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Journal ArticleDOI

Fiscal federalism and redistributive politics

01 May 1998-Journal of Public Economics (Elsevier BV)-Vol. 68, Iss: 2, pp 153-180

Abstract: We consider the interaction between redistributive politics at central and local levels in a federal system, and characterize the factors influencing success in redistributive politics in both federal and unitary systems. We examine how the political characteristics of different states and groups give them better or worse outcomes in a federal system as opposed to a unitary system. We examine possibilities of multiple equilibria with divided government between the two layers. We analyze the choice between block grants and matching grants. We also examine the impact of federalism on the incentives for geographic mobility.
Topics: Fiscal federalism (62%), Unitary state (53%), Federalism (53%)
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01 Jan 2002-
Abstract: List of Figures ix List of Tables xi Preface and Acknowledgments xiii Introduction 1 PART I: VETO PLAYERS THEORY 17 One: Individual Veto Players 19 Two: Collective Veto Players 38 PART II: VETO PLAYERS AND INSTITUTIONAL ANALYSIS 65 Three: Regimes: Nondemocratic, Presidential, and Parliamentary 67 Four: Governments and Parliaments 91 Five: Referendums 116 Six: Federalism, Bicameralism, and Qualified Majorities 136 PART III: POLICY EFFECTS OF VETO PLAYERS 161 Seven: Legislation 165 Eight: Macroeconomic Policies 187 PART IV: SYSTEMIC EFFECTS OF VETO PLAYERS 207 Nine: Government Stability 209 Ten: Judiciary and Bureaucracies 222 Eleven: Veto Players Analysis of European Union Institutions 248 Conclusion 283 Bibliography 291 Index 309

2,982 citations

Cites background from "Fiscal federalism and redistributiv..."

  • ...Riker (1975: 144) has made the argument that there should be no policy differences between federal and unitary countries, while Rose-Ackerman (1981) and Dixit and Londregan (1998) provide arguments why legislation will be different in these two types of states....


Posted Content
Abstract: EU regional policy is an investment policy. It supports job creation, competitiveness, economic growth, improved quality of life and sustainable development. These investments support the delivery of the Europe 2020 strategy. The present paper analysis two strategically different options of EU regional policy: place-neutral versus place-based policies for economic development. Our results suggest that in many EU regions the place-neutral policies may no be the best policy response to facing new challenges posed by deeper economic integration and globalisation.

757 citations

Daniel Treisman1Institutions (1)
01 Jul 2007-
Abstract: 1. Introduction 2. The political process 3. Administrative efficiency 4. Competition among governments 5. Fiscal policy and redistribution 6. Fiscal coordination and incentives 7. Citizens and government 8. Checks, balances, and freedom 9. Acquiring and using knowledge 10. Ethnic conflict and secession 11. Data to the rescue? 12. Conclusion: rethinking decentralization.

555 citations

Jonathan Rodden1Institutions (1)
26 Dec 2005-
Abstract: 1. Introduction and overview 2. Promise and peril: intellectual history 3. Sovereignty and commitment 4. The power of the purse: intergovernmental grants and fiscal discipline 5. Disease or cure? Political parties and fiscal discipline 6. An approach to comparative case studies 7. Fiscal federalism and bailouts in postwar Germany 8. The crisis of fiscal federalism in Brazil 9. The challenge of reform in federations 10. The origins of subnational sovereignty 11. Conclusions.

388 citations

01 Jan 2009-

333 citations

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Journal ArticleDOI
Abstract: NE of the most important recent developments in the area of "applied economic theory" has been the work of Musgrave and Samuelson in public finance theory.2 The two writers agree on what is probably the major point under investigation, namely, that no "market type" solution exists to determine the level of expenditures on public goods. Seemingly, we are faced with the problem of having a rather large portion of our national income allocated in a "non-optimal" way when compared with the private sector. This discussion will show that the Musgrave-Samuelson analysis, which is valid for federal expenditures, need not apply to local expenditures. The plan of the discussion is first to restate the assumptions made by Musgrave and Samuelson and the central problems with which they deal. After looking at a key difference between the federal versus local cases, I shall present a simple model. This model yields a solution for the level of expenditures for local public goods which reflects the preferences of the population more adequately than they can be reflected at the national level. The assumptions of the model will then be relaxed to see what implications are involved. Finally, policy considerations will be discussed.

11,481 citations

Journal ArticleDOI
Donald E. Stokes1Institutions (1)
Abstract: The use of spatial ideas to interpret party competition is a universal phenomenon of modern politics. Such ideas are the common coin of political journalists and have extraordinary influence in the thought of political activists. Especially widespread is the conception of a liberal-conservative dimension on which parties maneuver for the support of a public that is itself distributed from left to right. This conception goes back at least to French revolutionary times and has recently gained new interest for an academic audience through its ingenious formalization by Downs and others. However, most spatial interpretations of party competition have a very poor fit with the evidence about how large-scale electorates and political leaders actually respond to politics. Indeed, the findings on this point are clear enough so that spatial ideas about party competition ought to be modified by empirical observation. I will review here evidence that the “space” in which American parties contend for electoral support is very unlike a single ideological dimension, and I will offer some suggestions toward revision of the prevailing spatial model.

1,412 citations

Journal ArticleDOI
Assar Lindbeck1, Jörgen W. Weibull1Institutions (1)
01 Jan 1987-Public Choice
Abstract: This paper models balanced-budget redistribution between socio-economic groups as the outcome of electoral competition between two political parties. Equilibrium is unique in the present model, and a sufficient condition for existence is given, requiring that there be enough ‘stochastic heterogeneity’ with respect to party preferences in the electorate. The validity of Hotelling's ‘principle of minimum differentiation’, and of ‘Director's Law’, are examined under alternative hypotheses concerning administrative costs of redistributions, and voter's possibilities both of abstaining from voting and of becoming campaign activists for one of the parties. The policy strategy of expected-plurality maximization is contrasted with the strategy of maximizing the probability of gaining a plurality. Incomes are fixed and known, so lump-sum taxation is feasible. However, constraints on tax/transfer differentiation between individuals are permitted in the analysis.

1,398 citations

Journal ArticleDOI
Avinash Dixit1, John Londregan2Institutions (2)
Abstract: We examine what determines whether an interest group will receive favors in pork-barrel politics, using a model of majority voting with two competing parties. Each group's membership is heterogeneous in its ideological affinity for the parties. Individuals face a trade-off between party affinity and their own transfer receipts. The model is general enough to yield two often-discussed but competing theories as special cases. If the parties are equally effective in delivering transfers to any group, then the outcome of the process conforms to the "swing voter" theory: both parties woo the groups that are politically central, and most willing to switch their votes in response to economic favors. If groups have party affinities, and each party is more effective in delivering favors to its own support group, then we can get the "machine politics" outcome, where each party favors its core support group. We derive these results theoretically, and illustrate their operation in particular examples.

1,253 citations

Journal ArticleDOI
Gary W. Cox1, Mathew D. McCubbins1Institutions (1)
Abstract: Spatial models of electoral competition typically simplify the analysis by ignoring the question of internal constituency politics: constituencies are modeled simply as a distribution of ideal points along a set of issue dimensions. Matters related to the stability of divergent electoral coalitions have rarely been addressed. We explicitly take into account how differential rates of support by various groups in a constituency will influence candidates' campaign promises and the likelihood that stable electoral coalitions will be forged. Viewing campaign platforms as promised redistributions of welfare, we argue that the optimal strategy for risk-averse candidates will be to promise redistributions first and foremost to their reelection constituency and thereby to maintain existing political coalitions. We use evidence from the urban services literature to support our propositions.

1,051 citations

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