From Elections to Appointments of the Regional Governors: Major Challenges and Outcomes

Publication date
Tuesday, 05.02.2008

S. Sinelnikov-Murylev, P. Kadochnikov, I. Trunin, S. Chetverikov



In 2005 Russian Federation moved from the elections of the regional governor to their appointment by the federal center. The study analyzes the possible changes in the regional governments fiscal policy due to the change of the preferences aggregation mechanism at the regional level. It includes an overview of the existing theoretical and empirical studies, as well as international experience of the regional governments formation. The study also contains a theoretical and empirical analysis of the possible changes in the fiscal policy in Russia at the regional level as a result of the implemented reform.

Introduction    7
1. Theoretical and Empirical Models of the Public Choice Mechanisms and Preference Aggregation at the Regional Level    8
1.1. Specific Features of Provision of Public Goods at the Regional and Local Levels    12
   1.1.1. Effectiveness of Differentiation of Public Benefits by Regions; Decentralization Theorem    15
   1.1.2. Limited Provision of Public Benefits Sub-Nationally; Optimum Size of the Region    17
   1.1.3. Local Public Goods Provided by Sub-National Governments    25
   1.1.4. The Problem of Interregional Externalities Emerging in Public Goods Provision at the Sub-National Level    31
1.2. Regional Governments Preferences: Aggregation    35
   1.2.1. Restrictions in Building a Tool for Aggregation of Individual Preferences    36
   1.2.2. Establishment of Preferences as those of the Benevolent Dictator    37
   1.2.3. Aggregating Individual Preferences Based on Democratic Electoral Procedures    40
   1.2.4. Democratic Electoral Preferences Aggregation Mechanisms and Political Business Cycles    44
1.3. Preferences of Regional Governments in Models of Bureaucracy    51
   1.3.1. Bureaucrats’ Preferences and Budget Increase    52
   1.3.2. Realization of Bureaucrats’ Preferences by Manipulating Alternative Options at Elections    56
   1.3.3. Empirical Studies of Median Voter and Bureaucracy Models    61
   1.3.4. Modeling Regions’ Support to the Central Federal Government at Elections    67
2. Elections and Appointment of Subnational Authorities: International Experience and Russian Reform    73
2.1. Assessing Contractual Relations between Federal (National) and Regional Governments: A Review of the International Experience and Possible Implications for Russian Federation    73
   2.1.1. Principal Issues and Concepts    74
   2.1.2. Implementing Effective Transfer Systems: Criteria & “Trade-offs”    77
   2.1.3. Types of Intergovernmental Transfers & Mechanisms of Distribution/Provision    82
   2.1.4. Conceptual Framework    88
   2.1.5. Country Assessments    89
   2.1.6. A Typology of Federal–Regional Contractual Relationships    150
2.2. Assessing the Executive Functions of Regional Governments in Multilevel Governance Systems: Review of International Experiences    160
   2.2.1. Territory and Institutions: What is at Stake and Why Do the Form and Function of Regional Executives Matter? A Review of the Theoretical/Conceptual Literature on the Executive Functions of Regional Government    162
   2.2.2. Territory and Institutions – How to Evaluate a Regional Executive System – Form, Size, Efficiency, and Democracy: A Review of Appointed, Elected, and Mixed Regional Executive Systems    167
   2.2.3. Description, History, and Assessment of the French Systems of Regional Executive Functions (with examples from Italy and Spain)    181
   2.2.4. The Political Dimension of Regional Executives of France (Italy and Spain)    194
   2.2.5. Regional-Central Relations in France (Italy and Spain)    198
   2.2.6. The Fiscal Position of Regional Heads in France    202
   2.2.7. Conclusion: Merits and Weaknesses of Appointed Executives and Mixed Systems    208
2.3. Reform of the Regional Elections in the Russian Federation    210
   2.3.1. Background. Stages in development of the regional governments leadership in post-socialist Russia    210
   2.3.2. An Analysis of Constitutionality of the New Procedure of Appointment and Dismissal of the Regional Governors    217
3. Modeling Financial Behavior of the Regional Governments under Changes of the Political Structure of Russian Federation    223
3.1. Main Assumptions and Structure of the Model    223
3.2. The Regional and Federal Governments’ Preferences    231
3.3. Modeling the Financial Behavior of the Regional Governments after the Changesof the Political Structure of the Russian Federation    236
4. An Empirical Analysis of the Reform Results    244
4.1. The Main Hypotheses for the Changes in the Financial Behavior of Regional Governments    244
4.2. The Specification of Econometric Models and the Data Description    250
4.3. Results of the Econometric Estimation of Regional Budget Expenditure Models    257
   4.3.1. Expenditures on Public Health Care    257
   4.3.2. Expenditures on Public Education    260
   4.3.3. Expenditures on General State Issues    263
   4.3.4. Expenditures on Law-Enforcement Activity    266
   4.3.5. Expenditures on Housing and Utilities    269
   4.3.6. Expenditures on Social Policy    272
Conclusions    277
Bibliography    283


From Elections to Appointments of the Regional Governors: Major Challenges and Outcomes / S. Sinelnikov-Murylev, P. Kadochnikov, I. Trunin, S. Chetverikov ; Consortium for Economic Policy Research and Advice ; Canadian Agency for International Development [et al.]. – М. : IET, 2008. – 297 p. : il.

ISBN 978-5-93255-244-5

The research and the publication were undertaken in the frame-work of  CEPRA (Consortium for Economic Policy Research and Advice), project funded by the Canadian Agency for International Development (CIDA). 

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