Do Municipal Mergers Improve Fiscal Outcomes?

Improved fiscal management is a frequent justification for promoting boundary consolidations. However, whether or not this is actually the case is rarely placed under rigorous empirical scrutiny. Hence, this article investigates if fiscal outcomes are improved when municipalities are merged. The basic argument is that the conceptualisation of fiscal management in political science is often too narrow as it focuses on the budget and pays hardly any attention to balances in the final accounts and debts – elements of management which are central to policy making. On this background, the causal relationship between municipal mergers and fiscal outcomes is analysed. Measured on the balance between revenues and expenses, liquid assets and debts, municipal mergers improve the fiscal outcomes of the municipalities in a five‐year perspective, although the pre‐reform effects tend to be negative. For liquidity and debt, however, the improvement only entails re‐establishing the levels prior to the reform. The testing ground is the recent mergers of Danish municipalities, which, it is argued, constitute a quasi‐experiment. This forms the basis of a Difference‐in‐Difference design, allowing the alleviation of endogeneity problems and enabling causal inference. The analysis is based on administrative data from the Danish municipalities in the period 2003–11.     

Do Municipal Mergers Improve Technical Efficiency? An Empirical Analysis of the 2008 Queensland Municipal Merger Program

Municipal mergers remain an important instrument of local government policy in numerous countries, including Australia, despite some concerns surrounding its efficacy. We consider the claim that amalgamations enhance the technical efficiency of the merged entities by examining the 2008 Queensland compulsory consolidation program that reduced the number of local authorities from 157 to 73 councils. To test the claim, we conduct locally inter‐temporal data envelopment analysis over the period 2003–2013 inclusive. Our evidence suggests that (1) in the financial year preceding the mergers, there was no statistically significant difference in the typical efficiency scores of amalgamated and non‐amalgamated councils and (2) 2 years following the mergers, the typical technical efficiency score of the amalgamated councils was well below the non‐amalgamated cohort. We argue this may be attributed to increased spending on staffing expenses, although comparatively larger operational expenditure also served to diminish efficiency.     

Counterterrorism Policies and Attitudes Towards Out-Groups: Evidence from a Survey Experiment on Citizens’ Attitudes Towards Wiretapping

Political Behavior - Terrorism often leads to increased stigmatization of groups perceived as “out-groups”. We test two versions of out-group theory and ask whether citizens clearly...