Date of Award


Document Type


Degree Name

Doctor of Philosophy (PhD)


The genesis of federal grants-in-aid can be traced back to the Northwest Ordinances of 1785 and 1787. From those earlier years to the present, grants have been introduced in response to individual needs that have existed at particular points in time. As a result of the basic reaction nature of grants, only a very negligible consideration has been given to developing the individual grants into an integrated, non-conflicting system. As could be expected, the consequence of this approach to grant development has been an uncoordinated grant program containing overlapping grants in some cases and conflicting ones in others. In fact, the unsystematic approach to grants taken in this country has made it virtually impossible to obtain an accurate count of the number of different grants which exist. This paper approaches the study of grants from the perspective of enhancing cooperation among governmental units which produce goods with spillout effects. To accomplish this task, a model was developed to demonstrate the effects of reciprocal externalities generated by two communities under several different assumptions. Welfare characteristics were evaluated under conditions of cooperation and non-cooperation to determine whether or not cooperation would likely take place between the communities. In those cases in which cooperation was likely to occur, grants were found to play a positive role in promoting cooperation. Finally, individual characteristics of grants were investigated to determine their possible effects on cooperation among governments.