EXPERIMENTATION IN FEDERAL SYSTEMS

• 成果类型: Article
• 署名作者: Callander, Steven; Harstad, Bard
• 署名单位: Stanford University; University of Oslo
• 刊物名称: QUARTERLY JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0033-5533
• DOI: 10.1093/qje/qjv008
• 发表日期: 2015
• 页码: 951-1002
• 关键词: ALLOWANCE-TRADING SYSTEM; POLICY; decentralization; diffusion; POLITICS; Abortion; STATES; EVOLUTION; MARKETS; LESSONS

摘要

We develop a model of policy experimentation in federal systems in which heterogeneous districts choose both whether to experiment and the policies to experiment with. The prospect of informational spillovers implies that in the first best the districts converge in their policy choice. Strikingly, when authority is decentralized, the equilibrium predicts the opposite. The districts use their policy choice to discourage other districts from free-riding on them, thereby inefficiently minimizing informational spillovers. To address this failure, we introduce a dynamic form of federalism in which the central government harmonizes policy choices only after the districts have experimented. This progressive concentration of power induces a policy tournament that can increase the incentive to experiment and encourage policy convergence. We compare outcomes under the different systems and derive the optimal levels of district heterogeneity.