Metropolitan Fragmentation and Decentralized Control of Revenue Resources

Abstract

There seems to be an inescapable conflict between one group of individuals who maintain that multiple local governments are necessary for allocational efficiency, and another group who maintain that fragmentation of local government necessarily leads to an inequitable allocation of resources among income classes. It is the purpose of this note to clarify, if not resolve this conflict by pointing out that the allocational advantages of metropolitan fragmentation derive from one function of local government, while the redistributional disadvantages derive largely from a different function. It is theoretically possible, therefore, to have a just and efficient organization of metropolitan government by centralizing one function of local government.