Polycentric Polity: Genuine vs. Spurious Federalism

Review of Law and Economics, Forthcoming

GMU Working Paper in Economics No. 10-15

23 Pages Posted: 13 Apr 2010

See all articles by Giuseppe Eusepi

Giuseppe Eusepi

Sapienza University of Rome

Richard E. Wagner

George Mason University - Department of Economics; George Mason University - Mercatus Center

Date Written: April 13, 2010

Abstract

Federalism is commonly described in contradictory fashion as involving both competition and decentralization. These descriptions may appear similar on the surface but they emanate from contradictory analytical orientations. Competition entails a polycentric arrangement of competitors where there is no locus of control over the arrangement. In contrast, decentralization is a monocentric arrangement that involves a locus of control. To treat federalism as a method for decentralizing governments leads to a spurious form of federalism because the object that has been identified is not genuinely a competitively organized system of government. Genuine federalism requires a polycentric arrangement that is organized through openly competitive processes. In contrast, the spurious form of federalism allows hierarchy to trump open competition.

Keywords: competitive government, federalism, polycentricity, decentralization

JEL Classification: D2, D6, D7, I38

Suggested Citation

Eusepi, Giuseppe and Wagner, Richard E., Polycentric Polity: Genuine vs. Spurious Federalism (April 13, 2010). Review of Law and Economics, Forthcoming, GMU Working Paper in Economics No. 10-15, Available at SSRN: https://ssrn.com/abstract=1589182

Giuseppe Eusepi

Sapienza University of Rome ( email )

Via del Castro Laurenziano, 9
Rome, RM 00161
Italy
+39 06 49766955 (Phone)

Richard E. Wagner (Contact Author)

George Mason University - Department of Economics ( email )

4400 University Drive
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Fairfax, VA 22030
United States
(703) 993-1132 (Phone)

HOME PAGE: http://mason.gmu.edu/~rwagner/

George Mason University - Mercatus Center ( email )

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Arlington, VA 22201
United States

HOME PAGE: http://ppe.mercatus.org/scholars/richard-wagner

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