A Tale of Two Federalisms: Long-Term Institutional Change in the United States and in Germany

Abstract:     
This paper offers a comparison of government centralization in the United States and in Germany. After briefly laying out the history of federalism in both countries, we identify the instruments of centralization at work. It is argued that an initial constitutional framework of competitive federalism does not prevent the long-term centralization of competencies. Against a background of historical evidence, we discuss the political economics of government centralization. It is argued that formal institutions clearly have an effect on the pathways of government centralization, but not necessarily on the broader trend of centralization. The conclusion is reached that preservation of state and local autonomy may eventually hinge on informal political institutions.

Keywords: Federalism, Government Centralization, State and Local Autonomy, Bryce Law, Popitz Law, Institutional Evolution

JEL Classification: H77, K19, Z10, P42, N42, N44

Accepted Paper Series