Geoscience Reference
In-Depth Information
contention over fiscal structures in two unions with fundamentally different
starting points contributes to a better understanding of the origins and evolu-
tion of fiscal structures, even if the cases under consideration do not meet all
the requirements for the causal identification of marginal effects. Endogenous
distributive tensions operate under very different institutional conditions in
the EU and Spain. The argument predicts that in the EU the initial design of
representation will exacerbate the decentralizing effect of economic geography
on fiscal structures. In Spain, the argument predicts that the initial centripetal
arrangements will constrain such effects and lag the process of decentralization
of redistribution. Establishing whether these expectations hold is an important
part of the empirical agenda in this topic that complements the tighter grasp
on causal mechanisms facilitated by natural experiments.
Natural Experiments
At different times in history, the Great Depression and Germany's Reunification
created a set of circumstances that make capturing the causal link between
economic geography and political representation and the role of mobility in
shaping interpersonal redistribution a feasible endeavor. The contrast between
the way the United States and Germany responded to radical transformations
in their economic geography facilitates the evaluation of the mediating role of
the systems of representation that in both cases can be considered as given. In
turn, the contrast between the responses in Canada and the United States to
the changing geography of income and labor market risk controls for a set of
relatively similar political and institutional circumstances, thereby facilitating
the assessment of the influence of mobility in shaping public insurance systems.
In what follows, I discuss in detail the nature of representation in these three
political unions before they were subject to a sudden transformation of their
economic geography.
As opposed to the EU, the process of federalization in the United States
and Canada was already completed during the early decades of the twentieth
century. The federal government of the United States enjoyed a much more
prominent political position. It controlled the political agenda, the army, trade
policy, regulation of the economy, foreign policy, the bulk of the law and order
system, and many other policy domains. In both cases, the federal government
is the leading political institution in the federation: it sets the political agenda
and controls the largest share of government resources. Accordingly, there was
a system to ensure direct accountability from the federal government to the
citizenry. This is particularly the case in the U.S.'s presidential system, but
also in Canada, where the prime minister is determined by the majority in
the House of Commons. Both unions used a majoritarian system to translate
votes into either delegates to the electoral college (United States) or seats to the
House (Canada). As a result, the system of representation is relatively closer
to the centripetal end of the scale. Politics was much more federal in North
Americainthe1930s than it is in the European Union today. However, several
