In 1994 China began a profound reform of its state-owned enterprises. We first describe and characterize this progress in two areas: privatization of small state-owned enterprises at the county level and mass layoffs of excess state workers at the city level. Local governments have initiated...

The authors advance a new perspective in the study of federalism. Their approach views federalism as a governance solution of the state to credibly preserving market incentives. Market incentives are preserved if the state is credibly prevented from compromising on future economic success and...

This paper studies the problem of self-enforcing constitutions, addressing the question, how do some constitutions provide incentives for political officials to abide by the constraints announced in the constitution? To understand the mechanisms underlying successful constitutions, the paper...

All federal systems face the two fundamental dilemmas of federalism: too strong a center risks overawing the subnational units; and too weak a center risks free-riding that makes the system fall apart. Resolving the two dilemmas is problematic because mitigating one dilemma exacerbates the...

First generation fiscal federalism (FGFF) studies the performance of decentralized systems under the assumption of benevolent social planners. Second generation fiscal federalism (SGFF) studies performance based on the fiscal and political incentives facing subnational officials. The paper...