Association for Public Policy Analysis & Management

Urban scholars have long recognized the faults of political fragmentation resulting in inefficient economic development usage, environmental degradation, social segregation, a lack of scale economies of production, duplicated service provision, and other negative externalities from these competitive environments. Horizontal fragmentation is the result of having multiple political jurisdictions spatially adjacent within a metropolitan area. Scholars have also recognized the issues of vertical fragmentation where decisions of hierarchical governments (e.g. cities nested within counties) cause inefficient financial decisions. This article advances another level of fragmentation, which we refer to as “spherical fragmentation.” Spherical fragmentation, it is argued, cuts across each level of fragmentation (horizontal, vertical, and even diagonal) which results from bordered-metropolitan areas (those spanning more than one state).

This article estimates the impact of this level of fragmentation by testing the individual and joint effects of horizontal fragmentation (estimated as the number of non-single issue governments within the metropolitan area), vertical fragmentation (number of nested units within the metropolitan area) and interacting these dimensions with an indicator for bordered-metro areas to measure spherical fragmentation. The article tests whether this spherical fragmentation has a differential impact on fiscal health and volatility for bordered-metropolitan areas relative to non-bordered metropolitan areas.

We are utilizing a newly constructed dataset of economic, fiscal, political and demographic characteristics across levels of governments and between jurisdictions. With more than 50 metropolitan areas spanning more than one state, we utilize dyadic pairs of bordered and non-bordered metropolitan areas (matched by state) over a 10-year span (1999-2009) to estimate differences in fiscal health and volatility resulting from spherical fragmentation. This paper seeks to make three contributions. First, it provides a new theoretical framework for understanding an additional dimension of political fragmentation. Second, it provides a unique and rich dataset that is longitudinal and national in scope. Finally, it proposes a new theory for the role of fragmentation on fiscal health and volatility.