The decentralization trend that pervades the countries of Western Europe since the second half of last century is still more power-transmitted to the lower administrative, self-governing units respectively – regions and municipalities. In Europe, however, we find considerable diversity of local structures.
One of the factors influencing the function of local government is the settlement structure. This article intends to outline the two basic models, which are applied in Europe to increase the effectiveness of the function of municipalities, and in the cases of Estonia, France, Finland and the Netherlands.