Bulletin n. 2/2011
October 2011
CONTENTS
  • Section A) The theory and practise of the federal states and multi-level systems of government
  • Section B) Global governance and international organizations
  • Section C) Regional integration processes
  • Section D) Federalism as a political idea
  • Bartolini David, Fiorillo Fabio
    Cooperation among Local Councils for the Provision of Public Goods
    in Rivista italiana degli economisti , 1, aprile 2011 ,  2011 ,  pp. 85-108
    In order to provide local public goods, municipalities can cooperate and exploit economies of scale and scope. We present an analytical model of the costs and benefits of two such forms of cooperation: Consortia and Unions. We find that the efficiency of these two forms of cooperation depends on the number of participants, the transaction costs, and most importantly the type of local public good. In particular, the elasticity of substitution among the services pertaining to a particular public good plays a decisive role. For services with a high elasticity of substitution the Union performs better than the Consortium, and vice versa. This provides a guidance for the decision on which institution provides what public good.
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