IDEAS home Printed from https://ideas.repec.org/a/kap/pubcho/v37y1981i3p569-578.html
   My bibliography  Save this article

The expenditure effects of restricting competition in local public service industries: The case of special districts

Author

Listed:
  • Thomas Dilorenzo

Abstract

The purpose of this paper has been to extend the type of positive economic analysis of the urban public economy that has been initiated by Wagner and Martin (1978), Wagner and Weber (1975), Ostrom et al. (1976), and others. The hypothesis was tested that restricting the growth of single-purpose special districts renders local service industries more monopolistic and should therefore increase local public expenditure levels. Evidence brought forth indicates that the effect of such restrictions imposed in two states, California and Oregon, was to increase general per capita expenditures, ceteris paribus. Per capita expenditures on water supply and fire protection, two services frequently provided by special districts, were also seen to increase dramatically after controlling for other supply and demand determinants of local public expenditures. Thus the empirical test of the last section supports the monopoly-enhancing view of special district growth restrictions and leads us to reject the alternative reformist hypothesis that consolidating or annexing special districts will lead to improved hierarchical organization of local government and diminish the cost of providing local public services. As the economics of regulation would predict, regulating the growth of special districts is a way that local politicians and bureaucrats can use the powers of the state to limit entry into the local government industry, thereby enhancing their monopoly power. Copyright Martinus Nijhoff Publishers 1981

Suggested Citation

  • Thomas Dilorenzo, 1981. "The expenditure effects of restricting competition in local public service industries: The case of special districts," Public Choice, Springer, vol. 37(3), pages 569-578, January.
    • Handle: RePEc:kap:pubcho:v:37:y:1981:i:3:p:569-578
    DOI: 10.1007/BF00133753
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/BF00133753
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/BF00133753?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Wagner, Richard E & Weber, Warren E, 1975. "Competition, Monopoly, and the Organization of Government in Metropolitan Areas," Journal of Law and Economics, University of Chicago Press, vol. 18(3), pages 661-684, December.
    2. Martin, Dolores Tremewan & Wagner, Richard E, 1978. "The Institutional Framework for Municipal Incorporation: An Economic Analysis of Local Agency Formation Commissions in California," Journal of Law and Economics, University of Chicago Press, vol. 21(2), pages 409-425, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mark Schneider, 1986. "Fragmentation and the growth of local government," Public Choice, Springer, vol. 48(3), pages 255-263, January.
    2. Stephen Mehay, 1984. "The effect of governmental structure on special district expenditures," Public Choice, Springer, vol. 44(2), pages 339-348, January.
    3. Robert Blewett, 1984. "Off-budget activities of local government: Comment," Public Choice, Springer, vol. 42(2), pages 205-211, January.
    4. Juan Luis Gómez-Reino & Santiago Lago-Peñas & Jorge Martinez-Vazquez, 2021. "Evidence on Economies of Scale in Local Public Service Provision: A Meta-Analysis," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper2116, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    5. Jorge Martinez-Vazquez, 2013. "Fiscal Decentralization in Peru: A Perspective on Recent Developments and Future Challenges," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1324, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    6. Keith Dowding & Peter John & Stephen Biggs, 1994. "Tiebout : A Survey of the Empirical Literature," Urban Studies, Urban Studies Journal Limited, vol. 31(4-5), pages 767-797, May.
    7. Alexander Fink & Richard Wagner, 2013. "Political entrepreneurship and the formation of special districts," European Journal of Law and Economics, Springer, vol. 35(3), pages 427-439, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kenneth Greene, 1984. "Sequential referenda and bureaucratic man," Public Choice, Springer, vol. 43(1), pages 77-82, January.
    2. Robert Blewett, 1984. "Off-budget activities of local government: Comment," Public Choice, Springer, vol. 42(2), pages 205-211, January.
    3. Dolores Martin & James Schmidt, 1983. "Expenditure effects of metropolitan tax base sharing: A public choice analysis," Public Choice, Springer, vol. 40(2), pages 175-186, January.
    4. Jeffrey Zax, 1988. "The Effects of Jurisdiction Types and Numbers on Local Public Finance," NBER Chapters, in: Fiscal Federalism: Quantitative Studies, pages 79-106, National Bureau of Economic Research, Inc.
    5. Stephen Mehay, 1984. "The effect of governmental structure on special district expenditures," Public Choice, Springer, vol. 44(2), pages 339-348, January.
    6. Keith Dowding & Peter John & Stephen Biggs, 1994. "Tiebout : A Survey of the Empirical Literature," Urban Studies, Urban Studies Journal Limited, vol. 31(4-5), pages 767-797, May.
    7. D.P. Doessel & Abbas Valadkhani, 2002. "Public Finance and The Size of Government: A Literature Review and Econometric Results for Fiji," School of Economics and Finance Discussion Papers and Working Papers Series 108, School of Economics and Finance, Queensland University of Technology.
    8. Bruno S. Frey & Alois Stutzer, "undated". "The Role of Direct Democracy and Federalism in Local Power," IEW - Working Papers 209, Institute for Empirical Research in Economics - University of Zurich.
    9. Bruno S. Frey & Alois Stutzer, "undated". "Direct Democracy: Designing a Living Constitution," IEW - Working Papers 167, Institute for Empirical Research in Economics - University of Zurich.
    10. Frey, Bruno S., 2004. "Direct Democracy for a Living Constitution," Freiburg Discussion Papers on Constitutional Economics 04/5, Walter Eucken Institut e.V..
    11. Shirley Kress, 1989. "Niskanen effects in the California Community Colleges," Public Choice, Springer, vol. 61(2), pages 127-140, May.
    12. Doessel, Darrel & Valadkhani, Abbas, 2003. "The Demand for Current Public Expenditure in Fiji: Theory and Empirical Results," MPRA Paper 50392, University Library of Munich, Germany.
    13. Scorsone, Eric, 2007. "School District and Municipal Reorganization: Research Findings & Policy Proposals," Staff Paper Series 6543, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    14. Thomas DiLorenzo, 1982. "Utility profits, fiscal illusion, and local public expenditures," Public Choice, Springer, vol. 38(3), pages 243-252, January.
    15. Samuel Staley & John Blair, 1995. "Institutions, quality competition and public service provision: The case of public education," Constitutional Political Economy, Springer, vol. 6(1), pages 21-33, December.
    16. Ali Cenap Yologlu, 2018. "Politics of Municipal Consolidation: The Case of Denizli," SAGE Open, , vol. 8(2), pages 21582440187, April.
    17. Thomas A. Garrett & Russell M. Rhine, 2006. "On the size and growth of government," Review, Federal Reserve Bank of St. Louis, vol. 88(Jan), pages 13-30.
    18. Rodolfo Gonzalez & Roger Folsom & Stephen Mehay, 1989. "Bureaucracy, publicness and local government expenditures revisited: Comment," Public Choice, Springer, vol. 62(1), pages 71-77, July.
    19. Kenneth Greene, 1982. "The median voter and his elasticity of substitution," Public Choice, Springer, vol. 39(2), pages 283-289, January.
    20. Rosen Valchev & Antony Davies, 2009. "Transparency, Performance, and Agency Budgets: A Rational Expectations Modeling Approach," Working Papers 2009-004, The George Washington University, Department of Economics, H. O. Stekler Research Program on Forecasting.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:pubcho:v:37:y:1981:i:3:p:569-578. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.