The United States is awash in local governments. Not only does every state create local governments, but every state relies on those local governments to carry out the day-to-day functions of government. These local governments, though, are not the state. They are distinct legal entities vested with their own legal personhood. That is, they sue and are sued, they own property, and they enter into contracts—all in their own names. Many rich accounts detail the historical reasons why local governments arose. But a different, theoretical question remains: What can a state achieve with local governments that it cannot achieve without them? This Article offers one answer to that question, namely, municipal finance. Specifically, this Article shows how certain financial aims become achievable for a state only if the state creates a legal person distinct from itself. By creating such local governments, states often can obtain more federal funding, can borrow more, and can receive more favorable debt terms than if the state itself had undertaken the same endeavor. The Article’s conceptual contribution—highlighting the connection between municipal finance and local governments as legal persons distinct from the state—sheds light on a range of issues. It offers a way of thinking about the relationship between local governance and local government, a window into the relationship of municipal finance and corporate finance, and an angle on fiscal relationships between states and local governments.
Income inequality is a national preoccupation, and the public’s imagination is captured by the astronomical incomes of Valley tech billionaires and...
The global economy owes more than $100 trillion in reparations for slavery, but states have persistently deferred payment. Meanwhile, the OECD’s...
Something is amiss in empirical economics. Despite the advances of the credibility revolution, published estimates tend to be inflated and...
The storm clouds hovering above public and private universities in the United States are neither divine judgement nor a day of reckoning. Rather, they...
The past decade has been one of rapid and sweeping changes in international politics and economics. Unlike international trade and investment, the...
From a legal and economic perspective, the document discusses housing affordability as a key global issue for well-being, economic growth, and...
During oral arguments in a child abuse case, some Texas Supreme Court justices seemed open to the possibility that the amendment protected parental...
Contractual provisions come in and out of vogue, even in stultifyingly standardised financial instruments. The latest burst of creativity has been...
This Article tells the story of the birth of predictive algorithms in criminal justice. Known as risk assessments, these tools are widely used today...
We introduce altruism into standard models of bargaining and explore its implications for the Coase Theorem. A strict interpretation of the Coase...
Artificial intelligence, machine learning, and algorithmic prediction tools have made huge advances in recent years. Some argue that we are on the...
This comment on Katrina Wyman and Danielle Spiegel-Feld’s new book, Local Greens: Cities and Twenty-first Century Environmental Problems, argues that...
This paper, presented as the William J. Brennan Jr. Lecture at the Oklahoma City University School of Law in November 2025, argues that American...
Researchers commonly seek to understand whether a policy has differential impact on different subgroups, yet the choice of differential impact metric...
This week, Virginia's State Air Pollution Control Board was in court asking the Virginia Court of Appeals to revive its ill-conceived plan to leave a...
“In a time when disinformation is being laundered through government agencies, the responsibility to protect evidence-based care falls to courageous...
We examine the design of lawmaking institutions when advocates have agenda setting power and there is randomness in the status quo laws eligible for...