The structure of urban governance in South African cities

This paper analyzes the economic factors that will determine the evolution of the structure of urban governance in South Africa's major metropolitan areas. The paper suggests that fiscal autonomy, distributional, and efficiency considerations have supported a move toward a two-tier metropolitan structure. Within this two-tier system, fiscal stability considerations favor a model of functional fragmentation and privatization of municipal services. Two factors that have influenced the choice of urban governance are spatial policies of the apartheid regime and the uncertainty in the allocation of fiscal transfers between different tiers of government.