Date Posted: February 2012
The strengths and weaknesses of federalism have been debated for centuries. But one major possible advantage of building decentralization and limited government into a constitution has been largely ignored in the debate so far: its potential for reducing the costs of widespread political ignorance. The argument of this paper is simple, but has potentially important implications: Constitutional federalism enables citizens to “vote with their feet,” and foot voters have much stronger incentives to make well-informed decisions than more conventional ballot box voters. The informational advantage of foot voting over ballot box voting suggests that decentralized federalism can increase citizen welfare and democratic accountability relative to policymaking in a centralized unitary state.
Ballot box voters have strong incentives to be “rationally ignorant” about the candidates and policies they vote on because the chance that any one vote will have a decisive impact on an electoral outcome is vanishingly small. For the same reason, they also have little or no incentive to logically evaluate the information they do know. By contrast, “foot voters” choosing a jurisdiction in which to reside have much stronger incentives to acquire information and use it rationally; the decisions they make are individually decisive.
Political ignorance is far from the only factor that needs to be considered in determining the degree of centralization in political systems. But it deserves greater attention than it has received so far.