Relevant Political Actors Research Articles

Switzerland—a paradigm for Europe?

Learning from the Swiss experience, this article argues that federalism and direct democracy are effective mechanisms for dealing with the diversity of interests, languages, cultures and religions in Europe. These institutions only partly harmonize economic, social and cultural politics. By far more important is that federalism and referenda foster competition between the various interests, but do so within a well-defined basic constitutional design so that competition produces beneficial effects. Federalism is not an alternative to referenda but rather a prerequisite for the effective working of a direct democracy. In small communities, the information cost of voters deciding on issues or judging representatives' performance are much lower than in a large jurisdiction. The more fiscal equivalence is guaranteed, the better the benefits of publicly supplied goods can be acknowledged and the corresponding costs be attributed to the relevant political programmes or actors. Thus, while federalism provides for cheaper information, referenda enable citizens to use this knowledge effectively in the political process. The interdependence of federalism and referenda also works the other way around: referenda improve the working of federalism. Besides the possibility of voting with their feet, citizens may also vote directly. This represents a double incentive for politicians to take their citizens' preferences into account; otherwise, they may lose their tax base to another jurisdiction or may be forced by referenda and initiatives to meet the demands of the voters.

Political influence and the ratification of the income tax amendment

The adoption of the Sixteenth Amendment to the U.S. Constitution was perhaps the single most important event in the history of government growth in the 20th century. By vastly increasing the effective tax base available to the federal government, the Sixteenth Amendment removed the single constraint that might have prevented the enormous expansion of federal spending since 19 13. Historians have often portrayed the emergence of a federal income tax as part of the Populist/Progressive campaign to “soak the rich” as an end in itself. In a series of recent papers, Baack and Ray have proposed an alternative theory. They argue that support for the Sixteenth Amendment was a function of the extent to which organized interest groups in a state expected to benefit from the growth of federal spending that an income tax would allow. Hitherto neglected, however, has been the question of the incentives confronting political decisionmakers in their income tax votes, whether in the Congress or in state legislatures. What did individual politicians have to gain, or to lose, from the enactment of a federal income tax? Did nonideological factors play any significant role in the decision by individual politicians to support or oprose the income tax? The present paper is designed to explore the extent to which the degree of political influence available to the relevant political actors affected their decisions in relation to the federal income tax. The paper is divided into five sections. First the history of the federal income tax in the United States prior to the ratification of the Sixteenth Amendment in 1913 is reviewed. Then previous explanations given by historians for the emergence of a federal income tax are considered, including some recent alternatives presented by economists, and an alternative explanation based on the relative political influence of key decisionmakers is offered. Our empirical model of the income tax creation process is then presented, as well as an explanation of our

Organizational Design and Political Control of Administrative Agencies

In this article, I argue that the structure and design of administrative agencies can be explained as mechanisms for controlling the principal-agent problem that exists between the political actors who delegate regulatory authority to administrative agencies and the bureaucrats within those agencies. The insight of this article is that politicians who establish administrative agencies can manipulate the structure and design of those agencies in ways that reduce the chance that future changes in the political landscape will upset the terms of the original understanding among the relevant political actors. The thesis can be illustrated easily with reference to the most fundamental choice of agency design: whether to create a single-industry regulatory agency or a multi-industry regulatory agency. At one extreme is the situation where a single agency regulates a number of separate industries with conflicting interests. At the other extreme is the situation where a single agency regulates a single industry or even, as in banking, a particular subgroup within an industry. My argument is that the nature of the outcomes generated by these two regulatory agencies will be quite different as a result of important differences The author is particularly grateful for comments and guidance from Cynthia R. Farina, Pablo T. Spiller, Cass Sunstein, and Barry Weingast. He also received useful suggestions and criticism

Argentina 1983: Elections and Items for Negotiations with the United Kingdom

Argentine politics have become topical with a vengeance. Two areas deserve urgent attention now. Firstly, the result of the election of 30 October, along with a preliminary analysis of its meaning. Secondly, the negotiating position of the Argentine democratic political spectrum, if it is not to be caricatured, is in urgent need of being known in all its complexity. The first section of this article will contain remarks on the election and the second section will outline findings resulting from interviewing the relevant political actors listed in the appendix.