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Stronger together? Assessing the causal effect of inter-municipal cooperation on the efficiency of small Italian municipalities

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  • Luca, Davide
  • Modrego, Felix

Abstract

When local governments are small and fragmented, promoting inter-municipal cooperation (IMC) among them is seen as a tool to improve the management of public services by reaping economies of scale and scope. Yet, the empirical evidence on the impacts of IMC on local governments' efficiency is scarce and inconclusive. In this paper, we investigate the experience of Italy's municipal unions (Unioni di comuni). We develop an index of technical efficiency by means of robust data envelopment analysis. We then exploit nearest-neighbor matching and fuzzy regression discontinuity design estimators to explore whether municipal unions have any impacts on the administrative efficiency of member municipalities. We fail to find any strong, significant effect.

Suggested Citation

  • Luca, Davide & Modrego, Felix, 2020. "Stronger together? Assessing the causal effect of inter-municipal cooperation on the efficiency of small Italian municipalities," LSE Research Online Documents on Economics 108193, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:108193
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    Cited by:

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    2. Giuseppe Liddo & Michele G. Giuranno, 2020. "The political economy of municipal consortia and municipal mergers," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 37(1), pages 105-135, April.
    3. Touria Jaaidane & Sophie Larribeau & Matthieu Leprince, 2024. "Inter-municipal cooperation and public employment: evidence from French municipalities," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 72(3), pages 987-1014, March.
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    5. Marco Di Cataldo & Licia Ferranna & Margherita Gerolimetto & Stefano Magrini, 2023. "Splitting Up or Dancing Together? Local Institutional Structure and the Performance of Urban Areas," Economic Geography, Taylor & Francis Journals, vol. 99(1), pages 81-110, January.
    6. Sonia Paty & Morgan Ubeda, 2021. "Inter-municipal cooperation and the provision of local public goods," Working Papers 2121, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    7. Augusto Cerqua & Costanza Giannantoni & Federico Zampollo & Matteo Mazziotta, 2025. "The Municipal Administration Quality Index: The Italian Case," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 177(1), pages 345-378, March.
    8. Clémence Tricaud, 2019. "Better alone? Evidence on the costs of intermunicipal cooperation," Economics Working Paper from Condorcet Center for political Economy at CREM-CNRS 2019-12-ccr, Condorcet Center for political Economy.
    9. de la Higuera-Molina, Emilio José & Campos-Alba, Cristina María & López-Pérez, Germán & Zafra-Gómez, José Luis, 2023. "Efficiency of water service management alternatives in Spain considering environmental factors," Utilities Policy, Elsevier, vol. 84(C).
    10. Banaszewska, Monika & Bischoff, Ivo & Bode, Eva & Chodakowska, Aneta, 2022. "Does inter-municipal cooperation help improve local economic performance? – Evidence from Poland," Regional Science and Urban Economics, Elsevier, vol. 92(C).
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    12. Giampaolo Arachi & Debora Assisi & Berardino Cesi & Michele G. Giuranno & Felice Russo, 2024. "Intermunicipal cooperation in public procurement," Regional Studies, Taylor & Francis Journals, vol. 58(11), pages 2055-2073, November.
    13. Germà Bel & Thomas Elston, 2024. "When the time is right: testing for dynamic effects in collaborative performance," Public Management Review, Taylor & Francis Journals, vol. 26(12), pages 3429-3455, December.
    14. Mehdi Guelmamen, 2024. "Organizational Pathways in Drinking Water Governance: A Literature Review," Working Papers of BETA 2024-48, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    15. Edoardo Di Porto & Angela Parenti & Sonia Paty, 2025. "The political cost of integration: A natural experiment on local governments," Working Papers hal-04926788, HAL.
    16. Tommaso Agasisti & Pietro Massaggia & Teo Miserocchi, 2025. "The Relationship between Local Governments Efficiency and Quality of Life: an Empirical Analysis on Italian Provinces," Working papers 120, Società Italiana di Economia Pubblica.
    17. Perugini, Francesco, 2024. "Local government efficiency and economic growth: The Italian case," Socio-Economic Planning Sciences, Elsevier, vol. 91(C).
    18. Jose-Luis Zafra-Gómez & Germán López-Pérez & Marta Garrido-Montañés & Elisabeth Zafra-Gómez, 2023. "Cost Efficiency in Municipal Solid Waste (MSW): Different Alternatives in Service Delivery for Small and Medium Sized Spanish Local Governments," Sustainability, MDPI, vol. 15(7), pages 1-14, April.

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    Keywords

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    JEL classification:

    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • R51 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Finance in Urban and Rural Economies

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