The Challenge of Local Government Size

The Challenge of Local Government Size

Theoretical Perspectives, International Experience and Policy Reform

Studies in Fiscal Federalism and State–local Finance series

Edited by Santiago Lago-Peñas and Jorge Martinez-Vazquez

Expert contributors in economics and political science offer a comprehensive breakdown of the issue of local jurisdiction fragmentation and provide recommendations for successful policy reform. Topics discussed include economies of scale, the costs and benefits of voluntary and forced amalgamation programs, the correlation between government size and corruption, privatization, and inter-municipal cooperation. A combination of theory and empirical evidence provides depth and makes this book an invaluable addition to the literature.

Chapter 2: An international perspective on the determinants of local government fragmentation

Juan Luis Gómez-Reino and Jorge Martinez-Vazquez

Subjects: economics and finance, public sector economics, politics and public policy, public policy


Subnational government fragmentation, associated with the small size of jurisdictions to take advantage of economies of scale in service delivery, is a commonly perceived problem in many decentralized systems around the globe. Subnational government fragmentation typically takes the form of an excessive number of subnational jurisdictions at any level of government, most often at the local or municipal level. But fragmentation may also have other manifestations, including in particular the number of tiers or levels of subnational governments. As is to be expected, however, the degree of jurisdictional fragmentation varies widely from country to country and through different regions of the world. In order to examine the extent and determinants of jurisdictional fragmentation in this chapter, we will use the most recent available information for a sample of 197 countries. The analysis of the raw data shows considerable diversity in terms of jurisdictional fragmentation.

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