EconPapers    
Economics at your fingertips  
 

Provincial Protectionism

Konstantin Sonin ()

No 3973, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: In a federal state, political leaders of constituent units might protect their enterprises from the federal center (e.g., allowing them not to pay federal taxes). The effectiveness of such protection depends crucially on the ability of local authorities to extract rents from enterprises. They can easily do so, if there are a small number of enterprises with large employment, and local monopolies can be effectively sustained. They cannot do it so easily if regional industry is competitive, political opposition is strong, and the federal center has enough means to enforce payment of taxes. We build a simple model to argue that it is the industrial structure of constituent units that determines political relations between them and the federal centre. The theory is supported by the recent experience of Russia, China, and Argentina.

Keywords: china; federalism; political economics; russia (search for similar items in EconPapers)
JEL-codes: H77 P20 P30 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-geo, nep-pbe and nep-pol
Date: 2003-07
References: Add references at CitEc
Citations: View citations in EconPapers (24) Track citations by RSS feed

Downloads: (external link)
http://www.cepr.org/active/publications/discussion_papers/dp.php?dpno=3973 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

Related works:
Journal Article: Provincial protectionism (2010) Downloads
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:cpr:ceprdp:3973

Ordering information: This working paper can be ordered from
http://www.cepr.org/ ... ers/dp.php?dpno=3973

Access Statistics for this paper

More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().

 
Page updated 2019-07-22
Handle: RePEc:cpr:ceprdp:3973