ACKNOWLEDGEMENTSFirst of all I would like to thank Dr. Hank Savitch for his guidance, help and patience. Thank you, Dr. Savitch! It was an honor working with you on this and other projects over the last several years.I wish to thank all the members of my dissertation committee for their advice and support. In addition, I would like to thank Dr. Peter Meyer for his valuable comments and ideas for this research. Fragmentation of governments and urban sprawl has been a subject of debate for a considerable time. The discussion often centers on whether space (sprawl) and politics (fragmentation) make a difference in the economic development of metropolitan areas. The hypothesis was set to follow the argument of polycentric school of thought on the organization of metropolitan governance. It was expected that competitive local public economies would be beneficial to the economic performance of the regions. Regarding the effect of sprawl, the study assumed that following the lines of free-market defense of sprawl it would be positively associated with economic performance of the metropolitan areas. The aim of this study was to examine empirical evidence and find support for either of these theories.The dissertation is organized in six chapters. The first chapter introduces the issues of metropolitan governance. Chapter II reviews dominant theories of metropolitan governance, defines fragmentation and sprawl, outlines the discussion on cost and benefits of urban sprawl, and examines theoretical and empirical research linking fragmentation and urban sprawl. Chapter III describes the research methodology by formulating specific models used for this investigation and outlining the variables used in the models. The results of the statistical analysis are presented in The hypothesis about the positive impact of sprawl on economic performance of metropolitan areas was not confirmed. In fact, the opposite is true at least for a large part of US metropolitan areas. Metropolitan areas with population between 200,000 and 1,000,000 with higher levels of sprawl demonstrate weaker economic performance.The associations between sprawl, fragmentation and such desirable and beneficial to economic performance indicators as human capital, affluence and tax effort are statistically significant and they take the same direction as the ones with economic performance -positive for fragmentation and negative for sprawl.Previous research suggests that the impacts of local governance structure on metropolitan economic performance may be secondary to the trends in state economic development. Regression analysis performed in this study reveals that the impact of fragmentation and sprawl on economic performance of metro areas is comparable to that of their states' economic performance.While fragmentation and sprawl are weaker predictors of economic performance than economic development factors (human capital and tax effort), controlling for these factors did not render the relationships between fragmentation, sprawl and economic performance statisti...