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Indiana University Bloomington


The Kelley Advantage

The department is home to the authors of Managerial Economics and Business Strategy and Games and Information: An Introduction to Game Theory, two of the nation’s leading textbooks in the field.

Research and Publications

Journal Articles

Ethnic Heterogeneity, Economic Integration and Atomistic Federalism in the Pacific

2006, Pacific Economic Bulletin

Philip T. Powell


Atomistic federalism describes a federal system of government with a high ratio of constitutional jurisdictions to national population. The system is appropriate when ethnic heterogeneity is high and economic activity is not well integrated between communities. New theoretical research suggests that atomistic federalism in the Pacific will increase the efficiency of public administration, increase state legitimacy through elevation of voter participation rates, and reduce
parliamentary hyper-competition. A game-theoretic model of cooperation between communities in a Pacific island country suggests a higher probability of regional state failure in the future unless constitutional structures are reformed to build state legitimacy. Palau offers a successful working model of atomistic federalism in the Pacific region.


Powell, P. T. (2006), "Ethnic Heterogeneity, Economic Integration and Atomistic Federalism in the Pacific," Pacific Economic Bulletin, Vol. 21, No. 2, pp. 53-69.