The real reason why so many humans can confidently proclaim that 'bigger is always better' without knowing in advance how 'bigger' will actually turn out , is because bigger always means fewer --- in any given biological, social or economic niche.
For example , instead of thousands of small town bankers all competing against each other in unpredictable chaotic ways, they can all merge into a few big national banks : each with just one CEO, one Board of Directors, one set of unbending lending rules etc.
Neat, tidy, orderly : Canadian static simplicity and predictability instead of American plentitude's dynamic chaos.
(So now you know why Canada and the US so differ in their industrial competitiveness !)
Yes, a merger into a bigger entity might mean more profits but it might not - for as many mergers quickly and costly de-merge as prosper - but that is not the real point.
Similarly those pea-counters in the media obsessed with seeing fewer municipalities (and fewer council members) are not really concerned about cost savings despite their claims.
This is because the hard evidence suggests that total for the new higher salaries, pensions and benefits for the fewer council members (and for their new support staff) far exceeds the total costs when we had many town councils with many councillors --- all paid peanuts and with no support staff.
This mantra is never ever really about more profits or fewer costs but is actually about maintaining own's mental health.
For billions of humanity, 'bigger is always better' really means 'much better for their own mental stability' : they simply can't handle too much change or variety very well --- it 'hurts' their head.
As for why, no one really knows for sure. We can tentatively blame it on their individual genetic brain chemistry, in combination with how they were individually raised.
This is not a full on/full off condition but something we humans all have in common, each of us set along a sliding continuum from 'manageable' to 'all-consuming'.
So always think of the mantra 'bigger is better' as a quasi-prozac pill and you'd be on the right track...