Resumo:
Brazil became a highly decentralized country following democratization and the 1988
Constitution. The consequences of decentralization at the federal level are quite clear:
the federal government is facing ®nancial constraints and di culties in building governing
coalitions, allowing the Presidents to govern and to implement public policies, especially those
concerning ®scal control. At the level of the states, however, the results of decentralization are
quite heterogeneous given the country's high degree of regional inequality. The article
identi®es the cleavages and tensions surrounding federal±state relations, as well as the mutual
dependency of the states and the federal government. It argues that the Brazilian experience of
political and ®nancial decentralization has contributed to the prospects of democratic con-
solidation and has forced the federal government to negotiate and compromise with sub-
national governments the implementation of national policies. On the other hand, the
Brazilian experience highlights the constraints of decentralization in countries with deep-
rooted regional disparities. Furthermore, the ®nancial weakness of the federal government
which has been brought about by decentralization and by ®scal control brings new tensions to
the federal arrangements and to public policies.
