Contractual Federalism and Strategy-proof Coordination
This paper takes a mechanism design approach to federalism and assumes that local preferences are the private information of local jurisdictions. Contractual federalism is defined as a strategy-proof contract among the members of the federation supervised by a benevolent but not omniscient federal authority. We show that even if the size of the information to be elicited is minimal, the incentive compatibility constraint has a bite in terms of flexibility and welfare. Strategy-proof and efficient federal mechanisms are necessarily uniform. There exists inefficient and non-uniform strategy-proof mechanisms, but they are socially worse than non cooperative decentralization. Federal mechanisms which are neutral and robust to coalition manipulations are equivalent to voting rules on uniform policies.
|Date of creation:||Dec 2008|
|Date of revision:|
|Contact details of provider:|| Postal: |
Web page: http://www.kellogg.northwestern.edu/research/math/
More information through EDIRC
|Order Information:|| Email: |
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Barbera, S. & Sonnenschein, H., 1988.
"Voting By Quota And Committee,"
UFAE and IAE Working Papers
95-88, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- Salvador Barbera & Hugo Sonnenschein & Lin Zhou, 1990.
"Voting by Committees,"
Cowles Foundation Discussion Papers
941, Cowles Foundation for Research in Economics, Yale University.
- Antonio Estache & J. Cremer & Paul Seabright, 2005.
"Decentralizing Public Services: What can we learn from the Theory of the Firm?,"
ULB Institutional Repository
2013/44017, ULB -- Universite Libre de Bruxelles.
- Antonio Estache & J. Cremer & Paul Seabright, 1996. "Decentralizing Public Services: What can we learn from the Theory of the Firm?," ULB Institutional Repository 2013/44016, ULB -- Universite Libre de Bruxelles.
When requesting a correction, please mention this item's handle: RePEc:nwu:cmsems:1521. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Fran Walker)
If references are entirely missing, you can add them using this form.