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Much of the literature on federalism and democracy claims it as an empirical fact that federalism is beneficial for democratic development, especially in large and diverse societies. 1 As Stepan has observed,“in fact, every single longstanding democracy in a territorially based multilingual and multinational polity is a federal state. Although there are many multinational polities in the world, few of them are democracies. Those multinational democracies that do exist, however (Switzerland, Canada, Belgium, Spain, and India), are all federal”(Stepan 1999: 19–20). Where theoretical literature elaborates on the connection between federalism and democracy, the reasoning derives from the consensus that to be successful federalism requires all of its benefits: well-functioning democratic institutions, judicial system, integrated national political parties, and appropriate electoral incentives created by democratic political competition. The basic finding of the literature is that only in well-functioning democracies can federalism be a stable and effective form of government. And conversely, outside the democratic context, federalism is ultimately an unstable form, which logically progresses either to territorial disintegration or to becoming a mere constitutional formality.

Meanwhile, showing that democracy is crucial for maintaining federal stability does not in any way imply that federalism helps to achieve democratic success. In fact, what federal theories show is that in the long run, in equilibrium, democracy must be present in order for federalism to thrive. This has no bearing on what adding federalism to a political regime would do. In