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Show 8 federal arrangement of sector: the public function. Under each person 831), a economic roles for the government. Musgrave identified three redistributive stabilization function, the allocation function, and the in which federal system where "a hierarchical structure of governments is, simultaneously, citizen of more than a one government" (Tresch 2002, p. theory assigns the federal (central) government the the stability and redistribution. Burki et al. succinctly functions of macroeconomic summarize the reasons for this: responsibility for stabilization on access to an independent monetary grounds The measures. policy and are too open for effective countercyclical income redistribution function is also assigned to the central government, are likely on the grounds that local attempts to address income disparities The central government is assigned that local economies have no provoke higher-income groups to income groups to move to high-benefit to The third function, resource allocation, is left the benefits of particular services can be achieved local by permitting preferences" (Burki et al. argument for decentralization The normative briefly in the are to low-tax areas. et al. (Burki to lower units of areas 1999, p. 21) government, because "if confined to local jurisdictions, welfare 1999, p. 21). It is thus comes principles from the no efficiency gains for the division of were correspondence" and spelled out by public in resource correspondence" when he describes what an according to allocation. sector functions outlined Wallace Oates "decentralization gains coincidence that the strongest who, through his theorem," showed the welfare- of public services. enhancing potentials of decentralized provision of "perfect and low the level and mix of such services to vary previous paragraph notions of "perfect largely move optimal Oates uses the concept form of federalism to be: to provide the set of n public optimal form of federal government exists a level of government for each goods would be one in which there is subset of the population over which the consumption of a public good The from the defined. This would be sufficient to internalize the benefits ought |
