Citizens’ Trade-offs in State Merger Decisions: Evidence from a Randomized Survey Experiment

54 Pages Posted: 10 Dec 2019

See all articles by Sebastian Blesse

Sebastian Blesse

ZEW – Leibniz Centre for European Economic Research

Friedrich Heinemann

ZEW – Leibniz Centre for European Economic Research; University of Heidelberg - Alfred Weber Institute for Economics

Date Written: November 2019

Abstract

Voters dealing with jurisdictional merger decisions face a trade-off between economies of scale and preference costs. Larger jurisdictions may offer cost advantages, yet the downside is that policies in larger units may be less aligned to voter preferences. Our study is the first to provide evidence on this trade-off on the individual level in an experimental set-up. For this purpose, we designed a randomized survey experiment and inquired about preferences on state mergers on a representative sample of the German population. In line with the decentralization theorem, the support for mergers increases with cost savings and falls with preference costs measured as political alignment, respectively. The effects of the cost treatments on merger support are lower for respondents from states that are actually discussed as merger candidates. Effects are also weaker for citizens who have a positive view of their own political participation under the status quo.

Keywords: state-level mergers, optimal design of federations, economies of scale, political representation, survey experiment, decentralization theorem

JEL Classification: H11, H77

Suggested Citation

Blesse, Sebastian and Heinemann, Friedrich, Citizens’ Trade-offs in State Merger Decisions: Evidence from a Randomized Survey Experiment (November 2019). ZEW - Centre for European Economic Research Discussion Paper No. 19-054, Available at SSRN: https://ssrn.com/abstract=3500729 or http://dx.doi.org/10.2139/ssrn.3500729

Sebastian Blesse (Contact Author)

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

Friedrich Heinemann

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

HOME PAGE: http://www.zew.de

University of Heidelberg - Alfred Weber Institute for Economics ( email )

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Heidelberg, D-69117
Germany

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