Equilibrium Institutions: The Federal-Proportional Trade Off

Durable democracies display a huge variety of combinations of basic institutional formulas. A quantitative logical model shows that while there are multiple equilibrium sets of institutions, each involves some trade-off between the size of the country, the territorial structure of government and the electoral system. Specifically, the larger the country, the more important is federalism in comparison to proportional representation electoral rules for the durability of democratic institutions. The explanatory power of the model is positively tested on all current durable democratic countries. It is also illustrated with a few both fitting and deviant cases. A relevant implication is that the room for manipulation of the choice of institutions is large, but not unlimited, as the choices for a durable democracy are constrained by bounded trade-offs between the values of major institutional variables.