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Constitutional safeguards against centralization in federal states: An international cross-section analysis

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  • Roland Vaubel

Abstract

This paper contains an international cross-section analysis of the share of central government expenditure in total government expenditure for a sample of about 50 countries and a subsample of 23 industrial countries in 1989–91. The expenditure shares, their changes and the unexplained residuals for each country are reported in Table 1. As the analysis demonstrates, the share of central government is significantly lower, if income per capita and the country's area are large and if it is a federal state. The explanatory power of the equation rises considerably if the binary dummy for federalism is replaced by quantitative constitutional variables. The most powerful single explanatory variable is the age of the constitutional court in the complete sample or the constitutional court's independence of union institutions in the sample of industrial countries. The equation's explanatory power (adjusted for degrees of freedom) can be raised by allowing also for the degree of control which provincial institutions have over the constitution and over the second chamber and by taking into account whether an increase in federal tax rates requires a popular referendum. Other types of constitutional referenda and the relative age of the federal constitution do not seem to matter. Among the federal states, the share of central government is much larger than predicted in the United States and Mexico, and it is much smaller than predicted in Argentina and Canada. The constitutional variables are particularly helpful in explaining the relatively small share of central government in Switzerland, Malaysia, Germany and Austria. The last section draws conclusions for the design of constitutions with some special applications to the European Union. Copyright Kluwer Academic Publishers 1996

Suggested Citation

  • Roland Vaubel, 1996. "Constitutional safeguards against centralization in federal states: An international cross-section analysis," Constitutional Political Economy, Springer, vol. 7(2), pages 79-102, June.
  • Handle: RePEc:kap:copoec:v:7:y:1996:i:2:p:79-102
    DOI: 10.1007/BF00154116
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    File URL: http://hdl.handle.net/10.1007/BF00154116
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    Citations

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    Cited by:

    1. Hebous, Shafik & Weichenrieder, Alfons J., 2015. "Towards a fiscal union? On the acceptability of a fiscal transfer system in the eurozone," SAFE White Paper Series 28, Goethe University Frankfurt, Research Center SAFE - Sustainable Architecture for Finance in Europe.
    2. Jaroslaw Kantorowicz, 2014. "Judges as Fiscal Activists: Can Constitutional Review Shape Public Finance?," DANUBE: Law and Economics Review, European Association Comenius - EACO, issue 2, pages 79-104, June.
    3. Bernhard Boockmann, 2003. "Mixed Motives: An Empirical Analysis of ILO Roll-Call Voting," Constitutional Political Economy, Springer, vol. 14(4), pages 263-285, December.
    4. Boockmann, Bernhard, 2002. "Mixed motives: an empirical analysis of ILO roll-call votes," ZEW Discussion Papers 02-40, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    5. Beat Spirig & Rolf Weder, 2008. "To Wait or Not to Wait: Swiss EU-Membership as an Investment under Uncertainty," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 144(I), pages 85-114, March.
    6. Shafik Hebous & Alfons Weichenrieder, 2016. "Toward a Mutualization of European Unemployment Insurance? On Limiting the Downsides of a Fiscal Transfer System for the Eurozone," CESifo Economic Studies, CESifo, vol. 62(2), pages 376-395.
    7. Hans-Günter Krüsselberg, 2005. "Milton Friedman und der Wissenschaftliche Beirat für Familienfragen Elternkompetenz und Anteilscheine am Schulbudget – Gedanken über Reformpotenziale," Marburg Working Papers on Economics 200506, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    8. Roland Vaubel, 2013. "Secession in the European Union," Economic Affairs, Wiley Blackwell, vol. 33(3), pages 288-302, October.
    9. Lars P. Feld & Jan Schnellenbach & Christoph A Schaltegger, 2004. "On Government Centralization and Fiscal Referendums: A Theoretical Model and Evidence from Switzerland," Marburg Working Papers on Economics 200419, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    10. Kurrild-Klitgaard, Peter, 1998. "The constitutional dilemma of European integration," MPRA Paper 35437, University Library of Munich, Germany.
    11. Lars P. Feld & Gebhard Kirchgässner, 2003. "The Role of Direct Democracy in the European Union," CESifo Working Paper Series 1083, CESifo Group Munich.
    12. Lars Feld, 2005. "The European constitution project from the perspective of constitutional political economy," Public Choice, Springer, vol. 122(3), pages 417-448, March.
    13. Doering Detmar, 2000. "Austritt erlaubt? Die Verfassung der Europäischen Union braucht ein Sezessionsrecht," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 51(1), pages 383-404, January.

    More about this item

    Keywords

    H1; K3;

    JEL classification:

    • H1 - Public Economics - - Structure and Scope of Government
    • K3 - Law and Economics - - Other Substantive Areas of Law

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