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Title page 1
Contents 7
Foreword 4
Acknowledgements 6
Executive summary 10
1. Why engage in inter-municipal co-operation: drivers, benefits and challenges 12
1.1. Introduction 13
1.2. Policy options to address municipal capacity and scale challenges 13
1.3. Inter-municipal co-operation: a pragmatic and flexible option to respond to both shrinking and growing areas 21
1.4. Inter-municipal co-operation is a widespread tool in OECD countries, taking different forms according to countries' traditions and local needs 27
1.5. The benefits and challenges of inter-municipal co-operation 35
References 44
Notes 51
2. How to implement effective inter-municipal co-operation: setting the right policy frameworks 52
2.1. Introduction 53
2.2. Enabling conditions for inter-municipal co-operation 54
2.3. Setting an enabling legal framework 59
2.4. Setting the appropriate institutional framework 65
2.5. Setting a solid fiscal framework 82
References 97
3. Country Snapshots of inter-municipal co-operation frameworks in OECD countries and selected accession countries 102
Introduction 103
Australia 103
Austria 104
Belgium 105
Brazil 105
Bulgaria 106
Canada 107
Chile 108
Colombia 109
Costa Rica 110
Croatia 111
Czechia 112
Denmark 113
Estonia 114
Finland 115
France 116
Germany 117
Greece 118
Hungary 119
Iceland 120
Ireland 121
Israel 122
Italy 123
Japan 124
Korea 125
Latvia 126
Lithuania 127
Luxembourg 128
Mexico 128
Netherlands 130
New Zealand 131
Norway 131
Peru 133
Poland 133
Portugal 135
Romania 136
Slovak Republic 137
Slovenia 138
Spain 139
Sweden 140
Switzerland 141
Türkiye 142
United Kingdom 143
United States 145
References 146
Figure 1.1. Average and median municipal sizes in the OECD and EU, 2025 14
Figure 1.2. Municipalities by population class size in the OECD and EU, 2025 15
Figure 1.3. Municipal mergers in OECD countries (2005-25) 17
Figure 1.4. Three main types of asymmetric decentralisation 21
Figure 1.5. A wide diversity of inter-municipal co-operation arrangements in OECD countries from the softest to the strongest forms of integration 28
Figure 2.1. Core pillars of an effective inter-municipal co-operation policy framework 53
Figure 2.2. Number of associations of municipalities (mancomunidades) in Spain (2024) 76
Figure 2.3. Unions of municipalities (Unioni di Comuni) are very uneven across Italian regions 77
Figure 2.4. Financial incentives for inter-municipal co-operation 83
Figure 2.5. Incentives for inter-jurisdictional co-ordination 83
Figure 2.6. Main sources of funding and financing for inter-municipal co-operation 90
Boxes 9
Box 1.1. Municipal mergers in OECD countries 17
Box 1.2. Municipal amalgamations often face strong resistance 18
Box 1.3. Asymmetric decentralisation 20
Box 1.4. Demographic change and inter-municipal co-operation: Insights from recent OECD-EC policy initiatives 22
Box 1.5. Shared service centres: new pilots in Poland and Slovakia 23
Box 1.6. Inter-municipal co-operation as a pathway to effective metropolitan governance 24
Box 1.7. Recent urban and metropolitan governance reforms fostering inter-municipal co-operation 26
Box 1.8. Inter-municipal co-operation is mostly voluntary, but sometimes required 29
Box 1.9. The timeline of inter-municipal co-operation in France 31
Box 1.10. Intermunicipal co-operation in Spain combines national and regional arrangements 32
Box 1.11. Supporting inter-municipal co-operation for sustainability: Green Communities in Italy 33
Box 1.12. Rural Growth Agreements in Norway: piloting inter-municipal co-operation through multi-level governance 37
Box 1.13. Why inter-municipal co-operation matters for spatial planning 39
Box 2.1. Examples of tools to enhance transparency for citizens and democratic accountability in France 55
Box 2.2. The definition of functional and inter-municipal co-operation areas 56
Box 2.3. Municipal data on service costs and use in Nordic countries 58
Box 2.4. Piloting inter-municipal co-operation in Tauragė+ functional zone, Lithuania 64
Box 2.5. Delegated responsibilities to EPCIs in France 68
Box 2.6. Shared services arrangements: the Irish example 69
Box 2.7. Inter-municipal companies: balancing public purpose and market competition 72
Box 2.8. Recent reforms strengthening inter-municipal co-operation 74
Box 2.9. Uneven inter-municipal co-operation development reflects differing regional support and engagement 76
Box 2.10. Intergovernmental contracts to foster a co-operation culture in OECD countries 77
Box 2.11. Platform to support the new "Communities of Municipalities" in Czechia 78
Box 2.12. Government support and capacity-building for inter-municipal co-operation: Poland example 80
Box 2.13. Examples of financial incentives for inter-municipal co-operation 84
Box 2.14. Inter-municipal co-operation through place-based strategies in Italy: the National Strategy for Inner Areas (SNAI) 85
Box 2.15. EU instruments to foster municipal co-operation culture and practices 86
Box 2.16. Centrality and capital costs in urban areas: policy watch for Spain 88
Box 2.17. Intra-EPCI solidarity mechanisms in France 89
Box 2.18. France: a comprehensive grant system for EPCIs 93
Box 2.19. Borrowing and bond issuance by French EPCIs 95
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