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An Economic Theory of Switzerland

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  • Charles B. Blankart

Abstract

Switzerland is often viewed as a federalist curiosity and a unique form of direct democracy. But this view does not provide a proper understanding of the country. A theory of Switzerland is necessary. A consideration of the initial, exogenous geographical situation of Swiss territory provides a better understanding of the country’s development. It was out of the frac-tured geography that the institutions of federalism and direct democracy as they are known today developed and established themselves. Although there was a trend to internal centralisation in the 20th century, the regional authorities have maintained their autonomy considerably better in Switzerland than in other states. An important factor is that the federal government, cantons and municipalities are each responsible for their own finances and debts. This stabilises not only the budget of regional and local authorities but also prevents interference on the part of the central government.

Suggested Citation

  • Charles B. Blankart, 2011. "An Economic Theory of Switzerland," CESifo Working Paper Series 3646, CESifo.
    • Handle: RePEc:ces:ceswps:_3646
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    References listed on IDEAS

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    1. Bean, Richard, 1973. "War and the Birth of the Nation State," The Journal of Economic History, Cambridge University Press, vol. 33(1), pages 203-221, March.
    2. Charles B. Blankart & Erik R. Fasten, 2009. "Wer soll für die Schulden im Bundesstaat haften? Eine vernachlässigte Frage der Föderalismusreform II," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 10(1), pages 39-59, February.
    3. Spoerer Mark, 2002. "Wann begannen Fiskal- und Steuerwettbewerb?: Eine Spurensuche in Preußen, anderen deutschen Staaten und der Schweiz," Jahrbuch für Wirtschaftsgeschichte / Economic History Yearbook, De Gruyter, vol. 43(2), pages 35-60, December.
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    Cited by:

    1. Feld, Lars P. & Kalb, Alexander & Moessinger, Marc-Daniel & Osterloh, Steffen, 2017. "Sovereign bond market reactions to no-bailout clauses and fiscal rules – The Swiss experience," Journal of International Money and Finance, Elsevier, vol. 70(C), pages 319-343.
    2. Lars P. Feld & Alexander Kalb & Marc-Daniel Moessinger & Steffen Osterloh, 2013. "Sovereign Bond Market Reactions to Fiscal Rules and No-Bailout Clauses - The Swiss Experience," CESifo Working Paper Series 4195, CESifo.
    3. Lars P. Feld & Alexander Kalb & Marc-Daniel Moessinger & Steffen Osterloh, 2013. "Sovereign Bond Market Reactions to Fiscal Rules and No-Bailout Clauses - The Swiss Experience," CESifo Working Paper Series 4195, CESifo Group Munich.
    4. Karsten Mause & Friedrich Groeteke, 2012. "New constitutional “debt brakes” for Euroland? A question of institutional complementarity," Constitutional Political Economy, Springer, vol. 23(4), pages 279-301, December.

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    More about this item

    Keywords

    fiscal federalism;

    JEL classification:

    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • N40 - Economic History - - Government, War, Law, International Relations, and Regulation - - - General, International, or Comparative

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