Working Paper: CEPR ID: DP15999
Authors: Clemence Tricaud
Abstract: This paper provides new evidence on why municipalities are often reluctant to integrate. Exploiting a French reform that made intermunicipal cooperation mandatory, I find that urban municipalities forced to integrate experienced a large increase in construction, consistent with NIMBYism explaining their resistance, while rural municipalities ended up with fewer local public services. I do not find the same effects for municipalities that had voluntarily integrated prior to the law, while both types of municipality enjoyed similar benefits in terms of public transport and fiscal revenues. These findings support the fact that municipalities resisted to avoid the local costs of integration.
Keywords: local governments; intermunicipal cooperation; difference-in-differences; housing regulations; local public services
JEL Codes: H70; R52; R53
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Forced integration (F02) | Increase in building permits (L74) |
| Forced integration (F02) | Decrease in daycare spots (J13) |
| Forced integration (F02) | Decrease in public libraries (H49) |
| Voluntary integration (F15) | No increase in construction (L74) |
| Forced integration (F02) | No significant changes in housing prices (R31) |
| Forced integration (F02) | No significant changes in economic activity (E39) |