Performance budgeting schemes in the public sector have to operate with imperfect performance measures. We argue that these imperfections lead to wasteful fund-seeking (window dressing and lobbying) by the administrative units that produce public services. We develop a game-theoretical model to...

Performance budgeting schemes in the public sector have to operate with imperfect performance measures. We argue that these imperfections generate incentives for the potential recipients of performance-based funds to use up resources in socially wasteful influence activities. We develop a...

The paper addresses the welfare implications of conditional grants if government failure leads to inefficiencies in the production of regional public goods and services. Conditional grants may improve welfare by setting incentives for regions to improve efficiency. At the same time, resources...

In rural areas, small and medium-sized municipalities are challenged by demographic change and intensified competition for capital and high-skilled labor. Inter-municipal cooperation (IMC) is often regarded as a significant element of a strategy to meet these challenges. Based on a survey in...

Inter-municipal cooperation (IMC) is promoted as a way in which small, fiscally weak munic-ipalities can cope with intensified interregional competition and demographic change. We pro-vide first evidence on citizens' support for IMC using survey data from rural Germany. We cover different fields...

We analyze data from a survey among local council members in 59 German municipali-ties. We ask council members whether their home municipality should cooperate with neigh-boring municipalities in the provision of public services like childcare or road maintenance. Their answers are clearly...

We want to find out whether grants-in-aid help the recipient government to get re-elected. We take Poland as our testing ground and analyze the impact of EU funds spent within a municipality on mayoral elections in 2010 and 2014. We employ an instrumental variables approach to account for the...

We analyze the factors driving the emergence of inter-municipal cooperation (IMC) in tasks of internal administration in West-Germany between 2001 and 2014. In line with the Institutional Collective Action Approach, we find similarities in political ideology to foster cooperation. Cost pressure...

An increasing number of municipalities cooperates in the field of economic development. In this paper, we focus on a specific instrument in this field, namely the development of joint business parks. We apply a hazard model to data from West-German municipalities between 2000 and 2015. We find...

This paper aims at testing whether inter-municipal cooperation (IMC) in policies to promote local business development has a positive impact on local economic performance. We apply two-way fixed effects as well as marginal structural models to a panel data set covering 1,849 Polish...