Overlapping jurisdictions: Substitutes or complements?

This paper presents a simple model of the demand relationship between the activities undertaken by overlapping governments and uses the framework to estimate the relationship between municipal and county expenditures. The empirical results reveal a complementary relationship between county and city general expenditures; any public sector expansion effects of monopoly power at the county level will therefore be reinforced by greater municipal spending, further expanding the total size of the local public sector. On the other hand, changes in county police and roads expenditures appear to have no strong stable impact on municipal police and roads expenditures, respectively, providing no reinforcing or offsetting municipal spending responses to decisions at the county level.     

Local government internal structure, external constraints and the median voter

This paper examines how internal structure and external constraints affect local government ability to meet voters' demands. It applies the revealed preference method to US counties to identify those that fail to satisfy the pure democracy outcome of the median voter hypothesis (MVH). Probit analysis identifies the factors associated with counties that satisfy the MVH. Internal government structure does not matter but restricting home rule increases the likelihood of satisfying the MVH equilibrium, the latter result consistent with the leviathan model. The systematic differences found for urban and rural county governments reinforce this conclusion.     

The productivity of elected and appointed officials: the case of school superintendents

For over 40 years researchers have attempted to test the relative efficiency of governments run by elected versus appointed officials with conflicting results. The focus of prior research has been the expenditure levels of municipal and county governments. In this paper, we consider the achievement of students in public schools. Using data from Florida??s 67 school districts, we compare academic outcomes of students in districts run by elected and appointed superintendents. To overcome selection bias, we utilize both instrumental variable methods and panel data techniques. We find no consistent differences in the performance of elected and appointed superintendents.     

Boxholm tea party: Taxation and voter turnout in a mature democracy

The link between taxation and representation is generally considered foundational to the emergence of democratic governance. Nevertheless, the empirical relationship between taxation and the extent to which citizens actually exert representation by turning out to vote remains virtually unexplored. Using a panel of all Swedish municipalities from 1979 to 2018, I find that hikes in local tax rates are linked to increased municipal voter turnout. Accounting for a wide range of confounders, including turnout in concurrent parliamentary- and county elections, these results indicate an important untapped explanation for changes in turnout, while offering a rare explicit test of the taxation-representation argument drawn from a mature democracy.     

Hobbes and Samuel: reply

Geoffrey Brennan has presented a defense of Hobbes against the claim of misrepresentation of the prophet Samuel as supporting a leviathan. He has also used the occasion of his reply to introduce embellishments that were outside of the scope of my observations concerning the prophet Samuel and Hobbes.     

Managing contract performance: A transaction costs approach

Managing contracts is a complex process, often exacerbated by high transaction costs inherent in negotiating, implementing, and monitoring contract relationships with vendors. Through analyses of data from a 1997 International City/County Management Association survey of municipal and county governments, the way in which municipal and county governments respond to transaction cost factors inherent in contract service delivery is examined. The results of the analyses demonstrate that when governments contract for services in contexts that risk contract failure, they engage in a variety of monitoring techniques to improve their ability to monitor and correct vendor performance. © 2003 by the Association for Public Policy Analysis and Management.     

It Runs in the Family

What motivates citizens to run for office? Recent work has shown that early life parental socialization is strongly associated with a desire to run for office. However, parents not only shape their children’s political environment, they also pass along their genes to those same children. A growing area of research has shown that individual differences in a wide range of political behaviors and attitudes are linked to genetic differences. As a result, genetic factors may confound the observed political similarities among parents and their children. This study analyzes Swedish register data containing information on all nominated and elected candidates in the ten parliamentary, county council, and municipal elections from 1982 to 2014 for a large sample of adoptees and their adoptive and biological parents. By studying the similarity in political ambition within both adoptive and biological families, our research design allows us to disentangle so-called “pre-birth” factors, such as genes and pre-natal environment, and “post-birth” factors like parental socialization. We find that the likelihood of standing as a political candidate is twice as high if one’s parent has been a candidate. We also find that the effects of pre-birth and post-birth factors are approximately equal in size. In addition, we test a number of potential pre- and post-birth transmission mechanisms. First, disconfirming our expectations, the pre-birth effects do not seem to be mediated by cognitive ability or leadership skills. Second, consistent with a role modeling mechanism, we find evidence of a strong transmission in candidacy status between rearing mothers and their daughters.     

Effects of the Form of Government and Property Tax Limits on Local Finance in the Context of Revenue and Expenditure Simultaneity

This paper examines the impact of the form of government and state‐imposed property tax limits on municipal finance. We suggest that municipal revenues and expenditures are determined concurrently and estimate revenue and expenditure functions as simultaneous equations. We use the instrumental variable approach and fixed effects to address revenue and expenditure endogeneity. By testing the model on a cross‐section of rich municipal data for fiscal year 2002, we find evidence that revenues and expenditures are simultaneously determined, that potentially binding state‐imposed property tax limits effectively restrict local revenues and that the form of government is a significant predictor of local expenditures.     

论县级市政府职能转变的制约因素

本从县级市政府职能转变的现状入手,多角度、多方位地分析了影响县级市政府职能转变的诸因素,并扼要指出目前应采取的对策和措施。     

Financing Arlington County, Virginia's Capital Programs: The Experience of the 1980s, The Outlook for the 1990s

County governments in the 1970s had few responsibilities beyond the courts and jail functions. Now, due to large suburban growth in the 1980s, county governments will find themselves immersed in capital financing issues. Arlington County, Virginia, is the setting of this article on the effects of major financings in the 1980s on a county government in the 1990s.     

Categorical Municipal Expenditures with a Focus on the Flypaper Effect

Using data for Wisconsin cities and villages the effects of grants in aid from state government on 10 categories of municipal expenditures are examined. We build on the traditional grants in aid public finance literature by looking for evidence of the flypaper effect. By focusing on the Wisconsin state shared revenues program, a pure grant of considerable size for many Wisconsin municipalities, we offer a clean test of the flypaper effect. We find a positive flypaper effect on 8 of the 10 categorical expenditures. We also find the impact of unconditional grants on categorical expenditures is stronger on nonessential “luxury” goods (e.g., parks and recreation, culture, and educational services) than on essential “normal” municipal goods (e.g., police and fire protection).     

More evidence of the effects of voting technology on election outcomes

Using two different data sources—municipal level data and individual data—we consider several hitherto unexplored aspects of the relationship between voting technology and election outcomes. We distinguish between introductory and permanent effects of electronic voting, and between national and municipal elections. We test for a possible asymmetry between the effect of moving from paper ballots to electronic voting, and vice versa, and we control for polling station density. We find a positive but temporary effect of electronic voting on voter turnout, a negative effect on the fraction of residual votes, and no effect on the share of left wing parties.     

Leviathan in a dual economy

This paper studies the policies of a leviathan state with an ambition to make money and to stay in power. The economic framework is a developing country characterized by dual markets. Government revenue is raised by taxing the agricultural sector. Part of this revenue is offered to the politically influential urban population in the form of low productive but well paid public sector employment. I calculate the optimal level of rural taxation from the point of view of the Leviathan and investigate its effects on migration, industrialization, public sector employment and urban unemployment in different political scenarios.     

Municipal Bond New Issue Transaction Costs

As with any market, there are transaction costs associated with the sale of municipal bonds. Only a small number of studies have examined this topic, and therefore we have only a limited understanding of the magnitude and determinants of new issue municipal bond transaction costs. We use data on California municipal bond transaction costs from 2007 to 2009 to test whether scale economies exist. We find that there are considerable transaction cost scale economies for California municipal bonds and that pooling bond sales would likely save substantial amounts of money.     

Is small beautiful? Transitional and structural effects of municipal amalgamation on voter turnout in local and national elections

The effect of jurisdiction size on democracy is hotly debated. Allegedly, smallness promotes democracy, whereas effectiveness and efficiency increase with size. Neither claim has strong empirical underpinnings. We provide evidence for the former. We use municipal amalgamations as a source of exogenous variation in jurisdiction size and show that it reduced voter turnout in Dutch elections in the 1986–2018 period. This period is sufficiently long to separate potential temporary effects of the amalgamation process from a structural effect of size increase. Surprisingly, we find no evidence of the former. Municipal amalgamation reduces turnout in local elections by 2.2 percentage points and in national elections by 0.7 percentage points. Both effects are long-lasting, persisting at least five elections after amalgamation. More detailed analysis reveals that the most likely driving forces are a weakening of the social norm to vote, and, in municipal elections, increased distance between voters and politics.     

The impact of closeness on electoral participation exploiting the Italian double ballot system

We investigate whether the degree of political competition affects electoral turnout by using Italian municipal election data from 1993 to 2011. Relying on elections held using a double ballot system, we apply an instrumental variable technique exploiting the actual closeness between the two leading candidates in the first round as an instrument for closeness in the second round. The use of this strategy to estimate the impact of closeness on turnout is new to the literature. Controlling for municipal fixed effects and candidates’ characteristics, we find that expected closeness significantly increases turnout, thus supporting the idea that the expected benefits of voting increase in tighter political races. The estimated effect is much larger than that found when measuring closeness with ex-post electoral results, suggesting quite a relevant endogeneity bias in previous studies.     

Local Labor Demand and Program Participation Dynamics: Evidence from New York SNAP Administrative Records

This study estimates the effect of local labor demand on the likelihood that Supplemental Nutrition Assistance Program (SNAP) beneficiaries are able to transition out of the program. Our data include SNAP administrative records from New York (2007 to 2012), linked at the person‐level to the 2010 Census, and linked at the county‐month‐level to industry‐specific labor market conditions. We find that local labor markets matter for the length of time spent on SNAP, but there is substantial heterogeneity in estimated effects across local industries. Using Bartik‐style instruments to isolate the effect of labor demand and controlling for the changing composition of entrants and program rules brought on by the Great Recession, we find that fluctuations in labor demand in industries with high shares of SNAP participants—especially food service and retail—change the likelihood of exiting the program. Notably, estimated industry effects vary across race and parental status, with black participants being most sensitive to changes in local labor market conditions and mothers benefiting less from growth in local labor demand than fathers and non‐parents. We confirm that our results are not driven by endogenous inter‐county mobility or New York City labor markets and are robust to multiple specifications.     

Waste in the Sewer: The Collapse of Accountability and Transparency in Public Finance in Jefferson County,Alabama

Following failed auctions for sewer debt in April 2008, major bond rating companies downgraded Jefferson County, Alabama’s bond rating to D (default) triggering massive mandatory payments by the county to its creditors. At the time of writing, the county teeters on the brink of actual default and bankruptcy, unable to pay service on its $3.3 billion sewer debt portfolio. If the county defaults, it will be the largest municipal bankruptcy in United States history, eclipsing Orange County, California’s 1994 default. The intriguingly complex tale of the Jefferson County debt crisis is recounted here by identifying and examining failures of transparency and accountability by local bureaucratic and political actors, private financial institutions, as well as the larger regulatory framework governing public finance. Enhanced regulation of local government and the financial sector plus greater local government capacity to close accountability gaps and thus prevent future crises of similar scale in this or other jurisdictions are recommended.     

Accounting for Natural Disasters: The Impact of Earthquake Risk on California Municipal Bond Pricing

While Katrina has raised awareness of the potential impact of hurricanes on municipalities along the Gulf Coast, it remains unclear if the municipal bond market considers other types of natural disaster risk in other areas. We attempt to fill this gap by conducting an analysis to determine if underlying geologic earthquake risk affects interest costs for municipal bond issuers in California. We find that earthquake risk does matter in determining the interest costs for municipalities issuing debt, but not universally—only for municipal bonds issued after Hurricane Katrina and only in relation to underlying geologic earthquake risk.     

Consequences of an Anti-Corruption Experiment for Local Government Performance in Brazil

Decentralization reforms, implemented to improve efficiency and service provision, pose a challenge for federal governments that would like to ensure that federal resources are used appropriately by local governments. To overcome this challenge, some federal governments have implemented costly oversight programs aimed at improving municipal governance. For instance, in 2003, the Brazilian federal government introduced a randomized auditing program with the goal of improving municipal performance by exposing episodes of corruption and mismanagement. Yet, we know little about whether these types of programs actually lead to improvements in local outcomes, especially in terms of service delivery. We argue that audits provide opportunities for learning that should improve performance outcomes. To test this argument, we examine municipal performance in over 5,000 Brazilian municipalities from 2001 to 2012. We utilize the random assignment of audits and estimate difference-in-differences regressions. We find that audited municipalities experience greater improvements in performance overall compared to unaudited municipalities, though the effect size is modest. We also find evidence that the auditing program indirectly improves municipal performance. These results indicate that top-down oversight programs, such as the Brazilian one, are useful not only for improving transparency and accountability, but also for the provision of public services as well.