We establish a link between the best system of government and the strength of inter-state spillovers within a model of political competition with self-interested parties. We show the superiority of the unitary system when: inter-state spillovers are strong; the ego rents of local parties are high; and the system of government is chosen under a veil of ignorance.
Institutional design, political competition and spillovers / M. Alderighi, C. Feder. - In: REGIONAL SCIENCE AND URBAN ECONOMICS. - ISSN 0166-0462. - 81:(2020), pp. 103505.1-103505.13. [10.1016/j.regsciurbeco.2019.103505]
Institutional design, political competition and spillovers
M. Alderighi
Primo
;
2020
Abstract
We establish a link between the best system of government and the strength of inter-state spillovers within a model of political competition with self-interested parties. We show the superiority of the unitary system when: inter-state spillovers are strong; the ego rents of local parties are high; and the system of government is chosen under a veil of ignorance.
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