The Political Agenda Effect and State Centralization

Daron Acemoglu, James Robinson and Ragnar Torvik

No 22250, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We provide a potential explanation for the absence of, and unwillingness to create, centralized power in the hands of a national state based on the political agenda effect. State centralization induces citizens of different backgrounds, interests, regions or ethnicities to coordinate their demands in the direction of more general-interest public goods, and away from parochial transfers. This political agenda effect raises the effectiveness of citizen demands and induces them to increase their investments in conflict capacity. In the absence of state centralization, citizens do not necessarily band together because of another force, the escalation effect, which refers to the fact that elites from different regions will join forces in response to the citizens doing so. Such escalation might hurt the citizen groups that have already solved their collective action problem (though it will benefit others). Anticipating the interplay of the political agenda and escalation effects, under some parameter configurations, political elites strategically opt for a non-centralized state. We show how the model generates non-monotonic comparative statics in response to the increase in the value or effectiveness of public goods (so that centralized states and public good provision are absent precisely when they are more beneficial for society). We also suggest how the formation of a social democratic party may sometimes induce state centralization (by removing the commitment value of a non-centralized state), and how elites may sometimes prefer partial state centralization.

JEL-codes: D70 H11 P48 (search for similar items in EconPapers)
Date: 2016-05
New Economics Papers: this item is included in nep-cdm, nep-mic and nep-pol
Note: POL
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Published as Daron Acemoglu & James A. Robinson & Ragnar Torvik, 2020. "The political agenda effect and state centralization," Journal of Comparative Economics, .

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