Despite being the most common form of local government in the United States, spending more than all city governments combined, and having more civilian employees than the federal government, special-purpose governments have received precious little attention from scholars. Perhaps most surprisingly, no one has ever produced a theory of the politics of local special-purpose government. Fortunately, such a theory need not be constructed from whole cloth, for these local institutions bear a family resemblance to other, more familiar institutions of specialized jurisdiction, such as congressional committees and parliamentary ministries. In this chapter, I build a model of special-purpose government that is grounded in modern theories of political economy. I begin with a basic model of interest group competition with probabilistic voting (e.g., Hettich and Winer 1999; Persson and Tabellini 2000, ch. 7). I introduce two novel elements to the model: First, I allow for the existence of multiple independently elected governments, each providing a different public good; second, I allow for selective participation by the interest groups in the election of each government. Throughout, my emphasis is on understanding how outcomes differ when policy is made by one general-purpose government compared to multiple overlapping single-function governments.

The central intuition of my theory is that removing a policy issue from the purview of a general-purpose government and placing it under the jurisdiction of a single-function district enables the interest groups concerned with the issue to increase their influence over it.