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The Assignment of Powers in Federal and Unitary States

Author

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  • Lockwood, B.

Abstract

This paper studies a model where the power to set policy (a choice of project) may be assigned to central or regional government via either a federal or unitary referendum (constitutional rule, CR). The benefit of central provision is an economy of scale, while the cost is political inefficiency. The relationship between federal and unitary CRs is characterized in the asymptotic case as the number of regions becomes large, under the assumption that the median project benefit in any region is a random draw from a fixed distribution, G.

Suggested Citation

  • Lockwood, B., 2000. "The Assignment of Powers in Federal and Unitary States," The Warwick Economics Research Paper Series (TWERPS) 569, University of Warwick, Department of Economics.
  • Handle: RePEc:wrk:warwec:569
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    File URL: https://www2.warwick.ac.uk/fac/soc/economics/research/workingpapers/2008/twerp569.pdf
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    References listed on IDEAS

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    1. Caillaud, B. & Jullien, B. & Picard, P., 1996. "National vs European incentive policies: Bargaining, information and coordination," European Economic Review, Elsevier, vol. 40(1), pages 91-111, January.
    2. repec:cup:apsrev:v:83:y:1989:i:04:p:1181-1206_08 is not listed on IDEAS
    3. Persson, Torsten, 1998. "Economic Policy and Special Interest Politics," Economic Journal, Royal Economic Society, vol. 108(447), pages 310-327, March.
    4. Timothy Besley & Stephen Coate, 1997. "An Economic Model of Representative Democracy," The Quarterly Journal of Economics, Oxford University Press, vol. 112(1), pages 85-114.
    5. Gilbert, Guy & Picard, Pierre, 1996. "Incentives and optimal size of local jurisdictions," European Economic Review, Elsevier, vol. 40(1), pages 19-41, January.
    6. repec:cup:apsrev:v:93:y:1999:i:01:p:69-83_21 is not listed on IDEAS
    7. Buchanan, James M, 1987. "The Constitution of Economic Policy," American Economic Review, American Economic Association, vol. 77(3), pages 243-250, June.
    8. Buchanan, James M, 1975. "A Contractarian Paradigm for Applying Economic Theory," American Economic Review, American Economic Association, vol. 65(2), pages 225-230, May.
    9. Bird, Richard M., 1993. "Threading the Fiscal Labyrinth: Some Issues in Fiscal Decentralization," National Tax Journal, National Tax Association, vol. 46(2), pages 207-27, June.
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    Cited by:

    1. Iregui, Ana Maria, 2005. "Decentralised provision of quasi-private goods: The case of Colombia," Economic Modelling, Elsevier, vol. 22(4), pages 683-706, July.

    More about this item

    Keywords

    DECENTRALIZATION ; GOVERNMENT ; REFERENDUM;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General

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