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How defense shapes the institutional organization of states

Author

Listed:
  • Fabio Padovano

    (University of Rennes 1
    University of Roma Tre)

  • Yvon Rocaboy

    () (University of Rennes 1)

Abstract

Abstract We analyze theoretically how the provision of military services explains the vertical and horizontal fragmentation of a state. The model innovates on the previous political economy literature which views such institutional arrangements arising only as a response to internal ”technological” forces, not to strategic interactions within the state and with neighboring states. The model explains how these interactions lead communities of individuals to choose among three alternative types of institutional arrangements: 1) a union, i.e., a setting wherein both the vertical and the horizontal fragmentation of a state is minimized; 2) an alliance, whereby a state becomes more vertically fragmented by creating an upper government tier devised to take advantage of economies of scale; 3) autonomy, where horizontal fragmentation is maximized, as no merging of communities occurs and no higher government tier is created. A series of simulations of the model define the conditions under which each alternative institutional arrangement emerges in equilibrium.

Suggested Citation

  • Fabio Padovano & Yvon Rocaboy, 2018. "How defense shapes the institutional organization of states," Public Choice, Springer, vol. 175(1), pages 111-134, April.
  • Handle: RePEc:kap:pubcho:v:175:y:2018:i:1:d:10.1007_s11127-018-0516-6
    DOI: 10.1007/s11127-018-0516-6
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    References listed on IDEAS

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    More about this item

    Keywords

    Institutional organization; Military goods; Vertical and horizontal fragmentation; Strategic interactions between countries;

    JEL classification:

    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures

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