Delegative Federalism? Subnational Abdication and Executive Fiscal Centralisation in Argentina

Abstract

What accounts for the varying and increasing levels of centralisation in federal systems? This article contributes to this debate showing that, despite normative and theoretical arguments on the advantages of decentralised fiscal federalism, changing economic conditions and governance hurdles prompt an increasing trend towards executive fiscal centralisation. It seeks to unravel this theoretical riddle by proposing the concept of delegative federalism, defined as a model of federal governance suitable for explaining how economic contexts impel a dynamic of subnational assent to centralisation policies and reforms that oftentimes breach the historic institutional empowerment of subnational authorities. The experience of Argentina, a paradigmatic case of hyper-presidentialist federalism amid institutionally strong provinces, is analysed to show that national executives may increasingly extend their reach not only because of congressional dysfunction but also due to the disproportionate sway of overrepresented, mostly transfer-dependent subnational governments that shun revenue responsibility. Accordingly, and perpetuating centralisation, they delegate tax authority in crises times and abdicate it further when economic windfall affords them with predictable federal grants.