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Political Yardstick Competition, Economic Integration, and Constitutional Choice in a Federation

  • Martin Bodenstein
  • Heinrich Ursprung

This paper investigates the behavior of rent-seeking politicians in an environment of increasing economic integration. The focus of the paper is on the implications of globalization-induced political yardstick competition for constitutional design with a view to the current discussion in the European Union. In contrast to the established literature, we carefully portray the double-tiered government structure in federal systems. The number of lower-tier governments and the allocation of policy responsibilities to the two levels of government are subject to constitutional choice.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2001/wp-cesifo-2001-06/cesifo_wp501.pdf
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 501.

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Date of creation: 2001
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Handle: RePEc:ces:ceswps:_501
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