Political entrepreneurship and the formation of special districts

Abstract

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.

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Fig. 1

Notes

  1. 1.

    There were also 14,561 school districts, which is also a type of special purpose government though this type is usually placed in a distinct category of government.

  2. 2.

    As based on our calculations from data in US Bureau of the Census (2007).

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Acknowledgments

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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Correspondence to Richard E. Wagner.

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Fink, A., Wagner, R.E. Political entrepreneurship and the formation of special districts. Eur J Law Econ 35, 427–439 (2013). https://doi.org/10.1007/s10657-010-9216-5

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Keywords

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

JEL Classification

  • D72
  • H11
  • H71
  • L32