Intermunicipal cooperation offers an interesting alternative in cases when municipalities are too small to individually provide public services at an efficient cost level but are reluctant to form a municipal amalgamation in order to benefit from economies of scale. Forming a body consisting of multiple municipalities with a specific focus provides a way to reduce costs on service provision while maintaining municipal sovereignty in other areas. In our paper, we quantify the cost benefits of utilizing intermunicipal cooperation in the field of municipal solid waste management. We examine this using data from a 10-year period from municipalities in the South Moravian Region in the Czech Republic, where high municipal fragmentation results in many dominantly small municipalities that often are not able to provide public services at reasonable costs. This analysis contributes to the literature by conducting a long-term study of the effects of intermunicipal cooperation on public service provision costs. Our results suggest that municipalities participating in intermunicipal cooperation focused on waste management experienced annual cost savings of approximately 13.5% for provision of this service throughout the examined period of 2010–2019 when compared to municipalities that did not cooperate. These long-term results show how beneficial intermunicipal cooperation can be in reducing service costs. In addition to the direct financial benefits, municipal representatives stated that intermunicipal cooperation often brings other qualitative and non-financial benefits such as better service quality, the possibility to share infrastructure, and relief from administrative and managerial burdens through the utilization of professional management, which was especially appreciated by the smallest municipalities with limited administrative staff.

Economies of scale are a standard topic in economic theory, frequently applied, for example, in the analysis of monopolies. They exist when a firm optimising its production costs while facing some fixed costs enjoys lower per-unit production costs as the production increases. Similarly to other production units municipalities have to be large enough to minimise average costs. We analysed the local public services in 205 municipalities with extended powers in the Czech Republic for the first time in this context, using regression analysis, a correlation diagram of local public services and statistical analysis. The paper examines this issue using data from 2008 to 2012. Our analysis showed that economies of scale cannot be clearly identified for local services in municipalities with extended powers in the Czech Republic and that the size of a municipality is not a key factor influencing the provision of local services.

This paper deals with an efficiency of current municipal expenditure on environmental protection and suggests a methodology for assessing this efficiency. A proposal of methodological procedure for evaluating efficiency of municipal environmental protection expenditure uses multi-criteria evaluation, where a dominant criterion of performance is modified method of Cost-effectiveness analysis. It was implemented in open source software. The efficiency in the methodology is intended in terms of 3E methodology – Economy, Efficiency and Effectiveness, together with the methodology of sustainable development – social, environmental and economic part of sustainable development. This procedure is applied to a set of environmental protection expenditure data that come from the representative sample of municipalities in areas of waste management which were used in a project of the Ministry of Environment of the Czech Republic SP/4i1/54/08 “Analysis of municipal budgets efficiency in relation to the environmental protection”.