Representation and regional redistribution in federations

Tiberiu Dragu () and Jonathan Rodden ()
Additional contact information
Tiberiu Dragu: University of Illinois
Jonathan Rodden: Stanford University

No 2010/16, Working Papers from Institut d'Economia de Barcelona (IEB)

Abstract: This paper examines the role of institutions of territorial representation in shaping long-term patterns of inter-regional redistribution within federations. A simple legislative bargaining model with endogenous taxation suggests that over-represented states should be favored in the distribution of inter-governmental grants regardless of their income level. We demonstrate that a striking relationship between legislative representation and grants holds up in a diverse group of federations from around the world. The relationship appears not to be an artifact of economic development, population size, population density, or the historical conditions under which the federal bargain was struck. Furthermore, we suggest that the attractiveness of poor states as coalition partners implies that intergovernmental transfer systems will often tend toward progressivity under equal apportionment, but the systematic over-representation of wealthy (or poor) states can undermine (or bolster) this logic.

Keywords: Redistribution; federalism; intergovernmental transfers; malapportionment (search for similar items in EconPapers)
JEL-codes: D72 D78 H77 (search for similar items in EconPapers)
Pages: 43 pages
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://ieb.ub.edu/wp-content/uploads/2018/04/2010-IEB-WorkingPaper-16.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ieb:wpaper:doc2010-16

Access Statistics for this paper

More papers in Working Papers from Institut d'Economia de Barcelona (IEB) Contact information at EDIRC.
Bibliographic data for series maintained by ().