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Political geography

  • Federico Etro

    ()

I study a model of geopolitical organization endogenizing the size of nations, their public spending and their degree of openness. The optimal geography may not be a stable equilibrium and a bias toward too many countries tends to emerge. An exogenous increase in openness tends to reduce the size of countries but also to increase the size of their public sectors. When openness is endogenous there can be multiple equilibria, some with globalization backlash associated with large nations and small governments and others with smaller countries, bigger governments and high openness. However, stable equilibria may imply excessive globalization, too many countries and too much government spending. Copyright Springer Science + Business Media, Inc. 2006

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File URL: http://hdl.handle.net/10.1007/s11127-006-2746-2
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Article provided by Springer in its journal Public Choice.

Volume (Year): 127 (2006)
Issue (Month): 3 (June)
Pages: 321-343

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Handle: RePEc:kap:pubcho:v:127:y:2006:i:3:p:321-343
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  1. Etro, Federico & Ageloni, Ignazio & Alesina, Alberto, 2005. "International Unions," Scholarly Articles 4553008, Harvard University Department of Economics.
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  10. 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.
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  14. Shin-Hwan Chiang & Ahmed Mahmud, 2008. "Federations, coalitions, and risk diversification," Public Choice, Springer, vol. 137(1), pages 403-426, October.
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  16. Federico Etro, 2006. "The Engine of Growth," Working Papers 100, University of Milano-Bicocca, Department of Economics, revised Oct 2006.
  17. Anke S. Kessler & Christoph Luelfesmann & Gordon M. Myers, 2007. "Federations, Constitutions, and Political Bargaining," Discussion Papers dp07-19, Department of Economics, Simon Fraser University.
  18. Federico Etro, 2003. "Globalization and Political Geography," CESifo Working Paper Series 986, CESifo Group Munich.
  19. Buchanan, James M & Faith, Roger L, 1987. "Secession and the Limits of Taxation: Toward a Theory of Internal Exit," American Economic Review, American Economic Association, vol. 77(5), pages 1023-31, December.
  20. Federico Etro, 2006. "Strategic Export Promotion," Working Papers 101, University of Milano-Bicocca, Department of Economics, revised Oct 2006.
  21. Federico Etro, 2004. "The Political Economy of Fiscal and Monetary Unions," Giornale degli Economisti, GDE (Giornale degli Economisti e Annali di Economia), Bocconi University, vol. 63(3-4), pages 289-328, December.
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