This paper builds on institutional analysis to generate new conclusions about the economic viability of federalism. It does so by suggesting that Weingast´s seminal model of marketpreserving federalism falls short of accounting for the poor fiscal performance of multitiered systems in the developing world. This theoretical deficiency stems to a large extent from the insufficient attention paid by this model to the institutional complexity of federal systems, particularly the public policy effects of legislative malapportionment. Subsequent to an analytical discussion of the potential public spending and distributive politics distortions resulting from overrepresentation, we offer preliminary empirical evidence from Argentina, a federation exhibiting one of the most decentralized fiscal systems in the world and severe imbalances in the territorial distribution of legislative and economic resources. The findings show not only that said imbalances lead to sub‐optimal fiscal results but also that they have a mutually‐reinforcing relationship with regionalized patronage.
in: Jan Erk / Wilfried Swenden (eds.), New Directions in Federalism Studies, London: Routledge, 2010, 68-82
Revista of Federal and Autonomic Studies, 11, 2010, 142-168
Regional and Federal Studies, 2009, 399-413
Revue Fédéralisme-Régionalisme, 9, 2009, 2
Journal of Public Policy, 26, 2006, 3, 255-277