ABSTRACT
This chapter proposes that federalism and decentralization, intended initially for democratic systems, can contribute to achieving these goals in non-democratic settings. The institutions of federalism and decentralization also enhance the ability of non-democratic rulers to persuade both elites and the population that the current political system is the best choice for the country among all other viable alternatives. Federalism and decentralization are institutional mechanisms that facilitate the resolution of the conundrum of limiting the size of the inner circle while expanding the coalition that supports personalistic regimes. Federalism and decentralization create a multi-level power structure that shields the ruling clique from public scrutiny and potential uprisings. Many scholars and practitioners expected that federalism and fiscal decentralization would promote markets, power-sharing, and efficiency of public good provisions. In Russia and Kazakhstan, elements of federalism and decentralization help to maintain the stability of their entire non-democratic institutional systems.
