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Federalism, distributive politics and representative democracy

Author

Listed:
  • Guillaume Cheikbossian

Abstract

We analyze federal systems of government in which local public policies are financed by general taxation. In a decentralized political system there is, in each region, a vote to elect a local representative while in a centralized political system a single representative is elected by a federal vote. It is shown that under decentralization, voters strategically elect liberal representatives so as to nullify any element of cooperation between representatives in the decision-making stage. Thus, there is a trade-off between the budgetary externality and a “policy closer to the people”, but the democratic choice is biased towards decentralization. Copyright Springer-Verlag Berlin Heidelberg 2000

Suggested Citation

  • Guillaume Cheikbossian, 2000. "Federalism, distributive politics and representative democracy," Economics of Governance, Springer, vol. 1(2), pages 105-122, July.
    • Handle: RePEc:spr:ecogov:v:1:y:2000:i:2:p:105-122
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    Citations

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    Cited by:

    1. Robert Dur & Hein Roelfsema, 2005. "Why does centralisation fail to internalise policy externalities?," Public Choice, Springer, vol. 122(3), pages 395-416, March.
    2. Guillaume Cheikbossian & Nicolas Marceau, 2007. "Why Is Law Enforcement Decentralized?," Cahiers de recherche 0719, CIRPEE.
    3. Toke S. Aidt & Jayasri Dutta, 2017. "Fiscal Federalism and Electoral Accountability," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 19(1), pages 38-58, February.
    4. Loeper, Antoine, 2017. "Cross-border externalities and cooperation among representative democracies," European Economic Review, Elsevier, vol. 91(C), pages 180-208.
    5. repec:got:cegedp:25 is not listed on IDEAS
    6. Fredriksson, Per G. & Matschke, Xenia & Minier, Jenny, 2010. "Environmental policy in majoritarian systems," Journal of Environmental Economics and Management, Elsevier, vol. 59(2), pages 177-191, March.
    7. Oliver Lorz & Gerald Willmann, 2008. "Enlargement versus Deepening: The Trade-off Facing Economic Unions," Working Papers of VIVES - Research Centre for Regional Economics 2, KU Leuven, Faculty of Economics and Business (FEB), VIVES - Research Centre for Regional Economics.
    8. Lorz, Oliver & Willmann, Gerald, 2005. "On the endogenous allocation of decision powers in federal structures," Journal of Urban Economics, Elsevier, vol. 57(2), pages 242-257, March.
    9. Guillaume Cheikbossian, 2016. "The political economy of (De)centralization with complementary public goods," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 47(2), pages 315-348, August.
    10. Grégoire Rota Graziosi, 2009. "On the Strategic Use of Representative Democracy in International Agreements," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 11(2), pages 281-296, April.
    11. Toke S. Aidt & Jayasri Dutta, 2017. "Fiscal Federalism and Electoral Accountability," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 19(1), pages 38-58, February.
    12. Oliver Lorz & Gerald Willmann, 2013. "Size versus scope: on the trade-off facing economic unions," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 20(2), pages 247-267, April.
    13. Peter Tuchyòa & Martin Gregor, 2005. "Centralization Trade-off with Non-Uniform Taxes," Working Papers IES 81, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised 2005.
    14. Paulo Julio & Susana Peralta, 2008. "Endogenous spillovers in the trade-off between centralization and decentralization," Nova SBE Working Paper Series wp538, Universidade Nova de Lisboa, Nova School of Business and Economics.

    More about this item

    Keywords

    JEL Classification:H30; H72; H73; Key words:Federalism; Distributive Politics; Strategic Voting; Decentralization; Local Public Goods;
    All these keywords.

    JEL classification:

    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects

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