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The Necessity Of An Administrative-Territorial Reform In A Country: The Case Of Estonia


  • Janno Reiljan
  • Aivo Ülper


The goal of this paper is to analyze the theoretical, political and organizational bases of the territorial division of the country into municipalities and offer a research direction for identifying conceptual solutions to the development problems in Estonian municipalities. The paper focuses on the territorial organization of administrative issues, looking at the remaining administrative aspects only insofar as they relate to the territorial organization of public administration and services. In order to accomplish the goal we tackle the following research tasks: systematize theories concerning the territorial division of the country into municipalities and analyze the possibilities and limitations for their application; discuss administrative-territorial reforms in Nordic countries, their causes and consequences; describe the development, nature and indicators of the administrative-territorial division of Estonia; empirically analyze the relationship between municipal size and capability and development indicators. The analysis of the theoretical approaches to municipal size pointed out that they are fragmented and incompatible. Some authors support small municipalities, and others large. The theoretical reasoning of both those directions is often strongly simplified and biased and a unified meta-theoretical approach has not been established. The empirical analysis revealed that there is no empirical evidence to confirm either the presence of significant size related advantages among municipalities or the existence of an optimal municipal size considering current municipal functions and financing. The lack of theoretical and empirical evidence on the necessity for administrative-territorial reform means that merging municipalities alone cannot significantly improve the public service delivery capacities and economic and democratic development of Estonian municipalities. This means that future studies should focus on analyzing public services from the perspective of their economic efficiency, quality and accessibility, and in doing so, determine the optimal size of regions for providing the various public services.

Suggested Citation

  • Janno Reiljan & Aivo Ülper, 2010. "The Necessity Of An Administrative-Territorial Reform In A Country: The Case Of Estonia," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 77, Faculty of Economics and Business Administration, University of Tartu (Estonia).
  • Handle: RePEc:mtk:febawb:77

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    References listed on IDEAS

    1. Paul R. Portney, 2008. "The (Not So) New Corporate Social Responsibility: An Empirical Perspective," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 2(2), pages 261-275, Summer.
    2. Sousa-Poza, Alfonso & Sousa-Poza, Andres A., 2000. "Well-being at work: a cross-national analysis of the levels and determinants of job satisfaction," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 29(6), pages 517-538, November.
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    Cited by:

    1. Chang Woon Nam, 2014. "Subnational Government System in the EU and Its Recent Reforms," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 11(4), pages 44-47, 01.
    2. repec:ces:ifodic:v:11:y:2014:i:4:p:19105986 is not listed on IDEAS

    More about this item


    optimal size of municipalities; local governments’ financial potential; local political development; amalgamation; local government reform; local government efficiency;

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General

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