ABSTRACT

Tensions between central authorities and subnational units over how much centralization is desirable and how much subnational fiscal autonomy the different states may enjoy are on top of the political agenda in some developing federal countries (such as Argentina, Brazil, India, Nigeria, and Russia) as well as in some developed democracies (ranging from Belgium, Italy, and Spain to Canada, the United States, and the United Kingdom). The degrees of centralization and subnational autonomy have changed dramatically in some cases, oscillating between federal disintegration and secession when the center is extremely weak (Yugoslavia and more recently the conflict over Crimea in Ukraine may be examples of this) to a very powerful central government capable of destroying federalism by overwhelming lower-level governments (such as in Putin’s Russia and to a lesser extent in Venezuela under Chávez). When are these extreme situations more likely to occur?