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The Effect of Inter-municipal Cooperation on Local Business Development in German Municipalities

Author

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  • Eva Wolfschuetz

    (University of Kassel)

Abstract

Does inter-municipal cooperation (IMC) enhance municipal economic performance? This study employs marginal structural models to address selection into treatment and time-dependent confounding to estimate the effectiveness of IMC in the field of local business development. I use data on municipalities in four West-German states, Lower Saxony, Hesse, Rhineland Palatinate, and Bavaria during the years 2008-2015. I find that, over time, IMC has a positive effect on local economic performance and local business development resources are spent more productively in cooperating municipalities.

Suggested Citation

  • Eva Wolfschuetz, 2020. "The Effect of Inter-municipal Cooperation on Local Business Development in German Municipalities," MAGKS Papers on Economics 202005, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    • Handle: RePEc:mar:magkse:202005
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    File URL: http://www.uni-marburg.de/fb02/makro/forschung/magkspapers/paper_2020/05-2020_wolfschuetz.pdf
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    References listed on IDEAS

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    1. Frederic Blaeschke, 2014. "What drives small municipalities to cooperate? Evidence from Hessian municipalities," MAGKS Papers on Economics 201414, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    2. Quentin Frère & Matthieu Leprince & Sonia Paty, 2014. "The Impact of Intermunicipal Cooperation on Local Public Spending," Urban Studies, Urban Studies Journal Limited, vol. 51(8), pages 1741-1760, June.
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    4. Germa Bel & Anton Costas, 2006. "Do Public Sector Reforms Get Rusty? Local Privatization in Spain," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 9(1), pages 1-24.
    5. Ivo Bischoff & Simon Melch & Eva Wolfschuetz, 2019. "Does tax competition drive cooperation in local economic development policies? Evidence on inter-local business parks in Germany," MAGKS Papers on Economics 201906, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    6. Germà Bel & Mildred E. Warner, 2016. "Factors explaining inter-municipal cooperation in service delivery: a meta-regression analysis," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 19(2), pages 91-115, April.
    7. Massimiliano Ferraresi & Giuseppe Migali & Leonzio Rizzo, 2018. "Does intermunicipal cooperation promote efficiency gains? Evidence from Italian municipal unions," Journal of Regional Science, Wiley Blackwell, vol. 58(5), pages 1017-1044, November.
    8. Ivo Bischoff & Eva Wolfschütz, 2021. "Inter-municipal cooperation in administrative tasks – the role of population dynamics and elections," Local Government Studies, Taylor & Francis Journals, vol. 47(4), pages 568-592, July.
    9. Hyung Jun Park & Richard C. Feiock, 2006. "Institutional Collective Action, Social Capital and Regional Development Partnership," International Review of Public Administration, Taylor & Francis Journals, vol. 11(2), pages 57-69, January.
    10. Hiroki Baba & Yasushi Asami, 2020. "Municipal population size and the benefits of inter-municipal cooperation: panel data evidence from Japan," Local Government Studies, Taylor & Francis Journals, vol. 46(3), pages 371-393, May.
    11. Christopher V. Hawkins, 2017. "Political incentives and transaction costs of collaboration among US cities for economic development," Local Government Studies, Taylor & Francis Journals, vol. 43(5), pages 752-775, September.
    12. Kosuke Imai & Marc Ratkovic, 2015. "Robust Estimation of Inverse Probability Weights for Marginal Structural Models," Journal of the American Statistical Association, Taylor & Francis Journals, vol. 110(511), pages 1013-1023, September.
    13. E. Dijkgraaf & R. H. J. M. Gradus, 2013. "Cost advantage cooperations larger than private waste collectors," Applied Economics Letters, Taylor & Francis Journals, vol. 20(7), pages 702-705, May.
    14. Germà Bel & Mildred E. Warner, 2016. "Factors explaining inter-municipal cooperation in service delivery: a meta-regression analysis," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 19(2), pages 91-115, June.
    15. Matthew Blackwell, 2013. "A Framework for Dynamic Causal Inference in Political Science," American Journal of Political Science, John Wiley & Sons, vol. 57(2), pages 504-520, April.
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    1. repec:hal:journl:hal-04799406 is not listed on IDEAS
    2. Lionel WILNER, 2020. "How do citizens perceive centralization reforms? Evidence from the merger of French regions," Working Papers 2020-20, Center for Research in Economics and Statistics, revised 07 Jun 2021.

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    More about this item

    Keywords

    Inter-municipal cooperation; economic development; marginal structural models; Germany;
    All these keywords.

    JEL classification:

    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O22 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Project Analysis
    • D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation

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