Exploiting the common pool or looking to the future?

A study of free-riding leading up to the 2007 municipal amalgamations in Denmark

Research output: Contribution to journalJournal articleResearchpeer-review

Abstract

Municipal amalgamations can create incentives for opportunistic behaviour. Several fairly recent studies have examined this on amalgamations in Denmark and Sweden using the so-called law of 1 over n. However, they have yielded inconclusive results and I argue that one plausible explanation is a theoretical deficiency in the law, as it does not account for how future political representation can mitigate the incentive to free-ride. I examine this using largescale amalgamations in Denmark in 2007. This case is quite unique as the amalgamations were implemented in such a manner that they constitute a quasi-experiment, and because an extra fiscal year was added to the election period where the composition of the new councils was known with certainty, while the municipalities retained some decision-making power. The study’s findings are consistent with the argument that the incentive to free-ride depends on the decision makers’ future political stake in the new, amalgamated municipality.
Original languageEnglish
JournalLocal Government Studies
Volume45
Issue number5
Pages (from-to)676-696
ISSN0300-3930
DOIs
Publication statusPublished - 2019

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Denmark
incentive
municipality
Law
election
decision maker
Sweden
decision making
experiment
decision

Keywords

  • amalgamations
  • law of 1 over n
  • Local government
  • public spending
  • re-election

Cite this

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title = "Exploiting the common pool or looking to the future?: A study of free-riding leading up to the 2007 municipal amalgamations in Denmark",
abstract = "Municipal amalgamations can create incentives for opportunistic behaviour. Several fairly recent studies have examined this on amalgamations in Denmark and Sweden using the so-called law of 1 over n. However, they have yielded inconclusive results and I argue that one plausible explanation is a theoretical deficiency in the law, as it does not account for how future political representation can mitigate the incentive to free-ride. I examine this using largescale amalgamations in Denmark in 2007. This case is quite unique as the amalgamations were implemented in such a manner that they constitute a quasi-experiment, and because an extra fiscal year was added to the election period where the composition of the new councils was known with certainty, while the municipalities retained some decision-making power. The study’s findings are consistent with the argument that the incentive to free-ride depends on the decision makers’ future political stake in the new, amalgamated municipality.",
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Exploiting the common pool or looking to the future? A study of free-riding leading up to the 2007 municipal amalgamations in Denmark. / Hansen, Sune Welling.

In: Local Government Studies, Vol. 45, No. 5, 2019, p. 676-696.

Research output: Contribution to journalJournal articleResearchpeer-review

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AB - Municipal amalgamations can create incentives for opportunistic behaviour. Several fairly recent studies have examined this on amalgamations in Denmark and Sweden using the so-called law of 1 over n. However, they have yielded inconclusive results and I argue that one plausible explanation is a theoretical deficiency in the law, as it does not account for how future political representation can mitigate the incentive to free-ride. I examine this using largescale amalgamations in Denmark in 2007. This case is quite unique as the amalgamations were implemented in such a manner that they constitute a quasi-experiment, and because an extra fiscal year was added to the election period where the composition of the new councils was known with certainty, while the municipalities retained some decision-making power. The study’s findings are consistent with the argument that the incentive to free-ride depends on the decision makers’ future political stake in the new, amalgamated municipality.

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