Of federalism puzzle,theory, and evidence from nineteenth. In spite of perfect and nonoverlapping division of powers, national concern and maintenance of uniform standards automatically makes the national government a dominant force naturally. For a number of largely unrelated reasons, interest in both the theory and. Political and economic theories of federalism oxford.
Fiscal federalism in theory fiscal federalism has been defined and measured in various ways, but following riker 1964, 11, weingast 1995, 4, and rodden 2004, we can identify the following elements of the ideal type. Although politicaleconomic theories of decentralization show how. Apart from theory, federalism has also its geography and history, which is evident if one bears in mind that it most frequently appears in certain historical eras and on certain continents, more often than somewhere else. It is not easy to draw a line between what is state and what is federal e. By delimiting federal states in terms of defining institutional features, federalism scholars put themselves at the margin rather than the centre of where the action is. Taxbase and revenuesharing concepts and transfer mechanisms are then introduced briefly. The theory and practice of federalism as a structural mechanism of. War, the theory of federalism can hardly be said to provide a satisfactory basis for the understanding of a system of government so widespread in its application. Federalism and constitutional change, clarendon press, oxford, 1956. Federalism, especially in large or diverse countries, can also improve service delivery. Political science scholarship on this question has noted a paradox about federations. Wheares legalinstitutional theory of federalism has proven not to be a timetested and a comprehensive theory going by his view of federalism as a federal principle of dividing power between the general and regional governments as spelt out in a. The study of federalism construed in its broadest sense is fraught with difficulties that are reflected in both theory and practice.
Section four combines the insights acquired in this analysis with location of the key attributes of federalism to construct a valid definition of the concept. This project pulls together classic and modern readings and essays that explore theories of federalism. The term federal has both an empirical and a theoretical resonance. The paper argues that second generation theory is an ongoing.
A concluding section brings together the main themes of the fiscal federalism literature. The main aim in this paper is to argue that the rikerian theory of federal formation is inadequate to explain the origin of the nigerian federation, especially in the. In other words, discussion on contemporary federalism usually starts with k. The autonomy of territorially circumscribed units is vital to federalism. In theory liberals supposedly fear state autonomy, want uniform national laws to ensure justice and equality, for example in the introduction and nationalization of civil rights laws, while conservatives purportedly want state autonomy for sake of more liberty reagans new federalism, devolution.
Federalism, especially in large or diverse countries, can also improve service delivery and democratic resilience, ensure decisions are made at. The chief concern of the classical theory is to explain what federalism is. The theory, practice and current trends in federalism. Narrow interpretation of elastic clause implied power and states rights cooperative federalism. Coercive, cooperative, and collaborative federalism in. Political scientists and economists alike have long studied the effects of fiscal federalism on economic growth, government spending and debt, and inequality in theory and in practice. The study has critically analysed the first generation theory and second generation theory of fiscal federalism. Approaches to a fiscal theory of political federalism. It concludes that since different countries that adopt the federal principle, are different in many. Toward a secondgeneration theory of fiscal federalism. The second section distinguishes the concept from related but different concepts of consociation, decentralization, and democracy, both local and general. The goal is to correct market failures through government action, and its guiding principle is to assign policy responsibility to the smallest level of government that can accomplish the.
Ann althouse, variations on a theory of normative federalism. In the midst of an ongoing dialogue about the respective powers of the state and national governments, voices on both sides agree that. This view is based on a study of the constitution and system of government obtaining in the four classical federations, namely, the united states of america switzerland, canada and the. In the modern period, the constitution of the united states, of 1787, is treated as the first experiment in establishing a. However, attempts to test the theory of fiscal federalism have often run aground on conceptual and measurement problems. Though the later approaches the problem of fiscal federalism from different perspective, it does not challeng but complements the former. It is surprising that federalism has not generated.
Musgrave university of michigan the preceding paper deals with the fiscal structure of a community as determined by considerations of economic efficiency. On the other hand, economic theories emphasize the efficiency and equity impacts on resource allocation, for private as well as public goods and services. This pdf is a selection from an outofprint volume from the national bureau of economic research volume title. According to them, the classical theory explains the nature of. Towards a normative theory of federalism wiley online library. Needs, sources, and utilization volume authoreditor. A theory of federalism, as opposed to a theory of decentralization, must explain how subnational institutions can actually be provided with decisionmaking powers in certain domains. In this book i shall argue that while such a thing as federal theory does exist, there is, as yet, no fully fledged theory of federalism. It explains that the political theories see federalism as a bargain among constituent units of the federation to preserve group identities while ensuring security and stability. The classical federalism is the route of many third world countries that are federal in character. These considerations demanded central provision for services the benefits.
So wrote justice sandra day oconnor in 1991 in coleman v. Drawing on a wide range of literature and ideas, a new secondgeneration theory of fiscal federalism is emerging that provides new insights into the structure and working of federal systems. Federalism specifies three important issues like perfect demarcation of powers, need of autonomy for both central and regional government, coordination between central and regional government. Pdf federalism as a political ideology and system of. Calling these leagues federal may seem anachronistic. Those identifying with the subunits states are also frustrated.
Federalism, the division of sovereign authority among levels of government, can be seen as a way of stabilizing, or making credible, decentralized governmental structures. The economic theory of federalism has become the starting point for most scholarly and policy discussions as to how best to organize the federal state. Wheares legalinstitutional theory of federalism has proven not to be a timetested and a comprehensive theory going by his view of federalism as a federal principle of dividing power between the general and regional governments as spelt out in a federalwrittenrigid constitution. From the analysis it is crystal clear that, the two tier government system and judicious autonomy of these two governments are the essential characteristics of any federal government. Spanning the seventeenth through twentyfirstcenturies of european, u. The goal is to correct market failures through government action, and its guiding principle is to. Samuelsons two important papers, on the theory of public goods, arrows discourse on the roles of the public and private sectors and musgraves book. A political theory of federalism1 jenna bednar2 william n. The challecges of the twentieth century such as wars and depression, economic planning and social services have made the classical theory of federalism an obsolete. Broad interpretation of necessary and proper clause and what the tenth amendment actually states conservatives favor the layercake metaphor, and liberals favor the marble cake or cooperative federalism. The revival of federalism in normative political theory. Pdf this project pulls together classic and modern readings and essays that explore theories of federalism.
By studying the conditions and incentives of subnational government authority and policymaking, this perspective provides a comparative theory of federal performance. The theory of fiscal federalism addresses three issues related to fiscal decisionmaking. Federal theory and federalism in africa berihun gebeye. If federalism is indeed a rational bargain aimed at a paretooptimal outcome, then in every successfully formed federalism it must be the case that a significant external or internal threat or a significant opportunity for aggression is present, where the threat can be forestalled and the aggression. Its critics attack the theory on the ground of legal formalism. The origins of federal theory in international relations ideas jstor. The national taxing and spending powers and their federalism based limits and the taxing power as a regulatory device, cb p. It is not obvious, for example, that the division of sovereignty is actually possible. As federalism follows new pathways in africa, this article shows how its system of operation and standards of assessment take a similar course. Theories of federalism federalism is a political system where local units of government, as well as the national government, can all make final decisions with respect to some governmental activities.
Of federalism puzzle, theory, and evidence from nineteenthcentury europe by daniel ziblatt i. An alternative political language in the early era of centralized states. The first real theories of federation were formulated in response to the rise of centralized modern states and to the theory of sovereignty that came. A carefully specified theory of federalism has many useful applications. For example, this report does not examine the role of federalism as a political system or as a protection against tyranny.
Beer, of course, is also intent on showing that the. My purpose in this paper is to explore this wideranging literature in. As originally developed by musgrave 1959 and oates 1972, the theory of fiscal federalism con. Download as pdf abstract traditional federal theory seems no longer apt to grasp recent evolutions in state structures. However, the federal solution not without its own problems. Madisonian theory holds that a federal division of power is necessary to the protection of liberty, but that federalism is a naturally unstable form of government organization that is in constant danger of collapsing into either unitarism or fragmentation. Federalism is a tragic compromise in that those identifying with the nation are not satisfied because national identity is truncated. To speak of a secondgeneration theory, however, implies the existence of a. From fiscal equity to the ideal political order, freiburger diskussionspapiere zur ordnungsokonomik. Federalism is a means of ensuring peace, stability and mutual accommodation in countries that have territorially concentrated differences of identity, ethnicity, religion or language. The existence or otherwise of a federal constitution is not a consideration, and the principles of fiscal federalism apply to both unitary and federal countries2. Federalism berkeley law university of california, berkeley. It relies on the theory of intergovernmental relations as an explanatory variable.
Theory and practice the field of fiscal federalism studies how to divide responsibilities including finances among federal, state, and local governments to improve economic efficiency and achieve various public policy objectives. The theory of federalism international journal of current. Introduction state builders and political reformers frequently seek a federally organized political system. A discussion of the federal constitutional provisions is followed by an analysis of the policies and politics that has str engthened feder ali sm in practice. Thus reincarnating laskis 1948 position that liberty in a state cannot be pres erved without a measure of federalism embe.
Introduction multiethnic nations south africa, russia, nigeria, rwanda, the former yugoslavia, to name a few have sometimes found decentralized political arrangements attractive. Bird university of toronto the analysis of the problems that give rise to, and arise from, the existence of more than one level of government within the same geographical area. Theory of fiscal federalism the basic foundations for the initial theory of fiscal federalism were laid by kenneth arrow, richard musgrave and paul sadweh samuelson. Against the central ethos of classic federal theory, federalism in africa manages to operate and, to the extent. From a geographic point of view, federalism belongs rather to the new world, i. On the other hand, economic theories emphasize the efficiency and equity impacts on resource allocation, for private as well as public goods and. Theory and practice congressional research service 2 weighing the merits of potential changes to government activity levels. Daniel elazar, gives readers some insight into the origins and theory of federalism by a worldrenowned scholar of federalism. Much, of course, will depend upon how one identifies federal states and how one calculates which states are. Towards the end of the chapter, we turn to the local government, a new and third tier of indian federalism. Second, are the leading theories of federalism, as framed in judicial opinions and in the academic literature, plausible characterizations of the.
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