The focus of this work is the centrality of federal bargaining in the competitive political processes of democratic federations and of the necessity for fashioning institutions to channel and regulate that bargaining so that it is not disruptive of 'normal' policy-making. Chapter 1 introduces the argument and points out the insufficiency of the purely public goods provision approach to understanding federal political processes. The key distinction we make in the way federal bargaining can be institutionalized is between the systems that allow bilateral interactions between the center and the unit representatives, versus those where unit representatives must develop some degree of consensus on a proposal before presenting it to the center.
Chapter 2 tests a hypothesis that a party's current place in the (institutionalized) federal bargaining process affects voters' electoral choice and modifies the incentives that political entrepreneurs and political parties face. In application to Canada, which allows bilateral interactions between unit 'representatives' (provincial Prime-Ministers) and the federal 'center', and Germany, where implementation of federal policies is effectively delegated to the sub-national level, we look for evidence of electoral balancing by comparing electoral returns in federal and sub-national elections. We show that electoral dynamics are, indeed, consistent with the hypothesis that voters balance between federal and provincial (federal and Lander) elections in these two federations.
When representatives of federal subjects are limited to joint action, as when they communicate with the center by means of passing ready pieces of legislation that can be either signed or not by the nationally elected executive, the long-term implications of their representational weights in the bargaining process can be assessed. In chapter 3, using the data on allocation of federal grants in the US, we assess the proposition that outcomes of federal bargaining reflect bargaining weights of the participants. More specifically, we show that relatively small US states, being better represented in the Senate, systematically benefit in the process of federal grant distribution.
The fourth chapter addresses the political process in a federation Russia with a still evolving bargaining system and, where the issue of federal bargaining is the focus of national political discourse. We are able to support the hypothesis that federal level policies affect local electoral behavior, as well as do the outcomes of bilateral discourse between federal subjects and the 'center'.
