“Small Is Beautiful”

Abstract

This chapter discusses the problem of territorial fragmentation and summarizes the arguments for and against a solution in the form of territorial consolidation regarding the example of the Czech Republic. The main reason for the consolidation of municipalities are the benefits derived from the theory of the economies of scale. Linked to this is also the question of how to determine the optimal size of a municipality in order to make the best use of the principles of scale economies. The second part of this chapter shows an analysis of Czech municipal expenditures on selected public services that municipalities provide, and based on the results, determine the optimal size of the municipality for the analyzed services. Data from the Czech Republic do not clearly support the economic arguments for territorial consolidation