Political Mergers as Coalition Formation: An Analysis of the Heisei Municipal Amalgamations

Due to moral hazard problems, municipal mergers in Japan did not result in as many amalgamations as a central planner would have chosen. The inefficiency of the decentralized mergers is calculated using structural parameter estimates based on observed mergers and actual national government policies. Estimation requires neither an equilibrium selection assumption nor the enumeration of all possible mergers.

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Working or Discussion Paper
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JEL Codes:
C63; D71; H77
This is a substantially revised version of my job market paper that also incorporates work that was presented separately as “Coalition Formation with Panel Data”. I would like to thank my thesis committee: Daron Acemoglu, Abhijit Banerjee, and Esther Duflo. I would also like to thank Nobuo Akai, Alberto Alesina, Tim Armstrong, Tal Gross, Masayoshi Hayashi, Hidehiko Ichimura, Vadim Marmer, Konrad Menzel, Masashi Nishikawa, Tai Otsu, Nancy Qian, Pablo Querubin, Testuya Shimane, Enrico Spolaore, Kota Sugahara, Francesco Trebbi, Patrick Warren, and many other attendees at seminar presentations for their helpful comments. This research was supported by a Canadian Institute for Advanced Research junior fellowship and a Japan Society for the Promotion of Science postdoctoral fellowship. Computational support was provided by the Yale Faculty of Arts and Science High Performance Computing facilities, based on initial computations performed at MIT. The usual disclaimer applies.
Series Statement:
Economic Growth Center Discussion Paper

 Record created 2017-04-01, last modified 2017-05-27

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