Understanding intergovernmental cooperation in a context of devolution: an empirical study of collaboration among portuguese municipalities

Why do local governments engage in formal cooperative agreements to deliver municipal services? What are the determinants of these collaborative efforts? We review the literature on horizontal collaboration and intergovernmental relations developed by the political economy, public choice, institutional collective action, and network literatures and present a theoretical model that intertwines several arguments from these literatures. The theoretical model suggests that the decision to collaborate is a product of prior experiences of competition/cooperation between municipal governments, the incentives for efficiency gains derived from cooperation, and the institutional setting in which intergovernmental relations take place. Based on this theoretical model and using a research design inspired by the literatures on international conflicts and coalition governments, we develop and test a series of hypotheses concerning the decision to cooperate by Portuguese municipal governments in face of recent decentralization trends. We find support for our trust and centrality hypotheses as incentives to cooperation, but fragmentation within local governments poses a constraint to collaborative efforts between municipalities.Fundação para a Ciência e a Tecnologia (FCT)