Municipal Mergers and Local Government Expenditure in Japan: Panel Analysis of Scale Effect and Secular Change

• HIROTA Haruaki

  Faculty of Commerce, Nagoya University of Commerce and Business

• YUNOUE Hideo

  School of Economics, University of Hyogo

Bibliographic Information

Other Title

• 平成の大合併と歳出削減
• 平成の大合併と歳出削減 : 規模の経済性と合併後の経過年数に関するパネルデータ分析
• ヘイセイ ノ ダイ ガッペイ ト サイシュツ サクゲン : キボ ノ ケイザイセイ ト ガッペイ ゴ ノ ケイカ ネンスウ ニ カンスル パネルデータ ブンセキ
• ──規模の経済性と合併後の経過年数に関するパネルデータ分析──

Abstract

The number of municipalities in Japan has decreased from 3,232 in 1999 to 1,820 in 2006 because of municipal mergers, called Heisei-no-Daigappei. The previous works on municipal mergers reported that the scale effect of expenditures (a U shaped per capita expenditure curve) are observed in Japan, and concluded that it might be achieved the reduction of expenditure by municipal mergers. However there are few researches to analyze the expenditure changes in Heisei-no-Daigappei. This paper estimates the scale effect of expenditures and the effects of municipal mergers in Japan’s local public expenditure. In order to consider the expenditure of municipal mergers, our new approach is to apply unique index called financial index classified by similar types.<br>First, the expenditure structure is found to be an “inverse” U shaped in our estimation using fixed effect panel analysis on Japanese municipalities. The U shape which has been observed in previous works seems to be the fixed effect. The U shape on previous works might be caused by the miss specification or omitted variable problem. Second, we mainly found out that municipalities achieved reductions in their total expenditures with mergers, and the pace of reduction would be diminished after the elapse of a certain period of time. According to our results, the expenditure of merged municipality declined about 7.8% in the first year, and the reduction rate became about 11% in a few year after the merged year. <br><br>JEL Classifications: H77, H11, H72

Journal

• Studies in Regional Science

  Studies in Regional Science 43 (3), 325-340, 2013

  JAPAN SECTION OF THE REGIONAL SCIENCE ASSOCIATION INTERNATIONAL

Keywords

• Municipal Mergers
• Scale Effect
• Local Government Expenditure

Details

• CRID: 1390001204433156096
• NII Article ID: 130004713343
• NII Book ID: AN00140630
• DOI: 10.2457/srs.43.325
• ISSN: 18806465
• ISSN: 02876256
• NDL BIB ID: 025552989
• Web Site: https://ndlsearch.ndl.go.jp/books/R000000004-I025552989
• Text Lang: ja
• Data Source:
  • JaLC
  • NDL
  • Crossref
  • CiNii Articles
  • KAKEN
• Abstract License Flag: Disallowed