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Edited by Henrik Enderlein, Sonja Wälti and Michael Zürn
Chapter 2: Federalism and Optimal Allocation Across Levels of Governance
2 Federalism and optimal allocation across levels of governance Benny Geys and Kai A. Konrad 2.1 INTRODUCTION Countries differ in their governmental architectures and in the rules that describe the allocation of tasks, rights and duties across the various levels of government. Figure 2.1 displays the architecture of two (hypothetical) countries by way of illustration. Country A on the left-hand side has two levels of government: a central government at the highest level and many small jurisdictions at the lower level. Country B on the right-hand side has three layers of government: a central government at the highest level, two ‘regional’ governments representing an ‘intermediate’ level of government and several small jurisdictions at the third and lowest level. Clearly, these are only two possible constellations. Treisman (2000) analyses a large set of countries and finds government architectures involving between one (Singapore) and six layers of government (Russia). Many of these real-world government architectures are (significantly) more complicated than the ones depicted in Figure 2.1. Moreover, countries’ government architectures are not static, but subject to often substantial change. Such reforms are habitually the focus of intense political debates. Föderalismusreform I (in 2006) and II (in 2009) in Germany and the debates about a further reorganization (or, more specifically, regionalization) of the government architecture in Belgium since the federal elections of June 2007 are illustrative. Similar debates exist also in many developing countries, and are high on the agenda of international organizations such as the World Bank or the International Monetary...
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