Abstract
Successful states maintain a functional relationship between local politics and national politics. Property rights have depended on recognition by local communities since before any states existed. To maintain unity in an extensive domain, a state needs a cadre of agents (mandarins) who expect national leaders to reward them for serving the state above any local connection. But investments require locally rooted investors with confidence in the state's protection, so a stable prosperous state must earn the trust of local elites (gentry). Local and national leadership can be aligned in two fundamentally different ways: by top-down influence of national leaders in local politics and by bottom-up influence of local leaders in national politics. Top-down influence is dominant in successful autocratic states. In successful democracies, national leaders need bottom-up approval from local groups throughout the nation, and local leaders who perform well can become competitive candidates for national leadership. International assistance for democratic development can fail when local politics is neglected.

Reference
Roger B. Myerson, "Local Politics in Nations and Empires", in Claude Menard and Mary M. Shirley, (eds.), Handbook of New Institutional Economics, Second Edition, Springer, 2025, Open Access.