Fears of Redistribution, Decentralization and Secession: Evidence from Bolivia’s Referendum for Departmental Autonomy

Abstract

Recent years have witnessed strong movements toward decentralization and secession. The former Soviet Union, Yugoslavia, Czechoslovaquia and Serbia and Montenegro have disintegrated. Movements for regional autonomy and even independence have gained larger support in Bolivia, Canada, Spain, France and Italy. What is the importance of redistributive politics in explaining decentralization and secession outcomes in a democratic polity? This paper attempts to answer this question building a simple rational choice model in which individuals’ preferences over alternative institutional regimes are derived from their economic and social consequences. The model predicts that, in a national referendum, relatively rich (poor) people in relatively rich regions and relatively poor (rich) people in the relatively poor regions will support (oppose) decentralization and secession. As a consequence, relatively rich (poor) regions will have an absolute majority supporting (opposing) decentralization. The national outcome will depend on the gaps between regional and national median incomes and the sizes of the population in each region. An important quality of the model is that it has sharp quantitative implications. Given information on regional and national median incomes, and the proportion of an electoral pool whose income is below these levels, the model predicts the proportion of the electoral poll that will support or oppose decentralization. I use data from Bolivia’s referendum for departmental autonomy and estimates of per-capita household income indicators to contrast observed vs. predicted voting outcomes. The model accounts for almost 2/3 of the variation in voting behavior. The fit is surprisingly good in light of model’s simplicity. This result suggests that fears of redistribution play an important role in shaping decentralization and secession outcomes, at least in the Bolivian case.political economy, median voter, decentralization, redistribution, sucession, Bolivia, referendum, departamental autonom