So much for the conventional wisdom.
For years, state lawmakers and pundits - including editorial writers - have maintained that consolidating New Jersey's municipalities is the key to cutting the state's high property taxes. The state just has too much government, the story goes.
Now a study by Rutgers University's Bloustein Local Government Research Center calls that into question.
Researchers Raphael J. Caprio and Marc H. Pfeiffer studied 513 municipalities in the state. (Resort towns were excluded because their unusual model - small populations with outsized services for seasonal visitors - tend to skew results.) According to their research, there's no correlation between the size of a town and the size of its property-tax bill and no truth to the "folk hypothesis" that consolidation automatically means savings.
And Caprio and Pfeiffer found that, rather than having too much government, New Jersey actually has about half as much government as the national average. Its level of government entities per 10,000 population ranks it 34th out of 50 states.
The researchers said the per-capita cost of government doesn't vary much between large and small towns. In 2011, towns with populations of less than 1,900 paid $1,271 per person for their governments, while towns with populations of more than 40,000 paid $1,340. The least costly governments, $1,092 per person, were in small towns with populations of between 3,601 and 5,150.
So in most cases tax savings from consolidation would probably be marginal, at best, and consolidation could actually make things worse, according to this study. Just because a municipality is bigger doesn't necessarily mean it will be more efficiently run.
"We may need to rethink the conventional wisdom that forcing municipalities into larger organizations will be more effective, more efficient, and/or less costly," the report says. "Efforts aimed at forcing municipalities to consolidate might just as readily result in undesirable and/or unintended consequences emerging from consolidation."
The report says that the most important cause of rising property taxes in recent years has been cuts in state aid. Which suggests that reducing the cost of state government - and restoring that funding - could have the biggest impact on local property-tax bills.
And the authors say that sharing services has resulted in real savings. Rather than pushing consolidation, lawmakers would be better off eliminating road blocks that still make it difficult for towns to work more closely together.
Perhaps the most interesting questions raised by the Bloustein study are: Why hasn't more local-government research like this been done to inform the property-tax debate? And how many other public-policy truisms may be nothing more than a "folk hypothesis"?