The Impact of Referendums on the Centralisation of Public Goods Provision: A Political Economy Approach
AbstractThe paper compares decision-making on the centralisation of public goods provision in the presence of regional externalities under representative and direct democratic institutions. A model with two regions, two public goods and regional spillovers is developed in which uncertainty over the true preferences of candidates makes strategic delegation impossible. Instead, it is shown that the existence of rent extraction by delegates alone suffices to make cooperative centralisation more likely through representative democracy. In the non-cooperative case, the more extensive possibilities for institutional design under representative democracy increase the likelihood of centralisation. Direct democracy may thus be interpreted as a federalism-preserving institution.
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Bibliographic InfoPaper provided by University of Heidelberg, Department of Economics in its series Working Papers with number 0440.
Length: 36 pages
Date of creation: May 2007
Date of revision: May 2007
centralisation; direct democracy; representative democracy; public good provision.;
Other versions of this item:
- Jan Schnellenbach & Lars Feld & Christoph Schaltegger, 2010. "The impact of referendums on the centralisation of public goods provision: a political economy approach," Economics of Governance, Springer, vol. 11(1), pages 3-26, February.
- Jan Schnellenbach & Lars P. Feld & Christoph A. Schaltegger, 2006. "The Impact of Referendums on the Centralisation of Public Goods Provision: A Political Economy Approach," CESifo Working Paper Series 1803, CESifo Group Munich.
- H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
- H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
- 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
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-06-18 (All new papers)
- NEP-CDM-2007-06-18 (Collective Decision-Making)
- NEP-PBE-2007-06-18 (Public Economics)
- NEP-POL-2007-06-18 (Positive Political Economics)
- NEP-URE-2007-06-18 (Urban & Real Estate Economics)
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