The classic theory of fiscal federalism suggests that different people should have different governments. Yet, separate local governments with homogeneous constituents often end up doing poorly. This paper explains why and answers three questions: when regions are heterogeneous, what determines...

The organisation of inpatient care provision has undergone significant reform in many southern European countries. Overall across Europe, public management is moving towards the introduction of more flexibility and autonomy . In this setting, the promotion of the further decentralisation of...

This article presents a formal model of policy decision-making in an institutional framework of separation of powers in which the main actors are pivotal political parties with voting discipline. The basic model previously developed from pivotal politics theory for the analysis of the United...

Recent policy developments in public health care systems lead to a greater diversity in health care. Decentralisation, either geographically or at an institutional level, is the key force, because it encourages innovation and local initiatives in health care provision. The devolution of...

The defaults of Philip II have attained mythical status as the origin of sovereign debt crises. We reassess the fiscal position of Habsburg Castile, deriving comprehensive estimates of revenue, debt, and expenditure from new archival data. The king’s debts were sustainable. Primary surpluses...

This paper proposes an argument that explains incumbency advantage without recurring to the collective irresponsibility of legislatures. For that purpose, we exploit the informational value of incumbency: incumbency confers voters information about governing politicians not available from...

This paper presents a tractable dynamic general equilibrium model that can explain cross-country empirical regularities in geographical mobility, unemployment and labor market institutions. Rational agents vote over unemployment insurance (UI), taking the dynamic distortionary effects of...

This paper analyzes the current trend towards firms’ self-regulation as opposed to the formal regulation of a negative externality. Firms respond to increasing activism in the market(conscious consumers that take into account the external effects of their purchase) by providing more socially...

We construct a model in which the ambiguity of candidates allows them to increase the number of voters to whom they appeal when voters have intense preferences for one of the alternatives available. An ambiguous candidate may offer voters with different preferences the hope that their most...

Many have observed that political candidates running for election are often purposefully expressing themselves in vague and ambiguous terms. In this paper we provide a simple formal model of this phenomenon. We model the electoral competition between two candidates as a two--stage game. In the...