Metropolitan governance and territorial inequalities: an assessment of the Social Stratification and Government Inequality thesis in Switzerland

Abstract

The relationship between institutional fragmentation of urban regions and inequality in government service levels is subject to a long-running debate. On the one hand, neo-progressive reformers argue that fragmented municipal institutions produce a systematic mismatch between fiscal resources and public needs and thereby perpetuate income inequality. On the other hand, public choice scholars hold that polycentric government is more responsive to residents’ needs, and that issues of income distribution can be addressed by intergovernmental coordination. However, the role of this multi-level intergovernmental compound of metropolitan governance in tackling territorial inequalities remains unclear. This paper aims to contribute to the further development of this debate, by drawing on a comprehensive analysis of social policy efforts at the municipal level in the seven largest metropolitan areas in Switzerland. We explore the effect of social segregation, municipal resources, residents’ political preferences, as well as intergovernmental grants on per capita social expenditures in metropolitan municipalities. The results show that, while multi-level intergovernmental cooperation and fiscal equalization between rich and poor municipalities do play a moderating role, institutional fragmentation is an obstacle to matching fiscal resources with social policy needs. In the fragmented setting of the Swiss metropolis, social policies at the municipal level appear as an act of political voluntarism by the rich, rather than as a matter of redistribution oriented by principles of social justice.