In search of the optimal size for local government: an assessment of economies of scale in local government in Croatia

2021 ◽  
pp. 1-25
Author(s):  
Antonija Buljan ◽  
Sandra Švaljek ◽  
Milan Deskar-Škrbić
Keyword(s):  
Local Government ◽  
Economies Of Scale ◽  
Optimal Size

scholarly journals The Effect of Shared Service Centers on Administrative Intensity in English Local Government: A Longitudinal Evaluation

2019 ◽  
Vol 30 (1) ◽  
pp. 113-129 ◽  
Author(s):  
Thomas Elston ◽  
Ruth Dixon
Keyword(s):  
Local Government ◽  
Economies Of Scale ◽  
Administrative Support ◽  
Local Authority ◽  
Structural Complexity ◽  
Change Score ◽  
Support Functions ◽  
Service Adoption ◽  
Shared Service ◽  
Primary Service

Abstract “Administrative intensity” (AI) describes the proportion of total resources that organizations spend on administrative support functions rather than primary service and production processes. We test whether “sharing” administrative activities between organizations leads to a fall in AI due to economies of scale, as is often supposed, using organizational and financial data from more than 300 English local authorities. We employ multi-wave change score regression analysis to relate changes in AI from 2008 to 2016 to levels of shared services participation, and further test whether reform performance varies by category of local authority, type of administration, or degree of structural complexity. Although we find that some measures of AI fell slightly over this period, this was unrelated to shared service adoption for any category of local authority. Sharing of clerical rather than professional types of administration, and sharing by organizations and within partnerships characterized by lower structural complexity, also failed to improve reform outcomes. Faulty assumptions about the extent of administrative scale diseconomies in English local government partly explain this significant reform underperformance.

“Small Is Beautiful”

2016 ◽  
pp. 113-134 ◽  
Author(s):  
Juraj Nemec ◽  
Lenka Matejova ◽  
Jana Soukopová
Keyword(s):  
Czech Republic ◽  
Public Services ◽  
Economies Of Scale ◽  
Scale Economies ◽  
Optimal Size ◽  
The Czech Republic ◽  
Municipal Expenditures

This chapter discusses the problem of territorial fragmentation and summarizes the arguments for and against a solution in the form of territorial consolidation regarding the example of the Czech Republic. The main reason for the consolidation of municipalities are the benefits derived from the theory of the economies of scale. Linked to this is also the question of how to determine the optimal size of a municipality in order to make the best use of the principles of scale economies. The second part of this chapter shows an analysis of Czech municipal expenditures on selected public services that municipalities provide, and based on the results, determine the optimal size of the municipality for the analyzed services. Data from the Czech Republic do not clearly support the economic arguments for territorial consolidation

scholarly journals New directions in New Zealand local government

2010 ◽  
pp. 158-175 ◽  
Author(s):  
Peter McKinlay
Keyword(s):  
New Zealand ◽  
Local Government ◽  
Local Governments ◽  
Economies Of Scale ◽  
New Public Management ◽  
Business Community ◽  
Local Authorities ◽  
Proper Role ◽  
Starting Point

The purpose of this paper is to provide a ‘work in progress’ report on some initiatives emerging from local government practice in New Zealand which should help us consider how we think about the role of local government in a world which is undergoing dramatic change. The starting point is work which the writer undertook with the support of Local Government New Zealand (the national association) and a number of New Zealand councils considering the ‘proper role’ of local government. The context is an ongoing public debate driven substantially by the New Zealand business community from a perspective that this ‘proper role’ should be restricted to the delivery of local public goods, narrowly defined. This has included argument that local governments themselves should be structured substantially to promote the efficient delivery of services generally within the now well understood prescriptions of the ‘new public management’. One implication which the business sector in particular drew in looking at the workings of local government was that there should be economies of scale through further amalgamation of councils (the local government sector having been through a major amalgamation process in 1989 which eliminated a large number of special purpose authorities and reduced the number of territorial local authorities from more than 200 to 73). Debate continues, with the latest manifestation being the National Party led government's proposals for the restructuring of local government within the Auckland region, New Zealand's major metropolitan area. The initiatives discussed in this paper are partly a response, but more significantly a result of selected local authorities reflecting on the nature of their role, and the opportunities for being proactive in using their statutory privileges in ways that could produce benefits for their communities without any associated increase in the cost of local government itself.

scholarly journals Drivers of service delivery modes in Dutch local government: an analysis over time and across domains

2020 ◽  
pp. 002085232096890
Author(s):  
Martijn Schoute ◽  
Raymond Gradus ◽  
Tjerk Budding
Keyword(s):  
Local Government ◽  
Service Delivery ◽  
Transaction Cost ◽  
Economies Of Scale ◽  
Institutional Form ◽  
Service Characteristics ◽  
Delivery Modes ◽  
House Production ◽  
Cost Characteristics ◽  
Over Time

This study investigates the influence of service, financial and political characteristics on municipalities’ choices of four service delivery modes in the Dutch local government setting, thereby making a distinction between services in the physical and in the operational domain. It shows that, overall, use of inter-municipal cooperation and, to a lesser extent, municipality-owned firms increased substantially from 2010 to 2018. For use of private firms, we find remarkable differences. Whereas this use increased for the physical domain, it decreased for the operational domain. For both domains, we find that in-house production decreased substantially. We also find that the influence of especially transaction cost characteristics on the likelihood that municipalities choose a certain institutional form differs between 2010 and 2018, as well as between the physical and the operational domain. Points for practitioners Our finding that the use of in-house production decreased substantially from 2010 to 2018 suggests that municipalities are looking for mixed institutional forms, such as inter-municipal cooperation, to realize economies of scale. We observe that service delivery modes are especially driven by service characteristics, thereby stressing the importance of transaction cost motives in decisions about service delivery modes. However, our study also shows that financial and political characteristics have some influence. As the effects of the latter are not stable, we show that the way to implement reforms may vary over time and across domains.

Economies of Scale and Local Government Expenditure

2012 ◽  
Vol 46 (6) ◽  
pp. 632-653 ◽  
Author(s):  
Joseph Drew ◽  
Michael A. Kortt ◽  
Brian Dollery
Keyword(s):  
Local Government ◽  
Economies Of Scale ◽  
Government Expenditure ◽  
Local Government Expenditure

The evidence on the existence of economies Of scale in local government units

2017 ◽  
Vol 1 (2) ◽  
pp. 379 ◽  
Author(s):  
Primož Pevcin
Keyword(s):  
Local Government ◽  
Economies Of Scale ◽  
Returns To Scale ◽  
Scale Economies ◽  
Scale Efficiency ◽  
Data Envelopment ◽  
Administrative Costs ◽  
Government Operation ◽  
Major Reform ◽  
Limited Scale

<p>The purpose of this paper is to empirically verify if the possible existence of scale economies actually supports the argument that municipal consolidation is needed in Slovenia. The major reform of local self-government in Slovenia was implemented in 1994, when the transformation of existing 58 »communal« municipalities was envisaged. From 1995 onwards, the number of municipalities increased to the current number of 212 municipalities. Consequently, the necessity to implement structural reforms of local self-government in Slovenia has been stressed. The arguments favoring municipal amalgamations stressed that country has become too fragmented and municipal amalgamation would enable the reduction of (administrative) costs, and increase efficiency as well as quality of services provided, indicating that technical aspects of local government operation are targeted. Following, technical efficiency of Slovenian municipalities is estimated with the Data Envelopment Analysis (DEA) method, in order to determine if (and which) municipalities are experiencing increasing returns to scale (i.e., scale economies). The results indicate that there is important scale efficiency component, and predominantly very small municipalities are experiencing economies of scale, but their number is relatively low. Therefore, one of the classical arguments for municipal amalgamation, achieving economies of scale, can only be applied at a limited scale. This does not imply that more extensive amalgamation is not warranted, but it demands that other arguments justifying municipal amalgamation should be presented.  </p>

scholarly journals Economies of Scale in Local Government Services: A Meta Analysis

2020 ◽  
Vol 3 (1) ◽  
pp. 1
Author(s):  
Siew King Ting ◽  
Rene Villano ◽  
Brian Dollery
Keyword(s):  
Regression Analysis ◽  
Local Government ◽  
Economies Of Scale ◽  
Scale Effects ◽  
Meta Analysis ◽  
Empirical Studies ◽  
Structural Reform ◽  
Government Services ◽  
Meta Regression ◽  
Meta Regression Analysis

In this paper, a meta-regression analysis is presented by 38 empirical studies on the size of scale in various local government services. Our results show that income classification was the most important factor in determining size of scale and all selected local government services recorded decreasing size of scale in the recent decades, with water services exhibiting the largest decreasing size of scale. The existence of scale effects has important ramifications for local government structural reform, given the globally indifferent results of local government reorganization.

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