Impact of municipal mergers on local population growth: an assessment of the merger of Japanese municipalities

Abstract

Municipal mergers have been widely used as a tool for administrative reform at the municipal level in various countries. While there are many studies of such reform initiatives, most have overlooked the issue of the unequal distribution of merger benefits among merged municipalities. This article responds to this research gap by assessing the impact of municipal mergers on local population growth in Japan – and, in doing so, appreciates that mergers differ within each of the merger partners, and also that the extent to which pre-merger municipalities can benefit from municipal mergers is contingent on their size relative to that of their merging partners. A unique dataset of Japanese local governments both pre-merger and post-merger facilitates an analysis of the impact of municipal mergers on local population growth. By employing propensity score-matching, it is found that, in Japan, municipal mergers negatively affect population growth for municipalities if they are not the largest municipalities among their merging partners. This finding suggests that not all pre-merger areas benefit from municipal mergers; rather, smaller municipalities are likely to incur considerable costs from municipal mergers.

Keywords:

• local government
• municipal mergers
• administrative reform
• population growth
• Japan

Notes

1. Details on the methodology are available on request from the authors.

2. Three municipalities are excluded from the assessment: the former Yamakoshi village in Niigata Prefecture, the former Miyake Village in Tokyo Prefecture, and the former Kamikuisshiki village in Yamanashi Prefecture. Both Yamakoshi village and Miyake village experienced a major natural disaster. They reduced Yamakoshi village’s population in 2005 to ten from 2,523 in 1995, and Miyake village’s population in 2000 to zero from 3,831 in 1995. Kamikuisshiki village was separated into two parts, and each part was absorbed into different municipalities; this made it impossible to compare the population growth rate in the pre-merger and post-merger periods.

3. Scholars have not yet established practical procedures for multi-categorical treatment variables (Hu & Mustillo, 2016).

4. Municipal mergers took place more than twice for some municipalities. In this case, all municipalities involved in the merger are included in one group. For example, if a municipality A was merged with B and C, and then later with D and E, A, B, C, D and E are included in the same merging group.