On the Optimal Size of Local Jurisdictions: New Evidence from Italian Provinces

33 Pages Posted: 17 Nov 2011

See all articles by Guglielmo Barone

Guglielmo Barone

University of Bologna - Department of Economics

Date Written: September 23, 2011

Abstract

This paper examines the creation of some new provinces in Italy in the 1990s to assess whether the reduction in the size of the local jurisdiction led to benefits in terms of local development, human capital and road quality, which are three public goods provided by the Italian provinces in tandem with other levels of government. By employing a difference-in-differences empirical strategy, and comparing the municipalities belonging to the new provinces (treatments) with other comparable municipalities (controls), I show that the reduction of the size of a province did not generate any benefits in terms of the outcome variables. This result is robust to a number of checks, including the definition of treatment and different functional specifications.

Note: Downloadable document is in Italian.

Keywords: local government, difference-in-differences

JEL Classification: D24, H11, H26, H72

Suggested Citation

Barone, Guglielmo, On the Optimal Size of Local Jurisdictions: New Evidence from Italian Provinces (September 23, 2011). Bank of Italy Temi di Discussione (Working Paper) No. 823, Available at SSRN: https://ssrn.com/abstract=1960987 or http://dx.doi.org/10.2139/ssrn.1960987

Guglielmo Barone (Contact Author)

University of Bologna - Department of Economics ( email )

Bologna
Italy

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