Local Government Fragmentation

For decades a debate has lingered about the ramifications of local government fragmentation, and the arguments traditionally are based on political ideologies and impressionistic views rather than on empirical analysis. In this empirical study, a fiscal perspective is added to the issue. A fragmentation measure, based on the dispersion of expenditures among local governments, is used to examine the relationship between fragmentation and the cost of government in Illinois, including the very fragmented Chicago metropolitan region. The results indicate a significant positive relationship between fragmentation and the cost of government.