Municipal Communications Tax Revenue Reliance and Fiscal Impact of Possible Federal Preemption

This paper presents empirical evidence of the extent to which municipal governments might be affected by federal preemption in the communications sector in light of the substantial variation in municipal governments' reliance on communications tax revenues. The results suggest that the federal preemption would have a negative fiscal impact on the majority of municipal governments, and the extent of the impact would vary substantially. The analysis also indicates that it would be challenging or legally impossible for some city governments to make up for the magnitude of revenue loss due to the states' constraints on municipal revenue‐raising capacity.     

数字治理对城市政府善治的影响研究

新公共管理运动和信息技术的发展推动了城市政府治理模式的变革“,善治”成为城市政府治理模式进化的方向。同时,在信息技术和电子政务的推动下,数字治理应运而生,成为信息社会实现城市政府善治的新思路。在对城市政府善治和数字治理进行全面阐释的基础上,构造数字治理环境下城市治理主体互动模式模型、城市网络治理结构模型;结合善治和城市政府善治的基本要素,对数字治理在城市政府善治中的作用进行了深入探讨。研究表明,数字治理借助其强大的技术优势,能形成良好的网络治理结构,加固城市政府善治的合法性基础,增强城市政府的透明性与回应性,明确城市治理主体的责任性,从而能够构建有效的城市政府善治机制,成为数字时代城市政府善治的理想选择。     

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.     

Economic voting in Portuguese municipal elections

This paper analyses the impact of economic conditions on Portuguese municipal electoral outcomes. We use two extensive datasets to estimate an economic voting model which accounts for the possibility that different levels of government have different levels of responsibility for economic outcomes and for clarity of government responsibility. The empirical results indicate that the performance of the national economy is important especially if local governments are of the same party as the central government. The municipal situation is also relevant particularly in scenarios of greater clarity of national and sub-national government responsibility.     

Leviathan in the Crosshairs

Following in the spirit of the Leviathan hypothesis, this paper empirically examines how the degree of local government market power influences efficiency in the local public sector. Market power is measured by the number and relative size distribution of similar government units in the same market area. To avoid confusing market power with the comparative efficiency or superiority of larger sized organizations, the relative size distribution of the individual government unit is held constant in the empirical analysis. In the empirical test, aggregate property values serve as the measure of efficiency. The empirical results suggest that aggregate property values are lower and thus efficiency suffers, in more concentrated municipal market areas, ceteris paribus, thus providing some evidence for Leviathan-type governments in Connecticut.     

Negative Externality of Fiscal Problems: Dissecting the Contagion Effect of Municipal Bankruptcy

The fiscal decision of one local government may spill over to other localities, and such externality could justify and inform policy making by a higher‐level government. Theories of municipal bond market contagion postulate that once a local government files for bankruptcy, localities sharing similar characteristics will be perceived negatively by creditors and charged a higher interest rate. In this article, empirical examination of the second‐largest municipal bankruptcy in American history shows no support for general contagion based on geographic proximity. That is, nearby localities did not pay a higher interest rate after the bankruptcy. However, case‐specific contagion formed around borrower‐ and bond‐specific characteristics contributing to the bankruptcy: general‐purpose borrowers and general‐obligation bonds experienced increased borrowing costs after the bankruptcy. These findings have implications for states considering granting authorizations for municipal bankruptcy or providing financial assistance to struggling localities, as well as for local governments planning to access the municipal bond market.     

A Comparative Study of the Effects of Institutional Arrangements in Municipal Solid Waste Services in Korea

In Korea, local governments are primarily responsible for providing municipal solid waste services to citizens. This paper examines the effects of different institutional arrangements and characteristics on cost savings, efficiency gains and productivity in the delivery of municipal solid waste services to citizens. In order to carry out this research, a hybrid cost function approach was employed, and cross-sectional time-series data from local governments of Korea covering a ten-year period (2000–2009) were used for empirical analysis. Empirical findings indicated that there were no effects of contracting-out on cost savings, efficiency and productivity gains in Korea. Specifically, the solid waste service costs were not significantly lower under contracting-out than under direct public delivery. In addition, contrary to the arguments of the proponents of privatization or contracting-out, efficiency and productivity gains were actually higher under direct public delivery than when contracted out.     

Theories of coalition formation: An empirical test using data from Danish local government

Abstract.  Theories of coalition formation represent a diverse set of arguments about why some government coalitions form while others do not. In this article, the authors present a systematic empirical test of the relative importance of the various arguments. The test is designed to avoid a circularity problem present in many coalition studies – namely that the theories are tested on data of national government coalitions in postwar Europe: the very data that gave rise to the theories in the first place. Instead, the authors focus on government coalitions at the municipal level. They base their analysis on an expert survey of almost 3,000 local councillors from all municipalities in Denmark. They use conditional logit analysis to model government formation as a discrete choice between all potential governments. The analysis confirms some, but far from all, traditional explanations such as those based on office and policy motives. At the same time, the analysis raises the question of whether actors really seek minimal coalitions.     

What Have We Learned about the Performance of Council‐Manager Government? A Review and Synthesis of the Research

The 100th anniversary of the International City/County Management Association provides an excellent point to review and assess research on the performance of the council‐manager form of government. The development of the council‐manager form arguably has been the most important innovation in American local government over the last century, yet its impact on the performance of municipal governments is not well understood. This article reviews and assesses the empirical evidence for 10 propositions that council‐manager governments perform better than mayor‐council governments. This evidence indicates that although progress has been made on demonstrating differences in representation and functionality, the proposition that council‐manager governments are better managed than mayor‐council governments has yet to be seriously engaged in this literature. Filling this critical gap requires progress in two areas: the development of theory to explain why council‐manager governments are better‐managed organizations and the production of evidence assessing the major propositions of this theory.     

Unfunded Mandates and Fiscal Structure: Empirical Evidence from a Synthetic Control Model

An unfunded expenditure mandate occurs when governments are required to provide a good or service by a higher level of government without an accompanying revenue source. There are no empirical studies providing causal evidence on the fiscal influence of intergovernmental mandates. This article examines Florida's 1990 constitutional Amendment 3, which sought to limit unfunded state mandates on municipal and county governments. The synthetic control method, an empirical technique for drawing causal inferences from case studies, estimates the effect of Amendment 3 on state expenditures and total transfers to local governments. The results indicate that state expenditures increased by an annual average of 9.5 percent, while state transfers to all local governments were unaffected. However, the municipalities protected by Amendment 3 saw intergovernmental revenue from the state decrease by 10 percent annually, which suggests that remaining mandates likely targeted special districts, encouraging the fragmentation of local public service delivery.     

How Municipal Property Tax Responded to State Aid Cuts: The Case of Massachusetts Municipalities in the Post‐2001 Fiscal Crisis

This empirical study examines municipal property tax responses to state aid cuts during the post‐2001 fiscal crisis. Using panel econometric techniques on annual changes in property tax levy by 351 incorporated Massachusetts municipalities in the period of 2002–2006, the results suggest that municipal governments offset about 9 cents of each dollar of net state aid cut through the increase of their property tax rates. It contributes to public finance literature on the extent to which local property tax can be used to stabilize municipal revenues when the intergovernmental revenue shrinks.     

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.     

The median voter model across levels of government

The median voter model provides a method of aggregating individual voter's demands to obtain community demand. Although higher level governments are often assumed to be less responsive to voters than lower level governments, it remains an open question whether or not the median voter model, which has been found to apply to the lowest tier of the federalist system, extends to higher level governments. We use the Cox specification test to find that the ad hoc model dominates the median model for counties and states. The county results are sensitive to the time periods, budgetary structure, and degree of urbanization.     

Are Overlapping Local Governments Competing With Each Other When Issuing Debt?

Local public services are produced through various overlapping jurisdictions. This study examines how the issuance of municipal general obligation bonds is affected by the tax policies of overlapping local governments. The findings challenge the hypothesis that the shared tax base would be overused in a common-pool resource scenario. Instead, the empirical results show that the issuance of general obligation bonds is more likely in jurisdictions where counties and school districts make more intensive use of the property tax. These findings highlight the importance of the signals local governments receive from their overlapping neighbors regarding voters’ demand for additional public spending.     

State Mandated Accounting, Auditing and Finance Practices and Municipal Bond Ratings

The accounting, auditing, and finance practices of municipal governments often are legally constrained by regulations imposed by state governments under whose jurisdiction cities are created. These practices may impact on municipal security risks and returns, either directly in the bond market or indirectly through such market intermediaries as bond rating agencies. The purpose of this article is to assess the impact of state mandates on municipal bond ratings.     

Non‐Governmental Monitoring of Local Governments Increases Compliance with Central Mandates: A National‐Scale Field Experiment in China

Central governments face compliance problems when they rely on local governments to implement policy. In authoritarian political systems, these challenges are pronounced because local governments do not face citizens at the polls. In a national‐scale, randomized field experiment in China, we test whether a public, non‐governmental rating of municipal governments' compliance with central mandates to disclose information about the management of pollution increased compliance. We find significant and positive treatment effects on compliance after only one year that persist with reinforcement into a second post‐treatment year. The public rating appears to decrease the costs of monitoring compliance for the central government without increasing public and media attention to pollution, highlighting when this mode of governance is likely to emerge. These results reveal important roles that nonstate actors can play in enhancing the accountability of local governments in authoritarian political systems.     

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 Limits and Opportunities of Networks: Municipalities and Canadian Climate Change Policy

Research on climate change policy and politics has become increasingly focused on the actions and influence of subnational governments. In North America, this attention has been particularly focused on why subnational governments have taken action in the absence of national leadership, what effect action might have on future national climate policy, and whether the collective action of networks of municipal governments are reshaping and challenging the character of national and global climate governance. This paper examines Canadian municipal climate in light of the absence of a comprehensive and effective climate national strategy. The paper considers various reasons why local governments in Canada have not been central players in national plans, and why their actions have not been more influential nationally. The paper argues that the potential influence of Canadian municipalities on national climate policy is weak, given the loose nature of the network and the long-held structural view that municipalities are not significant units of political analysis in national political and policy debates. The paper concludes by considering the constraints and opportunities of subnational climate networks and municipal network analysis.     

The economic model of voter participation: A further test

The central hypothesis of the economic model of voter participation was put to an empirical test. It was found that the coefficient of population size, which represents the subjective probability of affecting election results, is negative and significant in municipal local elections, but insignificant in national Knesset elections. Therefore, this variable is unable to represent subjective probability in the latter case.It was suggested that the economic model is more relevant to local elections than to Knesset elections. The empirical results revealed that the regression coefficients of municipal elections that took place separately from Knesset elections fit the expected outcome of the economic model whereas when municipal elections were held simultaneously with the Knesset election this did not hold true.     

Use of Capital Budgeting Techniques and an Analytic Approach to Capital Investment Decisions in Canadian Municipal Governments

Capital budgeting techniques are useful tools to municipal administrators in managing organizational resources. A survey of capital budgeting practices of Canadian municipal governments reveals that a minority used capital budgeting techniques; payback period dominates over discounted cash flow analysis in evaluating capital investments; and pitfalls are common in its application. More specifically, there is an emphasis of quantitative/financial items over qualitative/intangible factors. In this study, the analytic hierarchy process, a multi-attribute decision model that accounts for both tangibles and intangibles, is presented as a tool for capital budgeting decisions such that resource allocation becomes more effective in municipal governments.