The Cato Institute’s Dan Mitchell delivers the goods.
(Option#1) Secession: The two greatly different parts of Ukraine could arrange an amicable divorce.
(Option#2) Decentralization: You know, copy the Swiss model of radical decentralization.
Dan Mitchell has a policy reason, as do I, for supporting weaker national governments. Simply stated, there is strong evidence that decentralization means more tax competition. When governments are forced to compete for jobs and investment, the economy is less likely to be burdened with high tax rates and excessive redistribution. Doesn’t sound very Krugmanesque, does it?
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