ChapterPDF Available

Economic crisis and federal dynamics

January 2013

DOI:10.1093/acprof:oso/9780199652990.003.0016

In book: Federal Dynamics: Continuity, Change, and the Varieties of Federalism (pp.343)
Chapter: Economic Crisis and Federal Dynamics
Publisher: Oxford University Press
Editors: Arthur Benz, Jörg Broschek

Authors:

Dietmar Braun

University of Lausanne

Philipp Trein

University of Lausanne

Content uploaded by Philipp Trein

Content may be subject to copyright.

ECONOMIC CRISIS AND FEDERAL DYNAMICS

DIETMAR BRAUN AND PHILIPP TREIN

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1 Introduction+

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4.1 Temporary,reduction,of,discretion,

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=>C>P' Z+0Bm(+[' =>>DP'61$%"' OB+0%<1"' j+01.(' >`n=>>DP' 61$%"' OB+0%<1"' j+01.(' C=n=>>DP' V+0<-' ,0+##'

>bnCan=>C>E' O&#$01.%1S' O"(+0#-"' 1"(' e+""1' =>C>P' ]*UY' =>C>P' W$+K+$++' =>>DP' J100+"' =>C>E' O&#$0%1S'

Z0+&##2'M1"%-4#K%'1"(' W<801$[+"#$1..+0'=>>DP']*UY' =>>DP' ]*UY'=>CCP' ocZ' =>>DP' ocZ' =>C>E' Z+.9%&BS'+

]*UY' =>>DP' ]*UY' =>CCP' (A1' C>nCIn=>C>P' cpp' >gnC=n=>C>P' cpp' C>n>In=>CCP' WA%+9+.L]".%"+'

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>`n=`n=>>DP'cpp'>Cn=>n=>C>E'3WOS'M%"<1%('=>C>P']*UY'=>C>P'7100'=>C>E

81(' ^4-%<+_' %"' ;+(+01.' (+<%#%-"LB1K%"92' 1#' ;-0' +H1BA.+' %"' WA1%"' 1"(' Q+0B1"G2'

<-BA0-B%#+#'@+0+'+1#%.G'1<8%+4+(2'&#&1..G'<-";%0B%"9'UQ'%"$+"$%-"#E''

U-"(%$%-"1.' 901"$#' 814+':++"' 1' &"%4+0#1..G' &#+(' %"' ;+(+01$%-"#E`'78+G'10+' +HA+<$+(' $-'

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<1"' 1.#-' &#+' #&<8' 901"$#' $-' %BA.+B+"$' <+0$1%"' A-.%<%+#2' 1#' ]:1B1' O(B%"%#$01$%-"' (%('

@8+"' %"#%#$%"9' -"' #A+"(%"9' %"' 1.$+0"1$%4+' +"+09%+#E' e-0'VW' $8+' <-"#$01%"$#' (&+' $-'

#A+"(%"9'0&.+#'10+'<-BA+"#1$+(':G'$8+'%";.&H'-;'1((%$%-"1.'B-"+G'$8+G'&#&1..G'"++('$-'

<-B:1$'$8+'<0%#%#E'78%#'01%#+#'$8+'/&+#$%-"'@8+$8+0'<-"(%$%-"1.'901"$#'9%4+'UQ'1'.+4+0'$-'

0+L#8&;;.+';+(+01.'0+.1$%-"#'-;'A-@+0E'

Z1#+(' -"' -&0' ;%"(%"9#2'@+' <1"' (%#$%"9&%#8' $80++' $GA+#' -;' 0+1<$%-"#' :G' VW' $-' $8+'

#&AA.G'-;'<-"(%$%-"1.'901"$#'-;'$8+'UQS''

NCR'!"'O&#$0%12'Q+0B1"G2'WA1%"2'O09+"$%"12'1"('W-&$8'O;0%<1'<-"(%$%-"1.'901"$#'@+0+'

&#&1..G' <-"<+%4+(' 1#' 1((%$%-"1.' %"<-B+' -;' VW2' $8-&98' -;' B%"-0' %BA-0$1"<+' $81"'

0+4+"&+#'91%"+(';0-B'$1HL#810%"9'1001"9+B+"$#E'Y&0%"9'$8+'+<-"-B%<'<0%#%#'<-"(%$%-"1.'

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-:F+<$' $8+B' %"' A10.%1B+"$#' -0' <--0(%"1$%-"' :-(%+#E' !"' 9+"+01.2' $8+G'A10$%<%A1$+(' %"'

%BA.+B+"$%"9'$8+'901"$#E''

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1"('<--A+01$%-"'%"'&#%"9'#&<8'901"$#E'!"':-$8'<-&"$0%+#2'UQ'1"('VW'"+9-$%1$+('%";-0B1.'

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1"(';%"1"<%1.'<%0<&B#$1"<+#'%"'$8+#+'$@-'<-&"$0%+#'8+.A+('$-';%"('#&<8'1'<-"#+"#&#E'

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<-"(%$%-"1.' 901"$#' (&0%"9' $8+' <0%#%#' <1&#+(' $+"#%-"#' :+$@++"' UQ' 1"(' VW' %"' $8+'

%BA.+B+"$1$%-"E'!"'O&#$01.%1'1"('$8+'3W2'<-"(%$%-"1.'901"$#'10+'$8+'-".G'B+1"#'-;'$8+'UQ'

$-' %";.&+"<+' A-.%<%+#'-;' VWE' !"' :-$8' <-&"$0%+#' VW' 1(B%"%#$+0' %BA-0$1"$' 10+1#' -;'

+HA+"(%$&0+'1"('%"4+#$'%"'%";01#$0&<$&0+E'

!"'O&#$01.%12'$8+'"&B:+0'-;'<-"(%$%-"1.'901"$#'%"<0+1#+('(&0%"9'$8+'<0%#%#'1"('<1&#+('

$@-' K%"(#' -;' $+"#%-"#S' 78-&98' VW' A10$%<%A1$+(' %"' $8+' ;-0B&.1$%-"' -;' $8+' #$%B&.&#'

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@8+"' VW' %BA.+B+"$+(' $8+' A0-901B#' L' (+#A%$+' "+@' A0-<+(&0+#E' 78+' r0+(' $1A+r' %"' VW'

@1#':.1B+(';-0'1'#&:-A$%B1.'1AA.%<1$%-"'-;'UQ'0+#-&0<+#'-"'$8+'0+9%-"1.'.+4+.'NJ100+"'

`e-0' Z+.9%&B2' @+' .1<K' <.+10' %";-0B1$%-"' 1:-&$' $8+' &#+' -;' <-"(%$%-"1.' 901"$#E' U-"(%$%-"1.' $01"#;+0#' 10+'

<-"#%(+0+(' $-' :+' 191%"#$' <-"#$%$&$%-"1.' 0&.+#' :&$' $8+G' 10+' &#+(' -"' 010+' -<<1#%-"#' NZ-1(@1G' 1"(' W818'

=>>?RE'!$'%#'$8+0+;-0+'.%K+.G'$81$'(&0%"9'$8+'0+<+"$'<0%#%#'$8+'&#+'-;'<-"(%$%-"1.'901"$#'@1#'14-%(+(E

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$-'@1#$+'A&:.%<'B-"+G'N,-@+..'1"('W$+G$.+0'=>C>RE'

!"' !"(%12' VW' -:$1%"+(' 1' .109+' 410%+$G' -;' <-"(%$%-"1.' 901"$#' ;0-B' (%;;+0+"$' ;+(+01.'

B%"%#$0%+#'1.0+1(G' :+;-0+'$8+'<0%#%#E' 78%#'A01<$%<+'@1#' %"$+"#%;%+('(&0%"9' $8+' <0%#%#'1"('

<-"$0%:&$+('$-'1'9+"+01.'#+"$%B+"$'-;'r8-..-@%"9'-&$r'-;'$8+';%#<1.'1&$8-0%$G'-;'VWE'78%#'

#+"$%B+"$' @1#' %"(&<+(' :G' -$8+0' B+1#&0+#2' $8+'UQ' %"$0-(&<+(' 1$' $8+' :+9%""%"9' -;' $8+'

<+"$&0G'$-'0+(&<+'$8+'(%#<0+$%-"'-;'VWE'e-0'%"#$1"<+2'1're%#<1.'d+#A-"#%:%.%$G'1"('Z&(9+$'

V1%"$+"1"<+'61@r'<-"#%(+01:.G'<&0$1%.+('$8+'A-##%:%.%$%+#'-;'VW'$-'+"919+'%"'"+@'(+:$#P'

1'"+@'XO7'#G#$+B'.%B%$+('A-@+0#'-;'VW'$-'+H$+"('$8+%0'$1H':1#+'1"('$-'%"<0+1#+'-@"'$1H'

01$+#P' 78+' UQ'<1AA+(' VW' #$1BA' $1H' 01$+#2' @8%<8' <-"$0%:&$+(' $-' bl' -;' $8+%0' 0+4+"&+E'

J%$8' $8+#+' (+<%#%-"#2' $8+' UQ' 1%B+(' 1$' 901(&1..G' 0+(&<%"9' $8+' $1H' #810+#'-;'VWE' 78+'

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1&$8-0%$G'%$'81('.-#$':+;-0+'%"'$8+'A0-<+##'-;'(+<+"$01.%[1$%-"E'78+'<0%#%#'@1#'$8+0+;-0+'1"'

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!"' $8+' 3EWE2' <-"(%$%-"1.' 901"$#' @+0+' /&%$+' <-BB-"' %"' %"$+09-4+0"B+"$1.' 0+.1$%-"#E'

78+G' @+0+' 1.#-' $8+' B1%"' %"#$0&B+"$' -;' $8+' ]:1B1' O(B%"%#$01$%-"' $-' %";.&+"<+' VW'

#A+"(%"9' :+814%-0E' 78+' UQ' (+<%(+(' -"' $8+#+' 901"$#' @%$8-&$' A10$%<%A1$%-"' -;' VWE'

U--0(%"1$%-"' (%(' "-$' $1K+' A.1<+E' !"' <-"$01#$' $-' $8+' <-&"$0%+#' (%#<&##+(' :+;-0+2' $8+'

9+"+01.'1<<+A$1"<+'-;'$8+#+'901"$#':G'VW'@1#'@+1KE']".G'1:-&$'-"+'$8%0('-;'$8+'B-"+G'

$8+'UQ' -;;+0+('@1#'+;;+<$%4+.G' #A+"$E'j%98' 1(B%"%#$01$%4+'<-#$#' 1"('410%-&#' <-"(%$%-"#'

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NM%"<1%('=>C>P'7100'=>C>RE''

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1&$8-0%$G'0+.1$%-"#'+4+"'%;'UQ'(+;%"+('$8+'A&0A-#+#'-;' #&<8' 901"$#E' !"' $8+' ;%0#$' 90-&A'-;'

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]".G' %"' $8+' ;+(+01$%-"#' ;-0B%"9' $8+' .1#$' 90-&A2' <-"(%$%-"1.' 901"$#' @+0+' <-"$+#$+(' $-'

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9+"+01.'#$01$+9G'-;'UQ'$-'0+#$-0+'.-#$'1&$8-0%$G'%"';%#<1.'0+.1$%-"#E''

4.2 Acts,of,defiance,

78+'#+<-"('<81..+"9+';-0'$8+'#$1:%.%$G'-;'$8+';+(+01.':1.1"<+'-;'A-@+0'0+#&.$';0-B'1<$#'

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:+$@++"' rdeficit+ spending"'1"(' 1<8%+4%"9+ "budget+ balance".'!"' <-"$01#$' $-' +10.%+0'

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@+1K+"%"9'$8+'<+"$0+'+4+"';&0$8+0E'J%$8%"' $8%#' <-"$+H$2'$8+'+<-"-B%<'<0%#%#'81('"-'

<+"$01.%[%"9'+;;+<$E'

!"' <-"$01#$' $8+' %BA1<$' -;' $8+' +<-"-B%<' <0%#%#' %#' B-0+' <.+10.G' 4%#%:.+' %"' ;+(+01.'

<-&"$0%+#'@%$8'1"'oscillating+equilibrium+of+powerE'

− !"'India2'$8+'+<-"-B%<'<0%#%#'@1#'"-$'$8+'<1&#+'-;'#$01$+9%+#'-;'UQ'$-'0+L#8%;$'$8+';%#<1.'

:1.1"<+'%"'%$#';14-0E'O'"&B:+0'-;'<+"$01.%[%"9'B+1#&0+#'@+0+'$1K+"':+;-0+'$8+'<0%#%#2'

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1#'$8+'(-B%"1$%"9'19+"<G'$81$'<1"'1$'.%:+0$G'(+$+0B%"+'$8+'<1A1<%$G'-;'VW'$-'1<$'N:G'

+1#%"9'(+:$'.%B%$#'1"(':G'&#%"9'<-"(%$%-"1.'901"$#RE'78%#2'-;'<-&0#+2'<-"$0%:&$+#'1.#-'

$-'$8+' %B19+' -;' .+1(+0#8%A' -;'$8+' UQ' 1"(' B1G' %"';&$&0+' 8+.A'$-' 0+;-0B' $8+' ;+(+01.'

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!"(%1E''

− 78+'#1B+'1AA.%+#';-0'SpainE'j+0+'$8+' <0%#%#' <.+10.G'#$0+"9$8+"+('$8+'.+1(%"9'0-.+'-;'

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$-'$0+#A1##'$8+'1&$8-0%$G'-;'VWE'W+0%-&#';%#<1.'%B:1.1"<+#'.+('$-'1&$8-0%$G'B%901$%-"'

%"'(+A$'A-.%<GE']"'$8+'-$8+0'81"(2'+;;-0$'$-'<-"$%"&+'@%$8'(+<+"$01.%[1$%-"'1%B+('1$'

$01"#;+00%"9'B-0+'$1H'0+#-&0<+#'$-'VWE'Y+<+"$01.%[1$%-"'1"('<+"$01.%[1$%-"'10+':-$8'

#$%..'4%0&.+"$';-0<+#'%"';%#<1.'0+.1$%-"#E'j-@+4+02'$8+'@+1K+"%"9'-;'0+9%-"1.'A10$%+#'%"'

$8+' ;+(+01.' A10.%1B+"$' <-&.(' 4+0G' @+..' #%9"%;G' $81$' $8+' B-4+#' $-' 9%4+' UQ' B-0+'

<1A1<%$%+#' $-' 1<$' <-&.(' 9-' B&<8' ;&0$8+0E' !"' WA1%"' $8+0+;-0+' -"+' <1"' +HA+<$' B-0+'

<+"$01.%[1$%-"'1"('1'@+1K+"%"9'-;'$8+'(+<+"$01.%[1$%-"'A0-<+##E''

− !"' Argentina2' "-' 0+;-0B#' #&<<++(+(' :&$' $8+' UQ' (+B-"#$01$+(' %$#' (-B%"1"$' 0-.+' %"'

$8+'<0%#%#E'!$'+H$+"(+('%$#';%"1"<%1.'<1A1<%$%+#'1"('%BA-#+('%$#'#$01$+9%+#'-"$-'VW':G'

<-"(%$%-"%"9'+H$01' $01"#;+0#'-;' $1H+#E'78%#' #8-&.('9%4+' 1'#GB:-.%<' :--#$'$-' UQ'$81$'

$8+'"+@'M%0<8"+0'9-4+0"B+"$'<-&.('&#+'$-'#$0+"9$8+"'%$#'A-#%$%-"'4%#LiL4%#'VWE'

!"'$8+'stable+federal+countries'@+'(-'"-$';%"('0+.+41"$'1$$+BA$#'$-'#8%;$'$8+'#$1$&#'/&-E'

Z&$'+4+"'8+0+'$8+'<0%#%#'.+;$'%$#'B10K#E''

− Switzerland' 81#' #&04%4+(' $8+' <0%#%#' @%$8-&$' 1"G' 0+B10K1:.+' /&+#$%-"%"9' -;'

+H%#$%"9' ;+(+01.' #$0&<$&0+#E' 78+0+' @1#' 1' 9+"+01.' <--A+01$%4+' 1$$%$&(+' 1$' $8+'

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$8+';&$&0+E''

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Germany'81#' 0+B1%"+('&"<-"$+#$+(E' !$'@1#' $8+0+;-0+' r:&#%"+##'1#' &#&1.r'@8+"'

$8+' UQ' $--K' $8+' .+1(' $-' ;%98$' 191%"#$' $8+' +<-"-B%<' <0%#%#E' 78+' A-.%<%+#' B1%".G'

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-0(+0E'

− Y+4+.-AB+"$#'814+' :++"'#%B%.10' %"'Australia2' @8+0+'$8+' UQ'<-";%0B+(' %$#';%#<1.'

(-B%"1"<+' :G' $1K%"9' $8+' .+1(' %"' <-B:1$%"9' $8+' +<-"-B%<' <0%#%#E' Y%#<&##%-"#'

%"(&<+(':G'$8+' <0%#%#' <-"<+0"'&"#-.4+('A0-:.+B#' -;'0+('$1A+' %"';%#<1.'0+.1$%-"#E'

W&<8' (%#<&##%-"#' ;.10+' &A' ;0-B' $%B+' $-' $%B+' 1"(' $8+' +<-"-B%<' <0%#%#' 914+'

109&B+"$#'$-' UQ'$-' /&+#$%-"' $8+'+;;%<%+"<G' -;'$8+' ;%#<1.'-0(+0' @%$8-&$' 8-@+4+0'

.1&"<8%"9' 1"G' <-"<0+$+' 0+;-0B' A0-A-#1.#' &"$%.' "-@E' W$1:%.%$G' @1#' $8+0+;-0+'

B1%"$1%"+(E''

− 78+' U.S.2' ;%"1..G2' (%(' "-$' #++' 1"G' 0+;-0B' 1$$+BA$#' -;' ;+(+01.%#B' %"(&<+(' :G' $8+'

<0%#%#E'78+'+B+09%"9'<-BA.1%"$#'1:-&$'$8+'<-"(%$%-"1.'901"$#'@+0+'"-$8%"9'"+@E'

Z&$'(%#<&##%-"#'B1G'4+0G'@+..'#$10$'%"'$8+'"+10';&$&0+':+<1&#+'-;'$8+'0+.&<$1"<+'

-;' VW' $-' 1<<+A$' $8+#+' 901"$#' -0'$8+' <-"#$01%"$#' $-' :1.1"<+' $8+%0' :&(9+$E' VW'

$8+B#+.4+#'10+'-;$+"'1$'$8+':0%"K'-;';%"1"<%1.'(%#1#$+0'@%$8';.10%"9'(+:$'01$+#2':&$'

$8+G' <1""-$' 0+.G' -"':1%.' -&$' :G' $8+' UQ' -0'-"'1"' +;;%<%+"$' ;%"1"<%1.' +/&1.%[1$%-"'

#G#$+B' $81$' <-&.(' 8+.A' $-' #$1:%.%[+' $8+%0';%"1"<%1.' #%$&1$%-"E' 78+#+' #$0&<$&01.'

@+1K"+##+#' %"' $8+' +H%#$%"9' ;%#<1.' 0+9%B+2' @8%<8' 8%"(+0+('#-.&$%-"#' $-' :-$8' $8+'

+<-"-B%<'1"('$8+';%"1"<%1.'<0%#%#2'B1G';-0<+':-$8'#%(+#'$-'+"$+0'%"$-'"+9-$%1$%-"#'

1:-&$'1'<81"9+'%"'$8%#'0+9%B+E'+

6 Conclusion+

7-'#&B'&A2'@+';%"('B-0+'<-"$%"&%$G'$81"'<81"9+'(&0%"9'$8+'+<-"-B%<'<0%#%#'-;'=>>I'

1"(' =>>DE' WA+<$1<&.10' $&0"10-&"(#' L' ;0-B' (+<+"$01.%[+(' $-' <+"$01.%[+(' :1.1"<+#' -;'

A-@+0'T' -0' +4+"'1' <.+10' $0+"('$-@10(#'#$0+"9$8+"%"9' <+"$01.'1&$8-0%$G'814+' "-$'$1K+"'

A.1<+E' !"' A0%"<%A.+2' 1"' +<-"-B%<' <0%#%#' <1"' 814+' .-"9L.1#$%"9' <+"$01.%[%"9' +;;+<$#' -"'

;+(+01.' #$0&<$&0+#' 1#' $8+' Q0+1$' Y+A0+##%-"' (+B-"#$01$+(E' 78+' #$0&99.+' ;-0' ;%#<1.'

1&$8-0%$G'%#'<+0$1%".G'1'B1F-0':1$$.+;%+.('%"';+(+01$%-"#2'1#'(%#<0+$%-"'1:-&$'0+4+"&+#'1"('

+HA+"(%$&0+#' (+$+0B%"+#' $8+' <1A1<%$G' -;' 1..' $+00%$-0%1.' 1<$-0#' $-' 1<$E' 781$' @+' (%(' "-$'

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0+.1$%4+.G' .%B%$+(' +;;+<$#' $8+' <0%#%#' 81(' -"' #-<%1.' 1"(' +<-"-B%<' @+.;10+E' 78+' B+1#&0+#'

$1K+"' @+0+' -;$+"' #&;;%<%+"$' $-' -4+0<-B+' $8+' (+B1"(' <0%#%#' 1"(' 0+#&.$+(' %"' /&%<K'

0+<-4+0GE' 78%#' (-+#' "-$' B+1"' $81$' +<-"-B%<' <0%#+#' @-&.(' 814+' "-' B1F-0' %BA1<$#' -"'

;+(+01.%#BE'J+' (++B'%$'"+<+##10G'$-' (%#$%"9&%#8'^#$0-"9'<0%#%#_'1"(' ^@+1K'<0%#%#_2'@%$8'

$8+'.1$$+0':+%"9'<8101<$+0%[+(' :G'1'.-"9+0' .1#$%"9'(+$+0%-01$%-"'-;' +<-"-B%<'<-"(%$%-"#'

.+1(%"9'$-'(&01:.+'"+91$%4+' +;;+<$#' -"'+<-"-B%<'1"('#-<%1.'@+.;10+E' 78+' 91B+':+$@++"'

;+(+01.'1<$-0#'(%;;+0#'1<<-0(%"9'$-'$8+'$GA+'-;'<0%#%#S+

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1#' $8+' B1%"' 0+#A-"#%:.+' 19+"<GE' !"' ;+(+01$%-"#2' $8%#' <1A1<%$G' (+A+"(#' $-' (%;;+0+"$'

(+90++#' 1"(' @1G#' -"' $8+' <--A+01$%-"' -;' VWE' 78+' 91B+' $81$' %#' A.1G+(' 8+0+' %#' 1'

^<--0(%"1$%-"'91B+_' @%$8' 1'.-@' (+90++'-;' <-";.%<$E' e+(+01.' <-&"$0%+#' (%;;+0'%"' $8+' @1G'

$8+G'(+1.'@%$8'$8+'<0%#%#'1"('%"'$8+'@1G'$8%#'1;;+<$#';+(+01.'0+.1$%-"#E'k+$'1#'1'0&.+'$8+0+'

10+'T'1#'@+'814+' (+#<0%:+(' T'B%"-0'1(F&#$B+"$#2'#GB:-.%<'#$0+"9$8+"%"9'-;'UQ2' #+10<8'

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$8+#+' <-"(%$%-"#'"-$' -".G' $8+' ;%"1"<%1.' A-$+"$%1.' -;' VW' :&$' 1.#-' -;' $8+' UQ' B1G' :+' %"'

(1"9+0E'!"'$%B+#'-;'#+0%-&#';%"1"<%1.'A0+##&0+'1"('1'#+4+0+'(+$+0%-01$%-"'-;'$8+'+<-"-B%<'

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1$$+BA$#' $-' 0+L(%#$0%:&$+' ;%"1"<%1.' 1&$8-0%$G' %"' ;14-0' -;' $8+' UQ' %"' -0(+0' $-' 91%"' B-0+'

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:+814%-0'-;'VW'%"'-0(+0'$-'14-%('-AA-0$&"%#B'(&0%"9'$8+'<0%#%#E'78+0+'10+'%"(%<1$%-"#';-0'

#&<8'1'(+4+.-AB+"$'%"'$8+';+(+01.'<-&"$0%+#' -;' $8+' *&0-Lp-"+'@8+0+'(+:$'0+9&.1$%-"'-;'

VW' :+<1B+' $8+' B1%"' B+1#&0+' $-' <-A+' @%$8' $8+' %BB%"+"$' +<-"-B%<' %"#$1:%.%$GE' d+L

(%#$0%:&$%-"' 1"(' 0+9&.1$%-"' %9"%$+'%"$+"#+' <-";.%<$#' 1"(' $8+0+;-0+' <1&#+'<-";0-"$1$%-"#'

1:-&$'1&$8-0%$G'%"'$8+';+(+01$%-"E''

78+'<-"#+/&+"<+#'A0-:1:.G'410G':+$@++"'$8+'(%;;+0+"$'$GA+#' -;' ;+(+01.' #$1$+#'@+'814+'

(%#<&##+(E' Z&$' %$' %#' .%K+.G' $81$' 1' #+0%-&#' <0%#%#' @%..' .+1(' $-' #%9"%;%<1"$'<81"9+#' %"' $8+'

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0+.1$%-"#P' $+BA-010G' 0+(&<$%-"' -;' (%#<0+$%-"' B1G' $&0"' %"$-'^1&$8-0%$G' B%901$%-"' :G'

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A0-4+'$-':+'@0-"9'-0'0%98$E'

d*e*d*cU*W'

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athttp://www.camden.rutgers.edu/federalism/papers.html.

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No. 1447, Munich. Online at http://mpra.ub.uni-muenchen.de/1447/.

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Social acceptance of policy instrument design during times of crisis

Article

Full-text available

Apr 2023

Disasters create challenges for governments as they need to design effective and legitimate policy instruments to deal with the crisis. In this paper, we analyze social acceptance of regulations and financial investments in crisis governance, taking the example of the COVID-19 pandemic. By using data from two survey experiments in Switzerland, we show that respondents support rules that temporarily centralize decision-making power to the national level but object to regulations that would make contact tracing efforts mandatory. The data shows also that citizens support financial investments of tax money to prevent future crises. Those who are afraid of the health consequences of the crisis are especially favorable to stricter regulations and financial investment, whereas economic worries related to the crisis specifically and political ideology in general barely explain variance in support for crisis responses. In general, this research contributes to our understanding of how survey experiments can be used to analyze social acceptance of policy instrument design.

Shock or Design: What Drives Fiscal De/Centralization? A Comparative Analysis of Twenty-Nine OECD Countries, 1995–2017

Article

Jan 2021

Over the past decades, decentralization has become the new paradigm in how states should organize power territorially. Carefully planned institutional re-designs are the most visible expression thereof. Yet the Great Recession of 2007–2009 has pushed governments into the opposite direction, i.e., towards centralization, to better weather the fiscal drought. Given these contradictory developments, this article compares the effects of twenty-three separate state reforms with the impact of the Great Recession on fiscal centralization in twenty-nine countries over more than two decades. In the main, our analyses attribute a larger effect to design, i.e., pro-active policy making through reforms, than reactive crisis management after a great shock. However, this difference is only apparent once we consider a state’s institutional structure, that is whether a political system is unitary or federal. Our findings thus highlight the need for a multidimensional approach to better understand the drivers of fiscal de/centralization.

Protection but no Control: Liberal Democracy and the Politicization of Crisis Response Policies

Article

Full-text available

Sep 2020

Researchers agree that the COVID-19 pandemic poses a complex policy challenge for decisionmakers and that governments should quickly augment their response capacity. In liberal democracies, it is important that such increases in state capacities have some degree of popular support, in order to be effective. Therefore, it is important to understand how the public supports different policy options and why some individuals are more favourable to anti-crisis policies than others. In this paper, we analyse the politicization of four dimensions of crisis response capacities against a pandemic based on a two-wave survey experiment in Switzerland. Our findings show that respondents support investment in materials to prevent future crises as well as quotas for health care workers. The results show also support for a leadership role by the federal government instead of lower levels of government, but indicated limited support for mandatory contact tracing efforts. In addition, those who are afraid of the health consequences of the crisis tend to support more state response capacity. Contrariwise, political ideology does not seem to explain support for crisis response. Finally, the support for a federal solution increased during the second wave of a pandemic, whereas approval of contact tracing declined.

Federal dynamics, solidarity, and European Union crisis politics

Article

Full-text available

Jul 2019
J EUR PUBLIC POLICY

Philipp Trein

In this article, I analyse solidarity between regions during times of crisis. To begin with, I define two types of solidarity preferences. Negative solidarity means that territories will regard solidarity only as appropriate in the limits of intergovernmental contracts and consider the fiscal consequences of solidarity to be more important than the social consequences. Positive solidarity implies that regions consider solidarity even if it goes beyond existing intergovernmental contracts as they regard social consequences to be more important than fiscal consequences. I argue that the combination of regional collective identities, the relative importance of intergovernmental over parliamentary decision-making, and the complexity of policy problems impact on preferences for solidarity. To illustrate my argument empirically, I use the European Union (EU) and federal states as examples. More generally, I make a theoretical contribution to understanding the politics of solidarity.

Problem‐Solving Across Literatures: Comparative Federalism and Multi‐Level Governance in Climate Change Action

Article

May 2019

Yasemin İrepoğlu Carreras

This paper aims at making a conceptual and theoretical contribution to understanding problem‐solving capacity in multi‐level contexts. To do so, I use the framework of structure , agency , process, and outcome to systematically discuss how the literatures of comparative federalism and multi‐level governance define and analyze problem‐solving. In discussing these literatures, I also examine how concepts such as integration, functional differentiation, self‐rule, and shared‐rule have important implications for problem‐solving. Policy challenges, such as climate change, require problem‐solving at various territorial levels. To demonstrate the insight from the two literatures and to offer comprehensive theoretical implications for effective problem‐solving capacity, this paper also provides illustrative examples of climate change action and environmental policy in Germany and the EU.

Dynamic Federalism: A New Theory for Cohesion and Regional Autonomy

Book

Full-text available

Jan 2021

Patricia Popelier

The future of federalism – intergovernmental financial relations in an age of austerity [Book Review]

Article

Dec 2017

Martin Sacher

Vertical Relations After the Financial Crisis

Chapter

Dec 2018

This chapter explores the dynamics of vertical power relations before and after the financial crisis of 2007, as perceived by city mayors across Europe. Against the thesis of a convergence of intergovernmental relations in the ‘North’ and ‘South’ of Europe, we show how countries from different state traditions have actually followed different paths of decentralisation and centralisation. Differences between North and South persist with regard to not only power relations, but also mayors’ rescaling strategies for enhancing their scope of action. Mayors in the North try to defend their role in the national political system, whereas mayors in the South and East rely heavily on attracting external resources. The investigation of variation within countries suggests that financially troubled cities in the South were more likely to experience a trend towards recentralisation, whereas cities in economic hardship in Central Eastern Europe show signs of complementing their economic rescaling strategy with a political strategy for resisting centralisation.

Territorial Politics and Institutional Change: A Comparative-Historical Analysis

Article

Dec 2017

In the introductory article for this special issue, we argue that studying territorial politics through comparative-historical analysis (CHA) offers valuable insights in understanding the changing territorial distribution of authority in federal, regional, and decentralized countries.We point to limitations that have beset the analysis of territorial politics and suggest how recent advances in CHA offer a promising approach to avoid and overcome existing shortcomings. We also demonstrate and illustrate the ways that vertical and horizontal dimensions of territorial structures evolve over time, from the moment they are created to subsequent episodes of reform. Our aim is to show that time has causal relevance in connecting past and present patterns of change and continuity, and thus in capturing the formative and developmental pathways of changes in territorial authority.

Federal Dynamics, Solidarity, and European Union Crisis Politics

Preprint

Full-text available

Sep 2018

Philipp Trein

This paper analyzes the crisis politics in the European Union (EU) in comparison to federal states. I assume that – despite obvious differences – the EU faces similar policy challenges as federal states in times of crisis. At the same time, federal states are similar to the EU because intergovernmental conflict and cooperation appear in times of crisis. In taking federations as contrasting cases to the EU, I argue that during times of crisis, in the EU, politics of solidarity are politics of “negative solidarity.” Politics of negative solidarity are all about the limitations of solidarity and member state sovereignty. Member states consider solidarity (e.g. mutual financial support) according to a logic of appropriateness. In contrast, crisis politics in federal states are politics of “positive solidarity”, according to which member states give little emphasis to the limitations of support between constituent units and consider solidarity according to a logic of consequences.

Föderalismusreform in Deutschland, der Schweiz und Österreich

Chapter

Full-text available

Jan 2010

Nathalie Behnke

Alle drei deutschsprachigen Staaten – Deutschland, Österreich und die Schweiz1 – hatten in den vergangenen Jahren verstärkt mit der Ineffektivität ihrer föderalen Strukturen zu kämpfen. Hierbei standen die Ineffizienz und Intransparenz der Finanzausgleichssysteme im Vordergrund, aber auch die Diskussion um einen Rücktransfer weitergehender Kompetenzen an die Länder und Kantone.2 Drittens drehte sich die Diskussion um effektivere Modi der horizontalen und vertikalen Kooperation und Koordination in der Politikgestaltung.

The Dynamics of Fiscal Federalism in India and the Global Financial crises

Conference Paper

Full-text available

Jan 2010

India's fiscal federalism, though asymmetric in nature has so far worked well to keep the federation going. The asymmetry is both vertical as well as horizontal. Former is in terms of the disproportionate allocations of revenue sources and the responsibilities to be discharged to the Central and State governments and the latter, in terms of fiscal capacity of the States themselves. In order to make up for the inadequacy of revenue there is well elaborate mechanism of fiscal transfers from Centre to States. The channels of these transfers are statutory as well as non-statutory. This creates a problem that while States might be getting resources but are deprived of the fiscal instruments to pursue public policies. But the division of fiscal function is well in tune with the principles suggested by Musgrave in late fifties according to which 'economic stabilization' and 'distribution' to be assigned to Centre government while 'allocation' to the States. On and off there have been the conflicts but political economic factors always played a role in their resolutions. Problem gets compounded by the fact that since monetary initiatives are with the Centre it can - in fact it does - use them to counter balance any fiscal profligacy committed on account of political expediency (fiscal measures are politically more sensitive). There is empirical evidence that fiscal transfers could not succeed in bringing about revenue equalization or augmenting the fiscal capacity of States while there have been instances of Centre transgressing into the fiscal space of the States. Responding to the global financial crises and resultant economic slow down Centre came out with stimulus packages by putting a pause on the requirements of Fiscal Responsibility Act. While States were also permitted to defer the same to meet the challenges only a handful of States could come out with any package. Proposed study seeks to analyze the dynamics of federalism during the recent crises.

Republic of South Africa

Chapter

Sep 2007

Federal Republic of Germany

Chapter

Sep 2007

The Territorial Division of Power in Comparative Public Policy Research: An Assessment

Chapter

Jan 2000

Dietmar Braun

Republic of India

Chapter

Sep 2007

M. Govinda Rao

Kingdom of Spain

Chapter

Sep 2007

Commonwealth of Australia

Chapter

Sep 2007

Alan Morris

Decentralization and Subnational Politics in Latin America

Article

Jan 2010

Tulia G. Falleti

Is it always true that decentralization reforms put more power in the hands of governors and mayors? In post-developmental Latin America, the surprising answer to this question is no. In fact, a variety of outcomes are possible, depending largely on who initiates the reforms, how they are initiated, and in what order they are introduced. Tulia G. Falleti draws on extensive fieldwork, in-depth interviews, archival records, and quantitative data to explain the trajectories of decentralization processes and their markedly different outcomes in Argentina, Brazil, Colombia, and Mexico. In her analysis, she develops a sequential theory and method that are successful in explaining this counterintuitive result. Her research contributes to the literature on path dependence and institutional evolution and will be of interest to scholars of decentralization, federalism, subnational politics, intergovernmental relations, and Latin American politics.

The Impact of the Global Financial Crisis on Decentralized Government in South Africa

Article

Jan 2010

This paper examines the impact of the global financial crisis on South Africa, in particular on how the highly centralized federal system absorbed and responded to the crisis. The arguments are that the global crisis and the recession that followed have exacerbated long-standing structural problems in the economy, and that the state’s response to the crisis again highlighted the highly centralised nature of the country’s fiscal constitution. One section of the paper explores the impact of the financial crisis on the economy and the three orders of government. Another section examines how each sphere responded to the crisis. A final section assesses the impact of those responses on the political economy of the country and the workings of the federal system, concluding with a speculation on the long term legacy of the global crisis.

Economic crisis and federal dynamics

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