European Journal of Law and Economics

, Volume 35, Issue 3, pp 427–439 | Cite as

Political entrepreneurship and the formation of special districts

  • Alexander Fink
  • Richard E. WagnerEmail author


Where general purpose governments provide a bundle of services within their boundaries, special district governments provide specific services inside the boundaries of general purpose governments. The alternative to forming a special purpose government is providing the service within a general purpose government. Formation of a special district represents the establishment of a new political enterprise, in contrast to the addition of a new product line to an existing government. We explore the formation of special districts as a particular form of the universal entrepreneurial search for gain or profit from exchange. Political entrepreneurship, like market entrepreneurship, operates inside some framework of rules, and the formation of special districts reflects the search for political gain within that framework of rules. We use an entrepreneurial framework to formulate several hypotheses concerning the formation and organization of special districts.


Special districts Political entrepreneurship Public enterprise Public–private interaction Enterprise-based public finance Constitutional political economy 

JEL Classification

D72 H11 H71 L32 



We are grateful to the participants of the Public Choice Society Meetings 2010 in Monterey, CA, and two anonymous referees for helpful suggestions.


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Copyright information

© Springer Science+Business Media, LLC 2010

Authors and Affiliations

  1. 1.Department of EconomicsGeorge Mason UniversityFairfaxUSA

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