The United States provides a classic example of a bottom-up system of federalism. It was created in 1787 when representatives of the then 13 colonies convened to ratify a constitution under which both the central government and the states would be sovereign entities. Within certain...

Transfers and bailouts: enforcing local fiscal discipline with lessons from U.S. federalism / Robert P. Inman -- Constraining subnational fiscal behavior in Canada: different approaches, similar results? / Richard M. Bird and Almos Tassonyi -- Vertical imbalance and fiscal behavior in a welfare...

In recent years, reallocation has become increasingly important as a means to finance new needs in the spheres of internal and external security, integration of immigrants, education, health and pensions, especially in countries where economic growth has been weak. At a time when public...