New Directions in Federalism Studies
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The second reason relates to developments within the discipline of political science. Following the decline of behaviorialism and structural-functionalism, political science re discovered institutions Weaver and Rockman ; Steinmo et al. Scholarly attention to institutional arrangements that shape political strategies and distribute political power brought a renewed interest in how political authority is divided, shared or dispersed among two or more orders of government. Hooghe, Marks and Schakel observe that the growth of regional authority is not pronounced among those states that were already federal in for instance Australia, the US, Switzerland or Germany and among those states that are too small i.
However, their calculations show that regional authority has grown substantially in non-federal countries with populations above three million. The authors raise a number of explanations to account for this growth. For instance, the absence of warfare obviates the need for a strong centralized effort to reconstruct national economies after war. Furthermore, the functional logic of economic, infrastructural, environmental and welfare policies has pressed many formerly unitary states in the decentralizing direction.
In recent years in Latin America alone, local or provincial elections were introduced in non-federal Bolivia, Chile, Colombia, Paraguay and Venezuela and strengthened in federal Argentina and Brazil Treisman 3. Both in its federal and decentralized forms, there has been an increase in the supply of vertically divided political authority. Although federalism and political The new wave offederalism studies 3 decentralization are separate concepts, they both lead to the strengthening of regional and local orders of government. Decentralization in essence is an act of the centre to devolve some of its political competences to lower levels; regions, thus, do not have a constitutional guarantee to self-government.
Under federalism, on the other hand, the regions' right to self-rule tends to be constitutionally enshrined. Both forms of vertical division, however, have become more salient partly due to international factors. For industrialized states, the global integration of international markets and the dominance of monetarist economic ideology weakened the political and economic responsibilities of central governments, thereby providing favorable conditions for decentralization.
However, the current global financial crisis might slow this process as central governments around the world are forced to reclaim some of their former role in managing the economy. That being said, at this stage the financial crisis triggering a complete reversal of the economic empowerment of regions seems unlikely. For many developing states on the other hand, the rise of decentralized government owes its existence to leading international monetary institutions such as the World Bank, the International Monetary Fund, the Inter-American Development Bank and the United Nations Development Program, who have all advocated various forms of vertically divided political and economic decision-making.
These international fiscal institutions do more than just advocating decentralization; they formulate the implementation of such policies as a prerequisite for receiving monetary support. Daniel Treisman notes that between and , the World Bank pledged million US dollars per year to support projects with a significant decentralization component.
In his view, "for a developing country short of money, devolving power must look like an easy way to cash in on the rich world's desire to help" Treisman 4. The virtues of federalism and decentralization are not only propagated from the viewpoint of econom ic performance but also from the perspective of managing ethnic conflict. The process of democratization in Central and Eastern Europe following the end of the Cold War compelledJeformers to think through appropriate institutional schemes for stabilizing and consolidating these new democracies. Institutional engineers often turned to federalism.
But in some parts of the former communist world the pacifying potential of federalism was not warmly received. For instance, in some East European countries federalism was automatically associated with "ethno-federalism" - which carried negative connotations of divisive nationalist movements pitting one ethnic group against the other.
The breakdown of multi-ethnic if non-democratic federations such as Czechoslovakia, Yugoslavia and the Soviet Union prevented the widespread adoption of federalism in this part of the world - notwithstanding federal Russia and Bosnia-Hercegovina Heinemann-Grtider 4; Seroka But such a pessimistic attitude towards the conflict-management potential of federalism is not shared in the west of the continent and elsewhere. In Western Europe, Spain, Belgium and the United Kingdom have sought to contain nationalist pressures by decentralizing powers to regional governments Swenden Federalism was adopted in Iraq as a means to ensure the coexistence of 4 J.
Swenden Kurds, Shiite and Sunni Muslims; and it is also seen as a necessary institutional ingredient for holding together large or multi-nation states such as Indonesia, Ethiopia, Nigeria or the Congo Anderson An example of the growing international salience of federalism is the "Forum of Federations" - an international organization supported by many countries and governments in a quest to promote the conflict-management potential of federalism. Another important example of the growth in the supply side of federalism is the European Union, of course. The very foundation of European integration is based on the principle of divided political authority between the member states and the union.
Most observers tend to see the European Union as an international system of multi-level governance with federal traits Hesse and Wright ; McKay ; Borzel and Hosli These traits have been helpful in reconciling the overarching goal of economic and political integration with the preservation of national state boundaries for a recent literature review on the topic, see Kelemen and Nicolardis In the last decades, some of the older federations such as Australia, Canada, Germany and Switzerland have undertaken various federal reform initiatives. These reforms generally aim to bring about better coordination and cooperation among orders of government as a means to enhance performance in an increasingly globalized world economy.
For instance, Germany took some cautious steps to reform its federal structure in in light of growing criticisms that party political games and growing inter-regional disparities do not square well with a model of federalism that expects close cooperation among federal and regional orders of government Scharpf , Benz Less uniformity, less framework legislation, fewer joint policy tasks and more regional legislative autonomy are seen as possible ways to break away from the "reform gridlock" Reformstau. A more daring reform plan discusses the possibility of returning some tax powers to the German provinces, i.
The issue of finance has also featured prominently in a recent reform of Swiss federalism Vatter and in the Australian decision to replace a number of regional sales taxes with a federal Goods and Services Tax, the revenue of which mostly accrues to the constituent states of the Australian Commonwealth Swenden Although changes to Canadian federalism have been less prominent, federalism remains highly vulnerable on a number of points.
How to integrate Quebec in the federation and whether or to what degree accept its opt-out from federal welfare programs remains unresolved, as well as how to limit the uses or abuse of the federal spending power, and how to reform the second chamber and strengthen its potential role as a tool of regional representation Smith Finally, federalism receives more attention because some of the emerging markets, especially India and Brazil, happen to represent federal states.
The growing significance of these states from an economic point of view also propels more research interest into their political systems, including the nature of their federal systems see for instance Rao and Singh on India; Samuels on Brazil. In parallel, some argue that a country as vast and unevenly developed as The new wave offederalism studies 5 China could only liberalize politically if it were to become a federation Bahl and Martinez-Vasquez Others have already argued that political decentralization has been the key to the economic success of China Qian and Weingast ; but see Cai and Treisman for a critical assessment and an alternative explanation.
Political sciellce rediscovers federalism lIIul political illstitutiolls As the contemporary political relevance of federalism increases, it is only natural that a new generation of political scientists is drawn to studying the contours of this complex phenomenon. In many ways, this reflects the fate of democratization studies. Each subsequent wave of democratization Southern Europe, Latin America, Central and Eastern Europe produced a new wave of democratization studies.
Similarly, the rise of decentralization or the prospect of federalism in Europe and beyond propelled a rise in decentralization or federalism studies. But the growing scholarly attention is not only a factor of the growth in the supply side of federal and decentralized government.
The study of federalism also benefits from a broader tendency among political scientists since the mids to revisit the relevance of political institutions North ; Koelble Starting with the mids, institutionalism slowly moved to the centre of political science - hitherto dominated by society-based approaches such as behavioralism and structural-functionalism and actor-based rationalist approaches Evans et al. In an influential piece from that period, lames March and lohan Olsen highlight the limits of society-based and rationalist explanations of institutional phenomena that dominated the literature March and Olsen In their view, political scientists using rational choice theory should pay more attention to collective action problems rather than individual wellbeing and acknowledge that many political decisions are taken under a "veil of ignorance" i.
Similarly, March and Olsen argue th-at structural or societybased explanations of political action pay insufficient attention to the reciprocal effect of institutions on societies: politics or political institutions can shape society as much as society can shape politics see Peters for a discussion. Studying the causes and the consequences of an institutional configuration in this case vertically divided political authority between orders of government in many ways was an ideal terrain for this new approach in political science.
As institutionalism became part of the mainstream, the study of federalism broke from being under the near-monopoly of legal scholars. But the rediscovery of political institutions came with an outlook slightly different from the older institutionalism. There have been calls for a distinctly neo-institutionalist approach Rhodes New institutionalists distinguish themselves from the "old" institutionalists, who were more concerned with describing than explaining political institutions.
Old institutionalists tended to follow legal scholars in their choice of 6 J. Erk and W. Swenden political institutions to study, and in how to study them. Furthermore, old institutionalists also tended to define institutions in a manner parallel to legal scholars heavily focusing on the trias politica, i.
By contrast, new institutionalists provide a much broader definition of institutions Peters ] ] 8-] 9 , and they criticize but do not outright reject the methods deployed by behavioralists, structuralists and rational choice theorists. For instance, new institutionalists tend to nuance rather than reject the premises of rational choice theory and even seek to incorporate its analytical rigor. Rational choice institutionalists such as George Tsebelis and Frits Scharpf bring in institutional rules and consider how they affect or condition the strategic behavior of actors in the political process.
Similarly, new institutionalists increasingly deploy the sophisticated data-skills behavorialists tend to use. This is particularly the case in the analysis of how institutions interact with the external context to steer processes of interest aggregation or affect policy outcomes Lijphart ; Castles These developments within political science also affected the way in which political scientists studied federalism. We would argue that what we are witnessing since the s is indeed a new approach to studying federalism.
However it is also new because - unlike what Alfred Stepan could still claim as recently as - by now the leading approaches within comparative politics are reflected in how federalism is studied Stepan Comparative politics and federalism have found each other in the new wave. The research puzzles and approaches of the new wave Notwithstanding the recent upsurge in comparative federalism research, the study of federalism has an intellectual lineage predating In fact, an important corpus of classics within the literature appeared during the time-period between the end of World War II and the s Livingston] ; Duchachek ; Sawer ] ; King ; Watts ; Wheare ; Riker ; Friedrich This cycle producing some of these landmark studies on federalism finished with Daniel Elazar's influential Exploring Federalism, first published in ] During this time-period, the study of federalism occasionally emerged on the radar of general comparative political scientists as well.
For instance, in his first edition of Democracies , Arend Lijphart considered the distinction between unitary and federal government as one crucial dimension of his broader typology setting out consensus vs. Arguably of all the authors listed above, the political scientist who cast the longest shadow on contemporary federalism research remains William H. Riker Yet, Rikers' contribution to federalism has also The new wave o.
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Indeed, in a critical review of Riker's work on federalism, Alfred Stepan stated that "the world's most prestigious academic authority on federalism [also considers the object of] his scientific observation [as a] a powerless chimera" Stepan Riker is not a rational choice institutionalist but a rational choice theorist pur sang. For him, individual preferences remain the key driving force behind social choice. Therefore, "federalism is not more than a [fiction].
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No matter how useful the fiction of federalism is in creating a new government In the study of federal governments", so he once argued, "it is always appropriate to go behind the fiction to study the real forces in the political system" Riker Riker's provocative verdict was that federalism simply did not matter. Perhaps the most important scholarly task of the new wave of federalism studies has been to prove Riker wrong. By doing so, students of federalism have not only sought to demonstrate that federalism matters, but also how it matters, to what extent it matters and what it matters for.
Although students of federalism bring different approaches to the forefront when addressing these questions they also share two basic characteristics. First, showing how federalism matters necessitates a comparative approach in which different forms of federalism are compared with each other and with nonfederal regimes. This increasingly comparative outlook has brought with it a concern for external validity to an area of study that used to be driven by internal validity.
In addition to becoming experts of the minutiae of one federation, the new wave of federalism studies now seeks lessons that could be generalized to other cases where political authority is divided among orders of government.
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In this respect the study of federalism benefited from the rising prominence of comparative politics, the wider availability of international datasets provided by international organizations such as the OECD or academe such as "The Minorities at Risk Project" at the University of Maryland and the diffusion of dataskills among comparativists.
The emphasis on external validity and the rising quality of comparative federalism research also reflects the mainstreaming of federalism into comparative politics. Conversely, comparative federalists have increasingly branched out to other fields of study. Contemporary scholarship displays an awareness of ongoing theoretical debates in other parts of the scholarly community, and a desire to enrich federalism studies by importing and exporting ideas across fields of study.
It is this belief in finding generalizable patterns that drives contemporary scholarship. Second, federalism studies shed much of its normative undel10nes during its recent boom. There now seems to be an analytic distance to the very subject under study. That is, we see more of an even-handed discussion of both the positive and negative sides of federalism.
The new wave of federalism studies tends to be less driven by an underlying normative attachment to the subject often held by the previous generation of federalism research Elazar , In fact many of these earlier studies were often built on a federal illusion, i. According to Pablo Beramendi: "The need to bridge this 8 J.go here
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Swenden gap between theories and facts, between the federal illusion and a disappointing reality, has been the engine behind the scholarship on federalism over the last two decades" Beramendi The "better democracy" assumption derives from an understanding that federalism brings politics closer to the people, increases avenues of political representation and thus also elections and proliferates the number of contact points through which interest groups can make themselves heard.
The "better bureaucracy and market preserving" assumptions derive from the understanding that federalism promotes factor mobility, which in tum encourages governments to be efficient, effective and innovative. Yet not only public choice economists, but also welfare economists have sung the praises of federalism Musgrave ; Oates , Their view is that federalism enables tasks to be appropriated to the most efficient level of government. On these grounds, redistribution, stabilization of monetary and fiscal policy or policies that generate significant externalities environmental regulation for instance should be assigned to the federal level, whereas policies that require more detailed market signals such as education or health care should be assigned to lower political levels.
One of the most important contributions of the new wave of federalism studies is to confront these assumptions with hard empirical evidence. At least one outcome of this approach has been a healthy detachment from the subject. By undertaking an even-handed and critical evaluation, scientific analysis can be separated more easily from a normative attachment to federalism.
Accurate diagnoses should precede prescriptive license. In this context, explaining and understanding federalism should precede the blanket endorsement of its assumed benefits. It is this quest to unearth the working of federalism that would eventually result in more realistic expectations from political engineering.
A set of questions that contemporary students of federalism tend to explore, for instance, promises a much richer and nuanced comprehension of the dynamics at play between federalism and democracy before the concept is endorsed and prescribed: I Do federal democracies effectively generate higher political participation? The quest for an even-handed and critical evaluation of federalism has led to questions tackling the assumed macro- economic benefits of federalism as well.