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2.1 Introduction
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benefits of size: economies of scale, larger markets, mutual insurance, protection against foreign aggression, and power and influence in international organizations.
Note:RIASSUNTO BENEFICI DIMENSIONE

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increasing costs of heterogeneity of preferences,
Note:SVANTAGGI

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For some public goods
Note:OGNI BENE PUBBLICO È UN CASO A PARTE

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distance may be insignificant.
Note:X ALCUNI BENI PUBBLICI

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a complex web of overlapping jurisdictions
Note:L OTTIMO TEODICO

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Without transaction costs, economies of scope, and organizational costs,
Note:BOUQUET DI GOVERNI

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Decentralization within a country can in fact be seen as an intermediate step
Note:UNA VIA VERSO L OTTIMO

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supernational organizations
Note:CONTROPARTE

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we do not observe, say, California joining the United Nations but not the World Trade Organization (WTO),
Note:SECONDO TRADIZIONE...REGOLA DELLA PIRAMIDE

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Thus we have a "pyramid"

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2.2 The Trade-off between Size and Heterogeneity
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monetary and financial system, tax collection and fiscal institutions, a legal and judicial system, infrastructures, communication systems, law and order, public libraries, national parks, and embassies.
Note:BENI PUBBLICI

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fixed costs,
Note:LA CONVENIENZA

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Different individuals have different views about how the polity should spend their tax money.'
Note:TUTTAVIA

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some citizens prefer a strong defense
Note:ES

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Public goods have not only an ideological dimension but also a geographical
Note:PREFERENZE IDEOLOGICHE E VANTAGGI GEOGR

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the capital,
Note:PRIVILEGI

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it is advantageous to live around Paris,

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"hub" of the main national airline, either in Milan or Rome
Note:SU QUALE AEROPORTO PUNTARE?

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an Irish person who happened to agree with a Japanese person on school policies would set up a joint public school system.
Note:SE LA GEOGRAFIA NN CONTASSE

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individuals who are close together in space are also more alike in preferences,
Note:ALTRA SPIEGA SULLA COMPATTEZZA GEOGRAF

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hundreds of years of proximity generate more uniformity

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A common language

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Geography and preferences are likely to be correlated

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sorting by income, race, and ethnicity.3
Note:USA APARTHEID

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a "liberal Democrat who lives in a largely Republican neighborhood
Note:ES DI NON CORRELAZIONE

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for instance, one would want large jurisdictions that share a currency, and much smaller ones that share a school system.
Note:ESEMPIO DI OTTIMO

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In reality, we observe that small jurisdictions (school districts, municipalities) are not crossed by the borders of large ones
Note:CAMBIARE I SOLDI X LA FOCACIA A SCUOLA

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large jurisdiction generally encloses smaller jurisdictions.

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Citizens of two different countries do not share public goods
Note:NELLA REALTÀ

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overlapping jurisdictions, would imply excessive organizational costs.

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Multiproduct companies, such as Proctor and Gamble,
Note:ECONOMIE DI SCOPO

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military forces can be used for external defense and to keep law and order
Note:ESEMPIO

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satisfy heterogeneous preferences.
Note:ANCHE QUI CONTRAPPESO

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Musgrave (1971) describes a world free of transaction costs and economies of scope and organized in overlapping jurisdictions
Note:TEORIA

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Frey and Eichenberger (1999)
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the monopoly of legitimate use of coercion plays a special role; to some extent it defines the very nature of a state,
Note:NATURA DELLO STATO

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*2.3 A Model of Specialized Jurisdictions
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