Territorial reforms in Europe: effects on administrative performance and democratic participation

ABSTRACT

Territorial reform is the most radical and contested reorganisation of local government. A sound evaluation of the outcome of such reforms is hence an important step to ensure the legitimation of any decision on the subject. However, in our view the discourse on the subject appears to be one sided, focusing primarily on overall fiscal effects scrutinised by economists. The contribution of this paper is hence threefold: Firstly, we provide an overview off territorial reforms in Europe, with a special focus on Eastern Germany as a promising case for cross-country comparisons. Secondly, we provide an overview of the analytical classifications of these reforms and context factors to be considered in their evaluation. And thirdly, we analyse the literature on qualitative performance effects of these reforms. The results show that territorial reforms have a significant positive impact on functional performance, while the effects on participation and integration are indeed ambivalent. In doing so, we provide substantial arguments for a broader, more inclusive discussion on the success of territorial reforms.

KEYWORDS:

• Municipal amalgamation effects
• territorial reform
• municipal mergers
• local government performance
• administrative reforms

1. Introduction

Territorial reforms are the most radical and contested reorganisation of the subnational administration. The academic interest for this phenomenon is substantial. However, a cleavage divides the literature dealing with the issue: In a first strand, economists provide primarily quantitative ex-post analysis of such reform ventures.¹ As a matter of research design and method applied, this work more than often focuses on selected financial aspects as reform outputs. Mostly, a narrow focus on economies of scale is chosen, defined as budget cuts or tax reductions. From an economist’s perspective, spending per capita (in total or in certain policy fields) seems probably the most salient variable to look at. For most citizens and the administrative ‘boots on the ground’ this perspective is secondary. Questions of availability and quality of services can easily mobilise considerable shares of a population – the outlook for a smallish tax reduction will not. While the overall findings in this cost-centred debate are still inconclusive (Holzer 2009), a predominantly critical connotation characterises many of these economies of scale-centred publications (c.f. Allers and Geertsema 2016, 660). These often meticulously conducted quantitative ex-post analyses became highly visible in recent years, as their approach fits the call for generalizability better than in depth case studies do. We highly appreciate these studies, as they are instructive and inspiring to the community. However, we consider the state of the debate as unbalanced at least. We suspect that much of this research as based on a misconception on the motives and potentials of the reforms analysed.

Consequently, this paper sets out to promote a second strand of literature: Public administration scholars and other more empirically oriented disciplines (geographers, political scientists, demographers etc.) are often directly engaged in consulting, developing and evaluating politically driven amalgamation projects.² In their work, they use a broad spectre of theories and methods. We would like to bring forward these more comprehensive and holistic approaches concentrating on the impact dimensions of effectiveness, quality of services and participation. To do so, we first provide an overview off territorial reforms in Europe, with a special focus on Eastern Germany as a promising case for cross-country comparison. Secondly, we outline analytical classifications for these reforms and propose context factors to be considered in their evaluation. By analysing the literature on qualitative performance effects of these reforms, we thirdly provide substantial arguments for a broader, more inclusive discussion of territorial reforms’ success. We close with a discussion of the very different reform appraisals and their merits.

2. Territorial reforms in Europe and Germany

2.1 European context

Since the 1970s, territorial reforms have been dealing mainly with ‘up-scaling’, namely the establishment of bigger units. As a result, in the past decades (1973–2013) the number of municipalities across several European countries declined. The most significant decrease can be observed in Greece (−94%) and in Belgium (−75%) (Steiner, Kaiser, and Eythórsson 2016; 28ff.; see also Table 1). In other countries, such as Iceland, Denmark and the Netherlands, the number of municipalities declined by more than half.

Table 1. Difference in the number of municipalities in Europe between 1973 and 2013 in %.

Northern Europe		Southern Europe
Norway	−3.4	Slovenia	+ 44.2
Finland	−33.7	Portugal	+ 1.3
Sweden	−37.5	Spain	+ 0.8
Denmark	−64.4	Italy	+ 0.4
Iceland	−67.0	Greece	−94.6
Western Europe		Eastern Europe
Switzerland	−22.6	Poland	+ 4.8
Germany	−25.4
Netherlands	−55.3
Belgium	−75.0
Overall average		−29.3

Source: Steiner, Kaiser, and Eythórsson 2016, 29.

Table 2. Outcome of territorial reforms in East German states.

	Outcome of municipal-level territorial reform			Outcome of county-level territorial reform
Land	Number of municipalities 1990	Number of municipalities 2015	Decrease (in %)	Number of counties 1990	Number of counties 2016	Decrease (in %)
Saxony-Anhalt	1349	218	84	31	6	80
Brandenburg	1775	418	76	48	14	70
Saxony	1623	430	74	37	11	70
Thuringia	1707	849	50	38	14	63
Mecklenb.-West Pom.	1117	783	30	35	17	51

Source: Bogumil 2016, 24, updated.

Two remarkable examples shall be singled out from the countries observed. During the most recent territorial reform of 2007 in Denmark, the number of municipalities (kommuner) declined from 271 to 98 and the 14 counties (amter) were fused into five regions. The newly established municipalities count on average around 55,400 inhabitants. Among the southern European countries, the case of Greece is similarly striking. During the two reform waves of the 1990s and 2000s (Capodistria reform in 1998 and Kallikratis reform in 2010), the number of municipalities was reduced from originally 5800 to 325, increasing the population to up to 33,600 inhabitants on average (Hlepas 2010, 233ff.; 2016). In so doing, Greece came closer to the so-called North European reform type (cf. Kuhlmann and Wollmann 2014, 156; Kuhlmann and Bouckaert 2016, 18). Similar developments can be observed in Bulgaria (Vodenicharov 2012, 70ff.) and Lithuania (cf. Saparniene and Lazauskiene 2012, 389ff.). Along with England and Denmark, these two countries feature the most populous municipalities in Europe. Only in few countries, the number of municipalities increased in the last decade (i.e. Slovenia, Poland, Spain). After all, municipalities in European countries still show significant differences in size and population. For example, the average size spans from 1640 to 139,000 km², while the amount of municipalities with less than 5000 inhabitants ranges between the 96 and 2 per cent (and even 0 per cent).

In many countries, over the past 40 years a trend to consolidate local governments in Europe has become evident (cf. also Kuhlmann and Wollmann 2014, 150ff.). The phenomenon concerns not only countries of the northern European group (Denmark, Sweden, the United Kingdom, and some German Länder) typically operating with up-scaling strategies, but also southern and eastern European countries (i.e. Greece, Bulgaria, Lithuania). Rather than precluding intermunicipal cooperation (‘transscaling’; Baldersheim and Rose 2010; Hulst and van Montfort 2007; Franzke, Klimovský, and Pinterič 2016), this trend often parallels it. However, a second group of countries still classify into the southern European reform type (France, Italy, several CEE countries). These countries maintained the historical, fragmented communal structure as reform initiatives are voluntary. In support of the small communities a layer of intercommunal associations was set up. Despite showing a common, converging ‘southern European’ pattern of territorial change, these countries also figure significant differences in the average municipal size (i.e. with 1720 inhabitants in France and 7250 in Italy).

2.2 East German Länder as (unvoluntary) experimental field for territorial reform

The reformative activity in Germany’s Länder is twofold (Bogumil and Ebinger 2011). In the West, since the big reforms of the 1970s, territorial reforms at municipal level have been sporadic and almost only voluntary. In the so-called ‘new’ federal states in the East, a cascade of territorial reforms succeeded since the early 1990s (see Table 2). This extraordinary 20 years-long reform history provides a formidable laboratory to study all aspects of territorial reforms in a comparative perspective. The need to ‘amalgamate in these Länder derives from the fact that after the reunification the newly established municipalities were organised into small-scale units. This led to two related issues. Firstly, these small units could not live up to the demands of the growing portfolio of tasks emerging at the local level – let alone those tasks to be transferred from state administration (c.f. Ebinger, Grohs, and Reiter 2011). Secondly, the eastern German Länder were confronted with a socio-economic disaster following the reunification: the collapse of the industrial core along with the evaporation of the economic and fiscal strength of entire regions, massive emigration und demographic imbalance. Set against this background, the pressure to (re)build a functional, efficient communal self-government was particularly high, leading to a first wave of consolidation in mid-1990s. However, the overall socio-economic situation and the debt cap induced by the EU aggravated the budget constraints. A second wave of territorial reforms was induced between 2007 and 2011 in Saxony, Saxony-Anhalt and in Mecklenburg-West Pomerania. This strong reform momentum has come to a halt with the current reform attempts in the Länder Brandenburg and Thuringia. The foreseeable failure of these last two reforms initiatives in 2017 indicates changing winds concerning the reform climate. The authors attribute this to the juxtaposition of political and public discourse to the possible effects of costs saving (‘economies’). While the early reforms were often carried out by reform coalitions striving for administrative sustainability and competitiveness of their region, the new deliberations alone have become the plaything of political confrontation.

The situation of the Land Brandenburg is exemplary: The population will shrink by about 10% until 2030 and the average age will rise further, while the population density will develop more and more asymmetrically as a function of the distance to Berlin (Landesamt für Bauen und Verkehr 2012). Consequently, maintaining infrastructure and services will become a challenge in most part of the country. The cross-party study commission set up in preparation for the reform of the administrative structure came to the conclusion that a territorial reform at county level is indispensable. (SPD/DIE LINKE Brandenburg 2013; cf. Bogumil and Ebinger 2012).

While the appraisals were similar across eastern Germany, the set off reform ventures (cf. Bogumil 2016, 23ff.) vary considerably concerning drivers (big or small coalition), scope (only county level or municipal – though with time offset), target figures set, actual territorial changes achieved as well as the related devolution process.

In Saxony-Anhalt, a territorial reform was executed both on county and municipal level. Following the first county-level territorial reform of 1994, the Land Parliament introduced further changes in 2007 under the auspices of CDU and SPD. The number of counties was reduced from 21 to 11 with 153,000 inhabitants on average (ranging from 86,000 to 223,000 in 2015) and a surface extending between 1400 km² and 2400 km². The three county-free cities were maintained. On the municipal level, two reforms succeeded in 2004 and 2011. By amalgamation, the number of municipalities decreased by more than 80 per cent, from 1,300 (2003) to 218 (2015), counting 11,000 inhabitants on average. Organisation-wise, the ‘double-decker’ model of two full-fledged local levels (local congregations and municipal associations) with complementing responsibilities was introduced in Saxony-Anhalt (Kuhlmann and Wollmann 2014, 166ff.; Kuhlmann et al. 2012; 14ff.).

Similarly, Saxony implemented territorial reforms both on municipal and county level. After the first territorial reform on county level in 1994–1996 and on municipal level in 1998, CDU and SPD approved another reform in 2008. The remaining 22 counties were brought down to 10 and the seven county-free cities to three. The 10 counties inhabited between 200,000 and 355,000 citizens in 2012. The size of the counties stretches between 1400 and 2400 km², with the exception of one counting 950 km². On the municipal level, the number of units declined by voluntarily amalgamation from originally 1626 in 1990 to 540 in the first territorial reform of 1998, finally amounting to 426 as of today, while the average number of inhabitants increased to 9500.

Mecklenburg-West Pomerania introduced the first county-level territorial reform in 1994. A further reformative attempt in 2007 was thwarted by the countries constitutional court (Bogumil and Ebinger 2008b). However, in 2011 the Parliament finally approved a reform with the support of CDU and SPD (Landesregierung Mecklenburg-Vorpommern, 2015). The 12 counties merged to six and the six county-free cities to two. The surface of these new counties covers between 2100 and 5400 km², corresponding to the biggest county in all of Germany (cf. Hammerschmid et al. 2015). The population varied between 156,000 and 264,000 in 2012, with an average of 217,000. Mecklenburg-West Pomerania has not carried out any territorial reform at municipal level, yet.

The Parliament of Brandenburg agreed in July 2016 on a blue print for structural reform of the administration in 2019 at hands of the parties SPD and Die Linke (The Left). The reform envisaged a population of at least 175,000 inhabitants in the counties and 150,000 in county-free cities for 2030 (Landtag Brandenburg 2016; cf. Bogumil and Ebinger 2012; Bogumil, Kintzinger, and Mehde 2014; SPD/DIE LINKE Brandenburg 2013). A first scientifically backed proposal, calling for bringing down the 14 counties to 9 and from four county-free cities to one (Potsdam) (cf. MIK 2016), met strong opposition. Against the reservations of the parliament’s study commission, the Ministry of the Interior of the Land Brandenburg felt urged to devise a watered-down solution counting 11 counties. However, because of persisting opposition, the county-level territorial reform has been finally discarded in November 2017.

In Thuringia, following the first territorial reform at county level in 1994, Die Linke, SPD and greens approved in 2016 a blue print and an interim law for an administrative, functional and territorial reform (Landesregierung Thüringen 2016). The territorial reform envisaged the decrease of the municipalities from 850 to 200, the 17 counties ought to merge to 8, striving to achieve a minimum population of 130,000 inhabitants at county level and 6000 at municipal level. Of the six county-free cities only Erfurt and Jena (with more than 100.000 inhabitants) should maintain their status (Bogumil 2016). Still, the reformative plans of the Land government met strong resistance from the opposition and the communal arena; furthermore, a negative judgement of the constitutional court declared invalid the ratification of the interim law into reform because of formal reasons. As a result, the government abandoned the project on 30 November 2017.

3. Analytical approaches to territorial reforms

3.1 Classification of reform approaches

The substantial differences across reform approaches shown in the previous sections can be synthetized into four categories:

Level in consideration: While some European countries comprise a local system made up of several tiers with roughly a municipal level and a county level above it, others only feature a single tier. The territorial reforms in the former group of countries can concern either the lower or the higher level as well as both.³ The experience in the East German states shows that in two-tier systems reforms are generally required on both levels. Nevertheless, reforms on the county level appear to be more urgent.

Reform approach: The territorial reforms in Europe can be grouped into two types (see Kuhlmann and Wollmann 2014, 150ff.). The first one is a rather ’soft‘ type, insofar as it concerns mainly administrative cooperation and resource pooling (so-called trans-scaling, i.e. in France, Italy, Spain, southern Germany). The second, ’hard‘ version consists in territorial amalgamation and municipal association (so-called up-scaling, i.e. in Great Britain, Scandinavia, northern Germany and parts of the East; cf. Baldersheim and Rose 2010, 20), aimed at enhancing the administrative performance of the municipalities by economies of scale (cf. John 2010, 106ff. for the United Kingdom).

Scope: The scope of the reforms can be comprehensive or partial (Baldersheim and Rose 2010, 13ff.). Comprehensive amalgamations refer to the territorial structure of the municipalities of a Land (or a Federal state) as a whole, whereas partial territorial reforms concerns specific subregions or municipalities. Comprehensive territorial reforms succeeded in Belgium, Denmark, Iceland, and Sweden as well as occasionally in some German Länder. In contrast, partial approaches evolved in Norway, Steiermark in Austria, and in the majority of the Swiss cantons (Steiner, Kaiser, and Eythórsson 2016, 30ff.).

Implementation strategy: The scope of territorial reforms is usually a function of the implementation strategy chosen. Baldersheim and Rose (2010, 13ff.) propose a differentiation between bottom-up and top-down strategies. Bottom-up amalgamations are grounded on the principle of voluntary association of municipalities, which also generally act as promoters. Top-down amalgamations are mostly compulsory or forced associations, prompted by higher government levels and enforced by law (eventually even against the will of the municipalities in question). Following this dimension as the basis for comparative analysis of territorial reforms in Europe, it appears that top-down strategies are pursued especially in Denmark, Finland, Greece and Sweden. Belgium and the Netherlands also belong to this category, while in Germany it only applies to some Länder (e.g. North Rhine-Westphalia, Hesse, Brandenburg, Saxony) (Steiner, Kaiser, and Eythórsson 2016, 27ff.). Instead, the bottom-up strategy affects mainly Norway but it can be found in Switzerland and in Thuringia, too.

German speaking countries often develop hybrid types of these implementation strategies or some mitigated form of the top-down approach, rolled out in stages: After exhaustive discussion of target structures with all stakeholders at a conceptual stage, local authorities are offered ad hoc reform-incentives (so-called ‘marriage bonus’) during a voluntary stage. In accepting these offers, local governments can chose partners within a given target structure and avoid forceful amalgamation in a final, compulsory reform stage. Such layered processes had been deployed already in the 1970s and have been applied recently in Saxony-Anhalt (Saxony-Anhalt 2008), Rheinland-Pfalz and Steiermark, Austria (Steiermark 2013).

3.2 Contextual factors for the success of the reform

Besides territorial shifts, a number of other factors (which can also be specific to the Land or region) influence the reform effects. As a consequence, the impact of ‘upscaling’ on the overall performance is difficult to distinguish.

As all political processes, administrative reform policy and even more so territorial policy is not a straight forward rational process but also – and especially – a power driven exercise (Sabatier 1991; Bogumil and Ebinger 2008a; Ebinger and Bogumil 2016). The following factors appear to be particularly important to explain impact and results of the reforms, especially in international comparative perspective:

• Administrative system and culture of the Land or region in question. Amalgamations in one Land do not automatically lead to the same effects in another Land;

• Initial status of the territory before the reform, especially size, number of participant municipalities, type of association (Merger vs. Amalgamation), and reforms already occurred in the past. Firstly, amalgamations can trigger follow-up investments and professionalisation inputs in the administration, which exceed the eventual gain in economies. Secondly, up to a certain point of territorial size and number of partners (which still cannot be clearly defined), the benefits of the reform may decrease again rather than further increasing (Fritz and Feld 2015, 11ff.);

• Reform process/implementation strategy: voluntariness of the amalgamation. In the case of non-voluntary associations, it is more difficult to achieve a synergy as a result of the reform and the satisfaction with the administration is clearly lower than in voluntary associations (Hansen 2015; Fritz and Feld 2015; 14ff.);

• Local power and consensus-building dynamics: actors constellations, party competition and vote/office seeking, influence of the media and the use/instrumentalisation of democratic participation tools each can function as a game changer concerning reform outcomes (cf. Ebinger 2010);

• Political incentives and political steering of the reform process: First, the willingness to amalgamate often can be bought through political and fiscal concessions. However, this dowry can pose a heavy burden for administrative performance and budgets. Second, without a precise guiding principle the choice of an amalgamation partner is driven by other factors than functional considerations. Such functionally distorted entities may thwart economic and functional gains. Third, common pool problems can sabotage saving targets. Notably in the period between announcement and implementation of the amalgamation incentives for excessive spending may arise (Fritz and Feld 2015).

• Further intervening factors: the existent resources and performance level of the single local authorities or the preference order of citizens might influence performance (i.e. through levelling effects on the service level or common pool problems for investors) (Park 2013; Allers and Geertsema 2016, 662ff.).

These contextual conditions needs to be taken into account, especially when it comes to the transferability of research results. ‘Learning from others’ is possible, though being a question of sense of proportion and balance.

4. Analysis of the impacts of territorial reforms on performance

When assessing performance, administrative and organisational strength of municipalities it is important to keep in mind that it arises from their organisation and resource capacity as well as from their room for manoeuvre in finance, politics, organisation, personnel etc. On the other hand, it is their ability to solve local problems and to influence social developments in the territory in the long term. This includes the ability to fulfil public tasks improving quality, accessibility, legitimacy and efficiency (administrative strength), as well as to act as a strong carrier of public institutions (organisational strength). The following literature based analysis will be centred upon two non-monetary dimensions of the reform impact (cf. Wagener 1969; Kuhlmann and Wollmann 2011, 2013; Kuhlmann and Wayenberg 2016): (1) performance, administrative and organisational strength and (2) integration capacity, participation and democratic control.

4.1 Europe

Beyond fiscal effects, the literature on performance effects of territorial reforms is finite: Very recently, Steiner, Kaiser, and Eythórsson (2016) conducted an international comparative study across 15 European countries. They concluded that territorial reforms led to the improvement of task accomplishment, service quality and standing against higher administrative levels. This depends on the fact that bigger territorial structures receive more tasks, functions and, partly, autonomy (Steiner, Kaiser, and Eythórsson 2016, 26). Except for Italy, the experts interviewed pointed at the improvement of service quality as central result of territorial amalgamations, while the reduction of costs was perceived only sometimes – particularly in Belgium, Germany, Greece and Iceland (Steiner, Kaiser, and Eythórsson 2016, 35).

Another outcome achieved in most countries (Greece, Italy, Netherlands, Sweden, Switzerland) is the improvement in municipal autonomy, consisting in higher financial leeway, expansion of tasks as well as uplifting of previous obligations for inter-municipal cooperation (Steiner, Kaiser, and Eythórsson 2016, 36). In multiple studies conducted in Switzerland, it is shown that the statement ‘municipal size – a success factor’ tends to be true (cf. Lauber 2014, 145). Municipal amalgamations in the canton of Lucern brought about more responsibility and functions for the municipalities, notably the guarantee of organisational autonomy. Moreover, more experts could be employed and the municipal councils could be further involved in strategic tasks. Spatial planning and municipal infrastructures also saw some benefits. Admittedly, not all of these results came fully into effect but they can be expected in the long term, after the reorganisation of basic structures has been carried out and consolidated (cf. Lauber 2014, 144ff.). The study by Steiner and Kaiser (2017) showed positive impacts of municipal amalgamations in 28 service areas. Nevertheless, the comparison between amalgamated and non-amalgamated municipalities revealed several functions where no distinction between study group and control group was noted (Steiner and Kaiser 2017, 14). Overall, the authors conclude that municipal amalgamations improve the quality of service provision, in line with the results of other international studies (OECD 2014; Schimmelpenick et al. 1984). However, the relationship between municipal size and citizens’ satisfaction with government performance is ambivalent. A study about the impact of territorial reforms in Denmark showed that amalgamations are generally associated with lower citizens’ satisfaction with local and municipal performance as well as with the infrastructure facilities. The author infers a negative relationship between size and satisfaction (Hansen 2015, 385). However, the background for such observation might be the intervening factors linked to municipal size. The international comparative study by Denters et al. (2014) reveals that at least two factors intervene in the interplay of size and satisfaction: citizens’ perception of government challenges and local political confidence. In light of these factors, the authors established that the effect of size is but indirect. A negative effect could only been seen in the personal performance, while the satisfaction with local problem-solving and municipal facilities also did not present any negative indirect effects linked to size (Denters et al. 2014, 210).

Overall, the international public administration literature widely agrees that amalgamations strengthen the institutional capacity of municipalities (as opposed to the inconclusive, but critical economic literature). This becomes evident in more robust organisational structures, higher professionalisation of employees, improved capacities for strategic policy-making and problem-solving and a rise in standards as well as (partially) in customer-orientation (see above; Bleker and De Koningh 1987; Denters, de Jong, and Thomassen 1990; Toonen et al. 1998; Fraanje et al. 2008; Alta et al. 2002; for a summary, Schaap and Karsten 2017).

4.2 Germany

For the case of the German Länder, a series of expert opinions and reports illustrate the relation of territorial upscaling with municipalities’ capacity, based on different evaluation criteria and methods.

Mecklenburg-West Pomerania: Hesse’s study (2015) presents empirical findings concerning the impacts of county-level territorial reforms in Mecklenburg-West Pomerania on administrative performance, organisation and innovation capacity of the counties. In the study, the consequences of county restructuring for local self-government were analysed on a three-year span. The consequences of the reform are professionalisation benefits and expansion of services, resulting in increased territorial and political strength (Hesse 2015, 147). In a similar positive vein, the 2015 report of the Court of Audit concluded that the consolidation of organisation and staff in the third year after the restructuring is well advanced (Landesregierung Mecklenburg-Vorpommern 2015, 25). Moreover, positive financial effects were reaped from staff reductions (of just about 3 per cent, or 156 full-time equivalent since 2012). Besides the further saving potential, the fiscal performance of the counties in general clearly improved since 2012. Further synergies and cost reductions were brought about by the fusion of municipal companies (i.e. in the fields of transport and waste) (Landesregierung Mecklenburg-Vorpommern 2015, 39). These findings were confirmed in a more recent study concerning the effects of territorial reforms in Mecklenburg-West Pomerania (cf. Hammerschmid et al. 2015, 2016). Further synergies developed in IT structures, financial departments, and human resources. As a result of the territorial reforms, cooperation between municipal facilities or companies now can be smoothly promoted leading to new synergies (Hammerschmid et al. 2016, 28). Furthermore, some individual interviewees reported a certain improvement of the service for private companies, insofar as the number of relevant contact partners was reduced and economic development promoted (Hammerschmid et al. 2016, 28).

Saxony: To evaluate the effects of the territorial reform in Saxony it is particularly important to take into account their direct relation with a functional reform. In line with the devolution of tasks, a total of 3.416 state employees were deployed to the consolidated counties in 2008. In 2009, additional 759 employees from former county-free cities and further 550 employees of subsidiary facilities (road maintenance depots, vocational schools, registry office, etc.) were transferred to county administrations. Due to this shift in functions and personnel on county level, direct reform effects on efficiency could not be singled out (Sächsischer Rechnungshof 2009, 332). However, to the Court, positive reform effects were indicated by the still on-going processes of organisational consolidation on county level (merging of high schools, vocational schools, boarding schools, media centres, evening schools etc.).

5. Analysis of the effects on participation and integration

A classic research topic in political and administrative science is the possible interplay of territorial size and social cohesion, integrative capacity and democratic participation. Already in 1887, Ferdinand Tönnies analysed the social and political impact of urbanisation and territorial enlargement in his ground-breaking book ‘Gemeinschaft und Gesellschaft’. The sociologist Louis Wirth (1938, 11ff.) considers territorial enlargement to be the origin of declining community identity and increasing social distrust. Several authors took up this so-called ‘decline of community model’. Their common basic assumption is that increasing territorial size has a negative effect on social cohesion, particularly by eroding political and social participation) (Dahl and Tufte 1973, 41–65; Verba and Nie 1972, 229–247; Verba, Nie, and Kim 1978, 269–285.; Oliver 2000, 2001; Putnam 2000, 204–215).

Opponents against this pessimist vision, mockingly labelled ‘Lovely Lilliput’ theory (Denters et al. 2014, 17ff.), argue that the shift in territorial size actually brings along new forms of social aggregation. These are supposed to be characterised by higher diversity and variety in social composition, as well as in social and political institutions of the constituencies (Fischer 1995). Better representation and articulation of the diverse (and at times contrasting) values, perspectives, interests and aims of different population sections is expected (Dahl and Tufte 1973, 30–40, 89–109; Baglioni et al. 2007).

According to Verba and Nie (1972), this differentiated and diversified community leads to the creation of a more competitive democratic system, labelled ‘mobilisation model’. According to this model, citizens have increasing interest in political participation and knowledge of the political processes (Verba, Nie, and Kim 1978, 270). Furthermore, a greater responsiveness towards citizens’ political preferences is implied (Denters and Geurts 1998; Mouritzen 1989; 663). Taking into account that bigger municipalities decide and administrate more (important) decisions, it is argued that the interest in political participation increases too.

5.1 Europe

Overall, recent comparative research (see Denters et al. 2014) concluded that territorial size has at most a moderate effect on local democracy. Other explanatory factors are more important, i.e. individual socio-economic characteristics (gender, education etc.). Despite some indirect and few direct effects of territorial size on aspects of participation (see below), the impact of territorial changes on the exercise of democratic participation rights should not be overestimated (Houlberg 2010, 325). Democratic costs should hence be small or marginal – partly they simply seem not to exist at all. As a matter of fact, even the positive impacts of territorial enlargement on citizens’ democratic participation, political interest and competence can be hardly (or not at all) demonstrated empirically (Denters et al. 2014, 315).

A recent meta-study of 15 countries (cf. Van Houwelingen 2017, 417) on the influence of municipal size on political participation concluded that a relation can be established only rarely. A comparative study of municipalities in Denmark, Norway, the Netherlands and Switzerland found no systematic relationship between territorial size and electoral turnout in three of the four countries. Only for the Netherlands such an effect was discovered. Other (control) variables – hardly related to territorial size – explain turnout rates, namely the social embeddedness of citizens (i.e. membership in associations, clubs; cf. Denters et al. 2014, 229ff.., 304). . These recent findings are in line with an earlier study reporting no significant effect of amalgamations beyond the general decline in voter participation (Kraaykamp, Van Dam, and Toonen 2001). However, they contrast with previous studies, showing the negative impact of municipal amalgamation on electoral turnout (Denters, de Jong, and Thomassen 1990; Denters and Geurts 1998; Toonen et al. 1998; Frandsen 2002; Fraanje et al. 2008; for a summary, cf. Schaap and Karsten 2017).

Denters et al. (2014) also discovered that territorial size affected social activities only in one (Norway) of the four case (Denters et al. 2014, 304). In the Swiss case, increasing territorial size of municipalities had no negative impact on the willingness to participate in referenda. On the contrary, a positive effect was registered in the case of municipalities with assembly systems (Denters et al. 2014, 305). Another finding of the study is the marginal relationship between territorial size and the political interest of citizens. A negative effect could only be found in the Netherlands, while in the remaining three countries a greater territorial size did not diminish the general political interest of the citizens. A study concerning territorial reforms in Denmark (Mouritzen 2010) concluded that the collective democratic participation in the form of social and political organisations and associations tends to increase with territorial size. This is attributed to the fact that democratic participation in political organisations is more common and ‘normal’ in bigger municipalities than in smaller ones (Mouritzen 2010, 35).

Nevertheless, bigger municipalities do have some negative effects on specific aspects of political participation. The four countries study highlights that the level of party political activity of the citizens is higher in the case of smaller municipalities, than in bigger ones (with exception of Switzerland). These findings are also consistent with previous studies conducted in the Netherland reporting a negative relation between territorial size and the willingness of citizens to engage in local parties (Fraanje et al. 2008; Toonen et al. 1998; Schaap and Karstens 2017). The growing ‘representation ratio’ (inhabitants pro mandate) and the resulting burden to speak for a higher number of voters might explain this effect (Denters and Geurts 1998; Bogumil 2016; 41). In Switzerland, the only country in Europe where municipal assemblies are still institutionalised,⁴ municipal territorial size has a negative effect on the willingness to participate (Denters et al. 2014, 303). In the four countries study (Denters et al. 2014), the comparatively strongest negative relationship is found between territorial size and the inclination of citizens to get in touch with local authorities. This result, however, clearly contradicts older studies, which reported a greater willingness among citizens of amalgamated municipalities to get in touch with local authorities (i.e. per post) and to participate to municipal consultations (Fraanje et al. 2008, 81ff.). It was argued, that bigger municipalities provide greater opportunities to participate beyond the ballot box (Denters, de Jong, and Thomassen 1990). Even for the Swiss case, neither a declining willingness of citizens to get in touch with local authorities nor any decline in citizens’ identification with the community was discovered (Steiner, Kaiser, and Eythórsson 2016, 13ff.). Summing up, a mixed picture evolves: municipal amalgamations at times may strengthen or weaken the relation to local authorities (Mouritzen 1989; Denters and Geurts 1998; Schaap and Karsten 2017). Staying within a size thresholds seems to be important to ensure participation: Among Danish municipalities counting from 20,000 to 30,000 and from 70,000 to 80,000 inhabitants a higher size was related with a slight decrease in individual turn-out and political trust. However, based on these results, no tipping-point can be established with certainty. (Mouritzen 2010, 35).

Considering the various results, it is obvious that generalising claims concerning (negative) effects of territorial reforms on local democracy are to be rejected (Mouritzen 2010, 36). Effects are more complex, determined by systemic and local circumstances and often inextricably contradictory.

5.2 Germany

In the current discourse, prevalent studies show alleged political costs of the territorial reforms. Declining turnout and the strengthening of populist parties (i.e. the AfD in Mecklenburg-West Pomerania) are related to territorial enlargement (cf. Rösel and Sonnenburg 2016, 12). Reform-related shifts in political majorities and the reduction in voting power of larger constituencies are made responsible for this effect).⁵ However, these findings contradict several other studies looking into political effects of territorial reforms: Eventual negative effects on participation to local election are considered to be minimal (Seitz 2007, 35ff.). Moreover, in analysing seven Länder, Seitz (2007, 35ff.) found no relationship between size and the willingness to run for a mandate in county council. In addition, upscaling rises the importance of mandates (Bogumil 2016, 41ff.), also due to the shift in the relevance of the decisions to be taken in the amalgamated territories. Admittedly, this boost comes at a prize (Ems 2016; Ems and Nürnberger 2018; Hesse 2015): The political representatives notice the additional burdens, but do not feel deterred by them. Legitimacy of local action is not impaired; there are still enough applicants from different groups for the county-level elections (Ems 2016, 96, 101). Hesse explains this with adaptation processes subsequent to the reforms. A fundamental endangerment of the honorary office is hence not be recognised (Hesse 2015, 136).

Local identity and possible identity loss are a recurring issue with territorial reforms. Bigger, amalgamated units could alienate local politics and citizens, leading to political disenchantment and to further distance among citizens, politics and the administration. For the German case, in line with the overall picture, no clear cut assertions can be made: A study on Brandenburg (Büchner and Franzke 2001) revealed both positive and negative effects of amalgamations.

Discussion and conclusion

In this article, we presented approaches and evidence on the effects of territorial reforms in Germany and in Europe drawn from public administration research. The aim of this paper was to provide a more holistic perspective of administrative science within the discourse on the impact of territorial reforms. To do so, territorial reforms in Europe and especially in Eastern Germany were mapped, an overview on the analytical approaches to territorial reforms was provided and finally a summary of evaluations of these reforms proposed.

These empirical analyses, despite all the differences, show a positive effect of upscaling reforms on most performance indicators. The question is how the notable difference in the assessment of the reforms between economists and public administration comes about. The two communities do not speak to each other, as each – for obvious reasons – tends to stick to their own logics, data and approaches. We presume that the one decisive difference is the presumed aim of the reform ventures. On an abstract level, Blom-Hansen et al. (2016, 1) put the reason for reform in a nutshell:

“Reformers have had several objectives, including reinforcing democracy and building local government capacity [ … ]. But the main motivation has been economic – to reduce costs by capturing economies of scale.”

Most of the scholars engaged in the subject might agree on this appraisal. However, the consequences drawn from this observation differ dramatically. Many economists conclude that success or failure must hence be measurable in budget terms – as a reduction of spending on particular tasks, contraction of overall budget or a reduction of tax burdens. Following this path, several authors found no such effect. This is not at all surprising, considering political processes and exigencies on the local level. ‘Saving money’ (read as externalised economies) is only a secondary goal. Savings derived from amalgamations – if existent at all – will most probably be internalised within the system for several reasons:

First, gains in efficiency will be used to safeguard the sustainability of the local government system. Maintaining or improving local governments’ service quality and problem solving capacity in times of mushrooming regulation, rising citizens’ demands, demographic change and other complex social challenges with at best stagnant fiscal resources requires permanent efficiency gains. Any tiny room for manoeuvre will be used to deliver new, improved or more products and services, as the optimal service level rises (Buettner and Holm-Hadulla 2013) and not be used to reduce the overall budget (c.f. Allers and Geertsema 2016, 678).

Moreover, fixed costs are difficult to reduce by municipal amalgamation (c.f. Drew, Kortt, and Dollery 2016; Blom-Hansen et al. 2016, 17). Cost per unit are almost static in many areas. In the most costly ones as social services, size is almost unrelated to cost, as overhead structures to be streamlined account for a marginal share of the expenditures only. In infrastructure-bound fields such as schools, streets or other public facilities, synergies can be retrieved only after considerable upfront investments in machinery or new buildings. Finally, the reduction of staff is in most public service regimes limited to ‘natural’ turnover. Hence even when synergies would lead to staff reductions (instead of quality or service improvement), this would only be noticeable on the long run. Despite these limitations, most economic analyses find indeed a cost-reducing effect of amalgamations on spending on administration (Allers and Geertsema 2016, 661 with further reference).

Finally, quality of service delivery is almost completely out of the focus of budget-centred analyses. However, increased size will (often for the first time) allow for division of labour, professionalisation and specialisation – a capacity almost indispensable in the face of spiralling complexity and professional demands (c.f. Ebinger 2013, 118f.). Hence, the same budget will produce an improved quality of output – invisible to the eyes of the economists, operating with crude service-level indicators, at best (Allers and Geertsema 2016; 662; Blom-Hansen et al. 2016; 7, 17). We are aware that changes brought about by territorial reforms are hard to capture even by case studies. These impacts are hard to quantify, they appear just in the medium term and contingent to the implementation efforts, and they even can revert, when the municipality reaches a certain size. However, we are convinced that a more open debate between the strands of literature dealing with the subject of territorial reforms will help to overcome these challenges.

The impact on participation and integration capacity of the municipalities is often a matter of conflicting goals that cannot be readily solved. Negative effects can be found in relation to the workload for the honorary office and to the question of local identity (with some limitations on the county level). Nevertheless, these are often ambivalent effects, as in the case of citizen-orientation (professional administrative work for the citizens vs. spatial remoteness) and in the quality (cost vs. value). Upscaling – within a certain magnitude – seems to have no impact on the capacity or willingness to take up an honorary post, neither in municipalities nor counties. However, elaborating reform processes can certainly mitigate or prevent certain negative effects. Overall, there is no valid evidence that the legitimacy and citizen orientation of local action deteriorate appreciably if certain territorial limits are not exceeded. In sum, through territorial and functional reforms, the county level gains in substance and organisational capacity. Despite these findings, the current developments in the German reform debates suggests that rational discussions of reform effects become increasingly more difficult. This article hopefully contributes to turn this trend.

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Notes on contributors

Falk Ebinger

Falk Ebinger is Assistant Professor at the Institute for Public Management and Governance at Vienna University of Economics and Business (WU Wien), Austria. His research focuses on the governance of, as well as leadership and behaviour within, public administrations; bureaucratic elites and administrative performance; and reform of public sector organisations. He has published in journals including International Review of Administrative Sciences, Local Government Studies, Politische Vierteljahresschrift and der moderne staat.

Sabine Kuhlmann

Sabine Kuhlmann is Professor of Public Administration and Organization at the Faculty of Economics and Social Sciences at University of Potsdam, Germany. She is Vice-Chair of the German National Regulatory Control Council, Vice-President for Western Europe of the International Institute of Administrative Sciences (IIAS), and Vice-President of European Group for Public Administration (EGPA). She is deputy editor of the International Review of Administrative Sciences, and has published in journals including Public Administration Review, Public Management Review, and Local Government Studies. She has recently co-authored, with Hellmut Wollmann, Introduction to Comparative Public Administration (Kuhlmann and Wollmann 2014; 2nd ed. 2019).

Joerg Bogumil

Jörg Bogumil is Professor of Public Administration, Regional and Local Policy at the Faculty of Social Science at University of Bochum, Germany. His research focuses on the modernization of local and regional administrations, regionalisation processes and the municipal budgetary crisis. His most recent publications cover, among other subjects, the new financial management of municipalities, new governance structures in German universities and the management of the recent refugee crisis.

Notes

1. For state of the art and further reference, see Alders/Geertsema 2016 and Blom-Hansen et al. 2016.

2. Even the authors of this paper (in different constellations) have been often called upon by the Land governments to provide their expert opinion on reform ventures (Bogumil and Ebinger 2012; Bogumil, Kintzinger, and Mehde 2014; Bogumil 2016; Kuhlmann, Seyfried, and Siegel 2017). Kuhlmann, Seyfried, and Siegel (2017) conducted a (meta) analysis of 83 scientific studies and other research (i.e. Court of Audit) allowed to expand the content of the discussion around the reform impacts, while taking into account also different methods, approaches, time frames, and interest groups.

3. Refer to the OECD Country Profiles for an overview of the countries where the municipal system is organised into one or two level: http://www.oecd.org/regional/regional-policy/country-profiles.htm.

4. In the municipal assemblies, known also in Brandenburg and Schleswig-Holstein until the 20th century, all citizens of the municipality eligible to vote can take legally binding decisions upon issues concerning the municipality. These assembly systems do not foresee a municipal council.

5. For a detailed critique of the methods and design, see Kuhlmann, Seyfried, and Siegel 2017, 46ff.