The Cooperative Capacity of Swiss Federalism

Abstract

The federal structure is a defining feature of the Swiss polity. According to the disenchanted hypothesis, which argues that the Swiss political culture of accommodating competing interests has come under pressures, we should expect that cooperation among the cantons and between the federal and cantonal governments has deteriorated over the last 25 years. However, inter-cantonal coordination has increased substantially. In addition, the successful negotiation of the NFA shows that the federal and cantonal governments can reach comprehensive agreements. This study provides empirical analyses of the NFA reform and of inter-cantonal tax competition. The NFA analysis shows that the cantons successfully coordinated their interests vis-à-vis the federal government, and the findings of the spatial econometric tax competition investigation suggest that inter-cantonal coordination in the NFA had an attenuating effect on tax competition. Overall, the problem-solving capacity of the Swiss federal system is remarkably high - not disenchanted.