Local government cooperation at work: A control function approach

Zineb Abidi, Edoardo Di Porto, Angela Parenti (aparenti79@gmail.com) and Sonia Paty

Discussion Papers from Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy

Abstract: We analyze voluntary coalition formation using a unique panel data for 1,056 municipalities in the French region of Brittany between 1995 and 2002. We use a control function approach to develop a binary discrete choice model with spatial interactions. We find that a municipality's decision to cooperate over the provision local public goods depends on the decisions of its neighbours. Comparison with spatial econometrics models (SAR and Durbin) shows that the decision to cooperate is over estimated by these more traditional models. The results are in line with the recent applied spatial economics literature but are derived for a discrete choice model setting.

Keywords: Inter-municipal Cooperation; Panel Data; Control Function. (search for similar items in EconPapers)
JEL-codes: C3 H2 H4 H7 (search for similar items in EconPapers)
Date: 2015-07-01
New Economics Papers: this item is included in nep-cdm, nep-eur, nep-pbe and nep-ure
Note: ISSN 2039-1854
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Related works:
Journal Article: Local government cooperation at work: a control function approach (2017)
Working Paper: Local government cooperation at work: a control function approach (2017)
Working Paper: Local government cooperation at work: A control function approach (2014)
Working Paper: Local government cooperation at work: A control function approach (2014)
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