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

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Abstract

The debate about the amalgamation of local government units stems from the fact that their political borders (the institutional territory) do no longer coincide with the functional territory required for an efficient provision of most local public services. And both do not correspond 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. The core question of this paper 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. The paper is divided in six sections. Section one summarizes the debate about LGUs' amalgamation in the Swiss context. Section two tackles the fundamental problem: if too many LGUs are too small, when is small too small and why? Horizontal cooperation is one possible solution, but it creates serious problems in terms of principal-agent, democracy, information asymmetry and moral hazard, explained in Section 3. Section 4 presents the core concept of “noyaux durs” which is one of the effective approaches to LGUs amalgamation. Section 5 details the cantonal financial incentives that are needed to encourage voluntary amalgamation, besides a cantonal planning strategy and technical help in the process of amalgamation. Section 6 concludes with some notes on the performance of the system.

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Paper provided by Faculty of Economics and Social Sciences, University of Freiburg/Fribourg Switzerland in its series FSES Working Papers with number 426.

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Length: 25 pages
Date of creation: 14 May 2012
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Handle: RePEc:fri:fribow:fribow00426

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Keywords: amalgamation of communes; local government; merger; noyaux fort; participative democracy; principal-agent; size of communes; territorial organization; voluntary versus compulsory amalgamation of communes;

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  1. Dafflon, Bernard, 2010. "Local Fiscal Equalization: a New Proposal and an Experiment," FSES Working Papers, Faculty of Economics and Social Sciences, University of Freiburg/Fribourg Switzerland 418, Faculty of Economics and Social Sciences, University of Freiburg/Fribourg Switzerland.
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  1. FUSIÓN DE MUNICIPIOS YA
    by Santiago Lago Peñas in Res Publica on 2012-09-09 14:54:23
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Cited by:
  1. Janne Tukiainen & Tuukka Saarimaa, 2013. "Common Pool Problems in Voluntary Municipal Mergers," Working Papers, Government Institute for Economic Research Finland (VATT) 53, Government Institute for Economic Research Finland (VATT).

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