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4 years ago

Competitive federalism sparks liberty, while cartel federalism stifles freedom.

Journal of Public Finance and Public Choice
Polycentrism, Federalism, and Liberty: A Comparative Systems Perspective
Richard E. Wagner, Akira Yokoyama

Paper Summary

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Federalism can either promote or hinder liberty, depending on the type of governance system in place. Competitive federalism, where governments compete with each other, is better for liberty than cartel federalism, where governments collude. In competitive federalism, no single government dominates, while in cartel federalism, one government controls the others.