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 8: Voluntary amalgamation of local governments: the Swiss debate in the European context

Bernard Dafflon

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


The debate about the amalgamation of local government units (hereafter LGUs for simplicity – in Switzerland “communes” or “Gemeinden”) usually stems from the fact that LGUs’ political borders (the institutional territory) no longer coincide with the economic boundaries required for an efficient provision of most local public services (the functional territory). And neither corresponds with the relational territory which arises out of the private and professional activities of LGUs’ residents as they commute daily or periodically for work, shopping and leisure (Dafflon and Ruegg, 2003: 890). Additional problems are the openness of economic activities and the emergence of industrial clusters which largely overlap local boundaries. Finally, urban areas and agglomerations usually regroup several neighboring LGUs whereas the needs for specific public services are identical in each of them and require horizontal cooperation. The core question of this chapter is how to reform the institutional and functional territories in such a way that public services are delivered efficiently, according to local preferences and in a way that responds to the needs expressed in the larger relational territory.

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