called “Partisanship
and Economic Behavior.” He continues to support the idea of partisanship having a significant
role in elections, and extends those results to economic changes in consumer behavior. “There is
ample evidence linking partisanship to candidate choice and political participation” (Gerber and
Huber 2009, 423). Their studies have shown that before and during the election period, consumer
habits differ. The assumption is that consumers predict forthcoming economic policies based on
the likelihood of a candidate winning, and the actions they will take in reform of the system. This
study is less focused on a single state, however, and more focused on “mass politics.” “Citizens
appear to be adjusting their consumption based on expected income rather than today’s income”
(Gerber and Huber 2009, 424). When citizens expect a Democratic candidate to be elected and
thereby, raise taxes, they would cut down spending and save more in preparation, while the
opposite trends displayed dominance for a Republican candidate. In an expected similar case,
Vermont generates higher tax rates under Democratic leadership and lower tax rates in a
Republican government. Gerber points out some faults in his claim, clarifying that consumption
could take place by consumers from nearby counties that are of different political affiliations,
altering the survey results. That will be discussed in greater detail, however the conclusion
remains consistent that partisanship influences political outcomes. The partisanship in Gerber’s
argument lies in expected economic policy change that conducts political adjustments in the lives
of citizens, hence influencing their political decisions. This same type of partisanship leads me to
my research in its effects on decision-making in Vermont town meetings.
These town meetings have developed as a system of government, which Bryan
juxtaposes with the Democracy of the pre-modern world, over twenty-five hundred years ago, in
Athens, Greece. He calls this system a “real democracy” (Bryan 4, 2004), and in comparison,

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argues that Vermont has kept its roots as a “real democracy” and most people are not even aware
of this. A “real democracy” is a jurisdiction in which all of its people are citizens and eligible to
participate in its politics. In Athens, those who were not citizens still abided by the laws. The
high taxes in place for the citizens of Athens also applied to non-citizens that were nonetheless
taxed equally, but did not receive the services and benefits as citizens. In the same way, Vermont
uses this tactic to its advantage. Fritz points out that this method of taxing non-citizens, or
tourists, was taken advantage of by Vermont as a monetary alternative to reduce the burden on
residential property tax (Fritz 382, 1982). Athens also manipulated agendas, as do towns in
Vermont. Items that may face opposition are placed at the end of the list so that minority groups,
such as farmers, would have to go home to milk, and, near the end, be underrepresented when
the agenda is called to a vote. In this sense, Bryan calls Vermont a “real democracy,” saying that
it comes with the bad and the good, but the bottom line is that a “real democracy” is not partial.
Every individual in a town makes the laws for themselves, and the officials don’t have much
power over them.
Theory and Hypotheses:
. Many questions arise when considering the development and strategy of a town’s tax
rate. Whether tax rates are based off of mutual feelings among policy-making groups or they are
based on strategic decision-making, there is reasoning behind every action in politics. Scholars
offer differing and, at times, controversial explanations for political outcomes in the state and its
towns. Based on collected evidence from historic records of over 240 towns in the state of
Vermont, I have gathered enough analytical data to offer a data-based argument on the cause of
state taxes and what external factors affect them. I also distinguish how these methods differ

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from those of others. Decisions in politics are extremely complicated and require more than
pattern analysis because of the role of human nature in government. The biases that are born
from human environments may act as a valid explanation as to why policies are as they are. In
terms of tax rates in Vermont, I argue that partisanship plays a major role in the direction of
public policy, and its effects are strongly felt in Vermont. Local tax rate decisions are made in an
annual decision-making body consisting of eligible voters who choose to attend the annual town
There is a direct correlation between the levels of partisanship in any given democratic system as
it relates to the amount of tax rate imposed in that region.
This leads me to hypothesize the following:
H1: Partisanship has a direct effect on the imposed tax rates of a town in Vermont.
H2: If partisan identification favors the Republican Party, then tax rates are expected to be
lower.
H3: The higher the partisan majority in a town, the greater is the effect on the shift of tax rates
from the state average.
Even though partisanship is the main cause of differences in tax rates across Vermont
towns, there may also be other variables that affect partisanship and tax rates indirectly. There
are additional hypotheses that could also be factors in the tax rate decision process. These
alternative hypotheses give more insight as to how further influences may have an impact on
partisanship in Vermont.

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H4: Partisanship may be directly or indirectly affected by external socioeconomic factors like
tourism, and urbanization in select Vermont towns, which in turn affect the tax rate.
H5: Variable income levels, and population size are the root causes to variance in partisan
identity in a town, which in turn affect the tax rate.
Each of the hypotheses can be tested with a common method. Since there is a mass of collected
data on town meetings, voting rules, tax rates and political affiliation in each of the towns in
Vermont, the simple method is to use regression analysis to compare the relative influence of
each of the independent variables on the dependent tax rate outcome. This method offers a
repeatable test of the various hypotheses. In order to test these hypotheses we must first explore
the relationship across towns between tax rates and partisanship. To observe this relationship, I
have collected data from the state archives of Vermont for each individual town. As I run
statistical analyses of the data, I anticipate finding a correlation to form between partisanship and
tax rates. A measure of higher Republican partisanship should correlate with lower tax rates, and
to the same extent a measure of higher Democratic partisanship with higher tax rates.
Comparable statistics would be a collection of ratios of democratic towns to republican towns
that would lead to aggregate tax rates over time. To run the tests and prove the hypotheses I
coded the data from the 1970s to the present, on Democrat or Republican votes in the
presidential elections, total tax rates, school tax rates, population, population under 18, and
annual wage. I first tested the relationship between tax rates and partisanship. From this we can
determine what exactly occurs as average partisanship in Vermont increases, so to say

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partisanship in Vermont goes from least democratic, or highest republican, to highest democratic
level. I then evaluated the strength of this relationship by incorporating additional variables in
the statistical test. To do this I tested the same dependent variable, total tax rate, with different
independent variables such as population. From that, I examined the degree of partisan
orientation in each town by measuring the percent Democrat and percent Republican as it relates
to the total tax. Also, I measured the total tax rate in the same time period as the towns
experienced an increase in tourism to compare with the partisanship during its neutral economic
state.
Evidence:
The following visuals are a collection of statistical data to show the relationship between
partisanship and tax rates as well as to disprove possible alternate hypotheses relevant to the
data. As we examine the figures, it is important to note that the main figures in these tables are
the coefficient, the t-test and the p-value of the test. These figures will clarify the relationship
and its strength between the tested independent and dependent variables.
In the summary analysis of Figure 1, we can see information on all of the variables that
are involved in this project. Each section of the independent variables will be discussed
individually to isolate results for clarity and accuracy.

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FIGURE 1: Vermont summary analysis:
.
popden 8574 189.573 519.36 0 5111.092
population 8610 2495.643 4106.259 0 42645
totaltax 6062 2.773971 2.01754 0 24.89
schooltax 9132 1.713645 1.272047 0 21.89
republican 8836 .4635177 .1183995 0 .96875
democrat 8836 .5364823 .1183995 .03125 1
p_over65 2766 .1281443 .0546335 0 .7142857
p_under18 2766 .2644183 .0450244 0 .4836065
p_white 2766 .9867098 .011972 .9012433 1
p_black 2766 .0026792 .0028974 0 .0226572
p_asian 2766 .0038599 .0046614 0 .0539552
p_nativeam 2766 .0034355 .0049408 0 .0517492
percapitai~e 5676 12255.16 5393.124 3072 37210
medianhous~e 5181 28211.32 9790.703 5345 68091
familypove~d 2805 39.27255 71.13499 0 798
annualwage 6868 17779.01 7661.138 2751 109928
area 8864 32.04243 15.08086 1.430614 73.00948
tcode 9461 8185.179 4326.449 1003 14786
schdid 9461 133.2821 75.42402 1 263
county 0
year 9461 1994.507 10.41992 1976 2012
townname 0
Variable Obs Mean Std. Dev. Min Max

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FIGURE 2: Ratio of Political Parties
We can see in our first piece of evidence that already, the percentage of Democrats in
Vermont overwhelms the percentage of Republicans. According to our summary analysis table,
this ratio is by 54% to 46%. This tells us the partisan identity of the Vermont state as a whole. To
continue the tests, we must place this into perspective. Knowing that Vermont is a Democratic
state, we are able to make assumptions, which we will test with the following evidence.
democrat
republican
democrat republican
Ratio of Partisan Majority in Vermont

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FIGURE 3: Change in total tax over time.
Our argument is that total tax tends to increase as partisanship increases. Knowing that
Vermont, on average, is a Democratic state, we observe that over time its total taxes, in blue,
have been dropping. Though this may be unusual based on our expectations of Democrats having
higher taxes, it is not unlikely. We can see that the total tax is dropping, however, if we take a
closer look, there is a fine definition between the two lines. The blue line, Democratic, though
intertwined with the red line, Republican, at the initial stages of our sample size, for any
multitude of reasons, it is not below the red line. The tax rates for Democratic towns have
decreased at a lower rate than the tax rates for Republican towns. After around 1980s or so, they
flatten out. The area of intertwined relations in the 1970s to 1980s, as displayed on the graph, is a
simple deviation from its original trend. To exemplify, a soccer team who follows a trend of
winning, receives a goal from the opposing team at some point in time. The soccer team that is
continuously winning is the trend of Democratic towns continuously having higher tax rates than
2468
Totaltax
1975 1980 1985 1990 1995 2000
Year
Democratic Republican
Tax Rates of Democratic vs. Republican Towns

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Republican towns. The winning soccer team getting scored on by the opposing team is an
unlikely event considered to be a deviation from the norm of the soccer team’s trends. Similarly,
Democratic towns having lower taxes than Republican towns is a deviation from the usual tend
of tax rate proportions. In retrospect, human nature is a factor in the unexplainable shifts from
developing patterns. However, one explanation can be found in the following table.
FIGURE 4: School tax rates over time
School tax makes up a large portion of the total tax because it is a major source of revenue for
the government. We can also conclude this from the R-squared variable measured at 0.1713,
considering that it is a high value, and shows a strong relationship. Therefore, as a contributing
explanation to the intertwined portion of the above graph, it is worth mentioning that between the
1970’s and 1980’s, there was a dip in school tax rates at one point due to state court rule on how
schools were funded. This decrease in school tax rate also decreased the total tax rate, and the
significant difference is visible in the visual above. Of course, it is very likely that there may be
other contributions as to why the trend is slightly inconsistent in that period of time. However, as
_cons 124.729 4.98375 25.03 0.000 114.9592 134.4988
year -.0618619 .0025204 -24.54 0.000 -.0668028 -.056921
popden -.0001036 .0000316 -3.28 0.001 -.0001656 -.0000416
population 9.48e-06 3.80e-06 2.49 0.013 2.02e-06 .0000169
democrattown .2099147 .02797 7.50 0.000 .1550842 .2647451
annualwage 4.32e-06 2.57e-06 1.68 0.092 -7.11e-07 9.36e-06
area -.0002577 .0008913 -0.29 0.773 -.002005 .0014896
schooltax Coef. Std. Err. t P>|t| [95% Conf. Interval]
Total 6965.0016 6496 1.07219852 Root MSE = .94308
Adj R-squared = 0.1705
Residual 5772.2053 6490 .889399892 R-squared = 0.1713
Model 1192.7963 6 198.799383 Prob > F = 0.0000
F( 6, 6490) = 223.52
Source SS df MS Number of obs = 6497

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part of the big picture, we see that the average trend of school tax rates increases as democratic
partisanship increases, based on the coefficient of the variable “democrattown,” and its P-value
of less than 0.05 for confidence in our calculation.
FIGURE 5: Partisanship over time
Complimenting Figure 3 and 4, this graph shows the percent of each town that identifies
as Democrat over time. We can see the growth of Democrat over time, along with an average
linear approximation to simplify the graph. As you can see, there are outliers present in our data.
These outliers are more present in smaller towns, which I classify as having a population of less
than 1000 people. The noise level in these towns is much greater than large towns, possibly due
to popular influence in town meetings of certain towns, or simply because some towns very
0
.2.4.6.8
1
democrat
1980 1990 2000 2010
year
Growth democrat
Average growth
Democratic Partisanship Over Time

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strongly identify with one party or another. However, the general trend is the gradual increase of
democratic party affiliation over time.
FIGURE 6: Regression analysis of democrat to total tax.
This figure is also a continuation of evidence from figure 3 and 4. Based on the graph,
this table explains the detailed structure of what was happening. As I previously explained, the
Democrat and Republican values were both decreasing. However, Democrat was decreasing at a
_cons 321.6079 12.06994 26.65 0.000 297.9456 345.2702
2000 0 (omitted)
1999 -.3506705 .1107308 -3.17 0.002 -.5677504 -.1335907
1998 -.5361313 .1088028 -4.93 0.000 -.7494313 -.3228313
1997 -.7472018 .107497 -6.95 0.000 -.9579419 -.5364616
1996 -.9526746 .1065895 -8.94 0.000 -1.161636 -.7437135
1995 -1.206911 .1047563 -11.52 0.000 -1.412278 -1.001543
1994 -1.369321 .1031753 -13.27 0.000 -1.571589 -1.167054
1993 -1.580963 .1015683 -15.57 0.000 -1.78008 -1.381846
1992 -1.661785 .1007334 -16.50 0.000 -1.859266 -1.464304
1991 -1.608861 .0991067 -16.23 0.000 -1.803153 -1.414569
1990 -1.597226 .0995798 -16.04 0.000 -1.792445 -1.402007
1989 -1.689232 .0997527 -16.93 0.000 -1.88479 -1.493674
1988 -1.865114 .0999403 -18.66 0.000 -2.06104 -1.669188
1987 -2.021748 .101247 -19.97 0.000 -2.220235 -1.82326
1986 -2.191923 .1028396 -21.31 0.000 -2.393533 -1.990313
1985 -2.361502 .1049144 -22.51 0.000 -2.567179 -2.155825
1984 -1.977939 .1075425 -18.39 0.000 -2.188768 -1.767109
1983 -1.808346 .1085497 -16.66 0.000 -2.02115 -1.595542
1982 -1.663901 .1101053 -15.11 0.000 -1.879754 -1.448047
1981 -1.571632 .1119582 -14.04 0.000 -1.791118 -1.352146
1980 -.9854743 .1156357 -8.52 0.000 -1.21217 -.7587787
year
year -.1599524 .0060842 -26.29 0.000 -.1718799 -.1480248
popden -.0000874 .000046 -1.90 0.057 -.0001776 2.75e-06
population .0000358 5.37e-06 6.66 0.000 .0000252 .0000463
democrat 1.226576 .2272842 5.40 0.000 .7810013 1.67215
annualwage -8.26e-06 4.45e-06 -1.86 0.063 -.000017 4.60e-07
area -.0022655 .001319 -1.72 0.086 -.0048514 .0003203
totaltax Coef. Std. Err. t P>|t| [95% Conf. Interval]
Total 12184.2432 5134 2.37324565 Root MSE = 1.2286
Residual 7710.29059 5108 1.50945391 R-squared = 0.3672
Model 4473.95259 26 172.0751 Prob > F = 0.0000
F( 26, 5108) = 114.00
note: 2000.year omitted because of collinearity

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lower proportional rate than Republican. Therefore, Democratic towns still had higher taxes than
Republican towns. As we can see on the table, the democrat variable has a positive coefficient
showing growth, and a P-Value of below 0.05, and T-test of above 1.96, meaning that the
generated statistic is at a very high confidence rate in its accuracy.
FIGURE 7: Regression summary.
As I mentioned before, to prove the accuracy of our testing for partisanship, I include
multiple variables to show their counteracting affects and act as alternative hypotheses to
disprove our hypotheses. As we can see, most of these variables have very low significance at a
very high confidence rate. Also, population as a single factor alone, seems to have close to zero
effect on total tax as its coefficient is nearly zero with a P-Value of below 0.05. However, we
continue to see the variable Democrat with a high coefficient showing growth and confidence in
the accuracy of that growth in total tax as partisanship increases.
_cons 248.3034 16.95446 14.65 0.000 214.9056 281.7013
year -.1240887 .0085768 -14.47 0.000 -.1409838 -.1071936
popden -.0001063 .0000755 -1.41 0.160 -.0002549 .0000424
population .0000336 6.95e-06 4.83 0.000 .0000199 .0000472
democrat 2.454509 .4861244 5.05 0.000 1.496914 3.412104
annualwage -.0000114 9.38e-06 -1.21 0.226 -.0000299 7.09e-06
area -.0010311 .0032293 -0.32 0.750 -.0073923 .0053301
Robust
(Std. Err. adjusted for 242 clusters in townname)
Root MSE = 1.3555
R-squared = 0.2266
Prob > F = 0.0000
F( 6, 241) = 75.42
Linear regression Number of obs = 5135

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FIGURE 8: Regression analysis: influence of population
To go into detail on population, this regression analysis is a comparison of towns with
more and less than 1000 people. To classify small towns and large towns, I use population size
.
_cons 386.2727 11.63407 33.20 0.000 363.4588 409.0866
year -.1916498 .0058188 -32.94 0.000 -.2030602 -.1802394
republican -4.893252 .337947 -14.48 0.000 -5.555952 -4.230552
Total 11422.2681 2390 4.77919167 Root MSE = 1.8118
Model 3583.54304 2 1791.77152 Prob > F = 0.0000
F( 2, 2388) = 545.85
. regress totaltax republican year if population<1000
_cons 381.3795 11.51041 33.13 0.000 358.808 403.9509
year -.1916498 .0058188 -32.94 0.000 -.2030602 -.1802394
democrat 4.893252 .337947 14.48 0.000 4.230552 5.555952
Total 11422.2681 2390 4.77919167 Root MSE = 1.8118
Model 3583.54303 2 1791.77152 Prob > F = 0.0000
F( 2, 2388) = 545.85
. regress totaltax democrat year if population<1000
_cons 354.7595 8.012116 44.28 0.000 339.0504 370.4685
year -.1759554 .0039954 -44.04 0.000 -.1837891 -.1681217
republican -4.015794 .2739618 -14.66 0.000 -4.552941 -3.478647
Total 11023.2328 3398 3.24403555 Root MSE = 1.4298
Model 4080.83996 2 2040.41998 Prob > F = 0.0000
F( 2, 3396) = 998.11
. regress totaltax republican year if population>1000
_cons 350.7437 7.879962 44.51 0.000 335.2937 366.1936
year -.1759554 .0039954 -44.04 0.000 -.1837891 -.1681217
democrat 4.015794 .2739618 14.66 0.000 3.478647 4.55294
Total 11023.2328 3398 3.24403555 Root MSE = 1.4298
Model 4080.83995 2 2040.41998 Prob > F = 0.0000
F( 2, 3396) = 998.11
. regress totaltax democrat year if population>1000

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of anything below 1000 to be a small town, and anything greater than 1000, to be a large town.
These size classifications are in consistency with Fritz’s testing of small versus large towns in
terms of tax and vacation homes (Fritz 383, 1982). Furthermore, as run the regression we can see
that population continues to be so insignificant in the differentiation of total tax, which leads us
to conclude that population alone does not make a difference, and that small towns are not
different than large towns in terms of influence on total tax based solely on population size.
Richard G. Fritz provides an alternative hypothesis of having socioeconomic influences
on total tax rate of a town. He conducted a test to see how tourism and vacation homes affect the
tax ratesHis analysis was based on tourism in select towns, and the development of vacation
homes that are affecting the total tax rate of the town. He argues that the government provides a
monetary alternative in terms of paying taxes for hotel owners that attract tourists. In a town with
high tax rates, for example, these tourists would incur the same amounts of taxes without
receiving any of the governmental benefits that come from having high taxes. However, unlike
the tourist attractions, the impact of a vacation home, acts as a tax burden because it is an extra
portion of land to be responsible for. However, it is also possible, that the effects of vacation
homes, in small towns especially, would increase overall property value. Based on his evidence
and testing, Fritz’s results do not fully take into account the source of tax divergence between
urban and developed rural towns in Vermont, and need to determine if there are other equally
plausible explanations.
Conclusion:
Vermont is a state with its own unique set of procedures and rules. That is what makes
Vermont an interesting state to study; to examine their methods of conducting and developing

Sargsyan | 20
policy in the towns, which in turn would give us insight on our own methods of decision-making.
As we have discussed, partisanship has a strong correlation with the increase or decrease of total
taxes in the state of Vermont. Democratic towns are usually tended toward higher tax rates, and
Republican towns toward lower tax rates.
It is not without the consideration of alternatives that the reading of this paper comes to
an ultimate end. Undeniably, one cannot avoid considering the possibility that there are other
relationships, which lead to the growth or decline of tax rates. To take this idea into perspective,
the tax rates could be the independent variable affecting the partisanship as the dependent
variable instead. As is yet to be proven, the increase of tax rates could be the magnet force
drawing in surrounding Democrats, or if the tax rates are decreasing, then Republicans as the
population of the town shifts. It is true that we disqualified population as an acting influence in
the change in tax rates, but those tests, admittedly, are very limited to strict terms of numbers and
not demographics. The shift in population in terms of demographics, would involve the shift in
partisanship based on the shift in taxes. As the taxes increase, more Democrats choose to live in
the select town, and percentage of Republicans in the population declines in relation to the
growth of the number of Democrats.
Another explanation could involve, instead of a shift in population demographics, a shift
in ideals. The increase in tax rates could incentivize the Democrats who are not for such high
taxes to change their partisanship in order to redirect the flow of taxes in the Vermont towns and
vote Republican. This is to say that partisanship changes because of tax rates acting as the
independent variable influencing partisanship. Even though our tests show that Democrats tend
toward higher taxes, and that a higher percentage of Democrats leads to a higher percentage of
tax rates respectively, there are still many outliers present as is common in any situation

Sargsyan | 21
involving human nature. Our regression analyses are not based on an individual level, but at a
town level showing the partisanship of the entire state of Vermont as a collection of towns. Of
course, the greater the sample size, the more accurate the results will be, but the results, no
matter how accurate, cannot explain 100% of the cause. Republicans as well may also have a
change of heart as has often occurred in the past, and vote for higher taxes. This could be due to
philanthropic reasons, or simply because they believe it is more fair to pay higher taxes.
However, these suggestions are, again, outliers, in the results we have gathered, that should not
be unaccounted.
If partisanship is not taken into account, for example, a cause of tax rates increasing
could be because of a large amount of an under 18 population, forcing the government to provide
more funding to schools and build larger ones, for which they would need more money and
would have to raise taxes.
All in all, though there is simply a possibility for these ideas to be implemented, there is
not sufficient correlation or an initial expectation for the cause to be in lieu of the evident
observations in this paper. As we can see, all of the tests that were performed to investigate the
reliability of my argument, proved to be in very strong correlation to the likelihood of
partisanship being a cause to tax rate change. To summarize my explanations, the P value being
less than .05 suggests a large amount of confidence in the relationship.

Sargsyan | 22
Bibliography
Bryan, Frank M. (2010). Real Democracy: The New England Town Meeting and How
It Works. University of Chicago Press.
Gerber, Alan S. Gregory A Huber, Ebonya Washington. 2010, “Party Affiliation,
Partisanship, and Political Beliefs- A Field Experiment.” American Political Science
Review. 104. No.4. (November), pp. 720-744.
Gerber, Alan S., Gregory A. Huber. 2009, “Partisanship and Economic Behavior- Do
Partisan Differences in Economic Forecasts Predict Real Economic Behavior?” The
American Political Science Review. 103. No. 3. (August), pp. 407-426.
Fritz, Richard G. 1982, “Tourism, Vacation Home Development and Residential Tax
Burden: A Case Study of the Local Finances of 240 Vermont Towns.” American Journal
of Economics and Sociology. 41, No. 4. (October), pp. 375-385.
Parsons, B. M. (2010). Social Networks and the Affective Impact of Political Disagreement.
Political Behavior. 32 No. 2. pp. 181–204.
Zipp, John F., Eric Plutzer. 2004, “Gender Differences in Voting for Female Candidates-
Evidence From the 1982 Election.” Oxford University Press. 49, No. 2. (Summer 1985),
pp. 179-197

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