The political economy of municipal consortia and municipal mergers

  • Giuseppe Di Liddo
  • Michele G. GiurannoEmail author
Original Paper


This paper analyses both the policy and welfare consequences of municipal mergers vs municipal consortia in the presence of spillovers and inequalities in the districts size. Citizens of different municipalities have a common interest in internalising spillovers, but conflicting interests on how to reach that goal. We address the question of when, from a welfare point of view, the central government should legislate in favour of municipal mergers and when, instead, it should prefer municipal consortia. Results provide some useful insights for the design of local governments reforms.


Municipal amalgamation Municipal cooperation Centralization Bargaining 

JEL Classification

H73 H77 H41 



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Authors and Affiliations

  1. 1.Department of Economics, Management and Business LawUniversity of Bari “A. Moro”BariItaly
  2. 2.Department of Economics and ManagementUniversity of SalentoLecceItaly

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