1  

Why do some municipalities use democratic innovations and others do not?

Determinants of local direct democracy in Finland

Maija Karjalainen & Maija Setälä

University of Turku

mhkarj@utu.fi, maiset@utu.fi

DRAFT – DO NOT QUOTE WITHOUT PERMISSION

Paper prepared for the ECPR General Conference in Bordeaux, 4-7 September 2013.

Section S19: Four Decades of Democratic Innovation Research: Revisiting Theories, Concepts and

Methods

Panel P413: What Explains (the Absence of) Participatory Reforms?

____________________________________________________________________ Abstract This paper discusses why some autonomous political units – municipalities – introduce democratic innovations while numerous others do not. While institutions that engage citizens directly in the democratic decision-making have become more and more common in advanced industrialized countries, representative elites play a significant role in their implementation. The decision to adopt democratic innovations often remains at the hands of elected representatives, as well as their impact on policies. It still seems rather unpredictable, where and under what institutional and political conditions they are used. In this paper, system-level data from municipalities in Finland are analyzed in order to identify conditions facilitating the use of democratic innovations. The focus is specifically on municipal referendums and citizens’ initiatives, which were introduced at the local level in Finland in 1990. Since then, more than a hundred referendums and initiatives have taken place. Data on the frequency, issues and effects of direct democratic instruments during 1991-2012 are compiled from official statistics and local newspapers. Two types of independent variables are used: Those related to representative democratic institutions include effective number of parties and particular parties’ share of votes. The other explanatory variables are population, geographical location of the municipality and turnout in the previous local elections. The preliminary analyses show that the more seats a leftist party has in the local council, the more likely it is that local referendums occur. Second, citizens’ initiatives are more likely to occur in municipalities that have large population and low electoral turnout.

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1. Introduction

Developed industrialized countries have seen a growing number of different

instruments of direct citizen participation during the last few decades (Fung, 2006;

Newton and Geissel, 2012; Smith, 2009). These instruments vary from referendums,

citizens’ initiatives and deliberative mini-publics to co-governance structures and

public consultation, to mention some. Common to all these so called democratic

innovations is that they have been designed to increase and deepen citizen

participation in political decision-making (Smith, 2009, 1). Quite expectedly,

alongside with the growing use and case research on innovations also the attempts to

evaluate them and to develop comprehensive frameworks for evaluation have

emerged during the last ten years (cf. Geissel, 2012, 213; Michels, 2011). However, it

still seems rather unpredictable, which political units adopt these innovations and

under what conditions.

After the deliberative turn in democratic theory (Dryzek, 2001) the institutions of

direct citizen participation have been no longer seen as substitutes for elections and

other representative institutions, whereas as complementary institutions capable of

strengthening democratic legitimacy (Chambers, 2003; Goodin, 2008; Warren and

Pearse, 2008, 3). Several authors have also reminded that institutions of deliberative

and direct democracy are always embedded in a representative democratic system and

should thus be studied in that context (Hoppe, 2011; Mansbridge et al., 2012;

Parkinson, 2003).

In stable democracies, elections usually take place on a regular basis and their results

are seldom contested. However, when it comes to democratic innovations, the elected

representatives must in most cases explicitly decide whether to adopt them or not and

whether to follow their results – the input from citizen participation – or not. Citizen

juries, co-governance and other democratic innovations are therefore often used on ad

hoc basis. Also large proportion of referendums around the world are initiated by

representative governments (Morel, 2001). The emergence of democratic innovations

is, thus, somewhat paradoxical. Their idea of engaging citizens is partly in

contradiction with the principles of representative government, yet their

implementation is decided by the elected representatives. Furthermore, one could ask

that why would we expect elected, rational representatives to let go of their hard-

earned, authorized democratic power (Rahat, 2009)?

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The aim of this paper is to study why some municipalities in Finland have experience

of direct democratic instruments while numerous others have not. The analysis is

restricted to two direct democratic innovations – referendum and citizens’ initiative –

and the empirical focus is on the local government in Finland. First, the instruments

of direct democracy in Finland are introduced and placed in the wider context of

direct democratic institutions. Then, the hypotheses are formed based on the

theoretical discussion about the motives for and determinants of the use of different

democratic innovations. After that, data on the use of local referendums and citizens’

initiatives as well as applied methods are described. Finally, after a brief description

of preliminary results, the implications of the findings and pathways for future

research are discussed.

2. Institutions of local direct democracy in Finland

The Finnish legislation recognizes national consultative referendums, municipal

consultative referendums and municipal referendum initiatives. Although there have

been only two national referendums in Finland since the independence, the agenda

initiative was introduced as a new national-level direct democratic instrument in

2011, in the footsteps of the European Citizens’ Initiative (European Union, 2011).

The history of Finnish direct democracy, however, spans over more than 20 years at

the level of local government. Until 1990 it had been possible for municipal councils

to organize referendums, but since 1991 municipal referendums and citizens’

initiatives have had their legal basis in the Local Government Act1.

The Local Government Act specifies that local councils may decide to hold a

referendum on an issue that concerns the municipality. These referendums are non-

binding, and all eligible voters have a right to vote in the ballot. The question of the

referendum can also concern only a part of the municipality. 2 The residents

representing at least five per cent of the eligible voters in the municipality also have

the right to submit a referendum initiative. The local council then has to decide as

                                                                                                               1 Local Government Act 365/1995, unofficial English translation: The Association of Finnish Local 2 Local Government Act 365/1995, Section 30

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soon as possible, whether to hold a referendum on the issue referred to in the initiative

or not.3

Several authors have categorized and classified direct democratic instruments (cf.

Breuer, 2007; Schiller, 2011; Setälä, 1999; Suksi, 1993). The municipal referendums

in Finland can be classified as optional or facultative referendums in contrast to

mandatory referendums which are required on particular issues by a law (Setälä,

2009; Suksi, 1993). In optional referendums, the decision to organize a referendum is

made on an ad hoc basis, but the initiator may vary. In practice, the question of who

initiates the referendum has major impacts on the use and dynamics of referendums

(Morel, 2001). While the government may initiate a referendum in order to promote a

decision that favors government’s authority (ibid.), citizen-initiated referendums can

be used to overturn decision made by the parliamentary majority or to promote

propositions of a minority of the voting population (Vatter, 2000).

Finnish municipal referendums may be initiated either by a group of representatives

in the municipal council or by a group of residents of the municipality, in the form of

a referendum initiative. If the initiative is supported by at least five percent of the

municipality residents entitled to vote in municipal elections, the council has to decide

within six months whether to hold a referendum proposed in the initiative. There is,

however, one exception: A mandatory referendum in unsuccessful municipal merger

negotiations. This kind of situation is linked to the structural reform of the Finnish

local government 4 and gives the ministry responsible for structural reform the

authority to decide upon the organization of a referendum in a particular municipality

that has resisted the planned local government structure.

Suksi (1993, 29) divides referendums further into decisive and consultative. In

decisive referendums the expressed opinion of the people settles the matter definitely,

whereas in consultative referendums the final decision on the issue and the result of

the vote is reserved to another body – usually legislature. In Finnish local politics,

both the referendum initiative and referendum itself are consultative in the sense that

they dot not oblige the municipal council to take account the input of the residents. In

other words, the local council neither has to comply with the referendum result nor

                                                                                                               3 Local Government Act 365/1995, Section 31 4 Article 16, Kuntajakolaki 1698/2009, later Kuntarakennelaki 478/2013.

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organize the referendum proposed in the citizens’ initiative. This consultative status

reflects the legislation of national referendums, which are also government-initiated

and non-binding5.

In Schiller’s terms (2011, 15), the Finnish direct democratic instruments can be

described as having some “direct-democratic quality” instead of constituting

procedures of full direct decision-making. Government-initiated advisory

referendums are sometimes also called as plebiscites or plebiscitary referendums. This

terminology bears a slightly negative connotation pointing to the fact that the

instruments are often used by political elites when they want to get public acceptance

for some pre-defined policies (Büchi, 2011; Rahat, 2009; Suksi, 1993). Binding

referendums and full-scale citizens’ initiatives which automatically lead to a decision

or to a referendum do exist at the local level in Switzerland and in some German

Länder (ibid., 19). However, in the Nordic countries direct democratic instruments are

in general of consultative sort.

3. Theory and hypotheses

Most broadly defined, democratic innovations are institutions of citizens’ non-

electoral participation. They can thus be distinguished from elections and other

institutions of ‘competitive representation’, in which citizens exercise their political

rights by voting for representatives (Fung & Cohen, 2004). There are, however, a

huge variety of these non-electoral institutions. Contemporary democratic theories

have put forward different – and partly contradictory – normative grounds related to

who should participate and how should citizens’ preferences be formed (cf. Budge,

2012; Dryzek, 2002; Gutmann and Thompson, 2009; Saward, 2001). The argument

made above can be, however, generalized to any other types of democratic

innovations: in terms of the real usage, functions and impacts of democratic

innovations it matters a great deal whether it is the elected representatives or citizens

who can initiate the use of a particular instrument (Morel, 2001; Setälä, 1999; Smith,

2009).

From the point of view of the elected representatives, democratic innovations appear

as optional add-ons to the traditional venues of decision-making (Hoppe, 2011). From                                                                                                                5 The Constitution of Finland 731/1999

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the pragmatic or administrative point of view, for example referendums can be

opposed because they cause delays in the decision-making, are expensive and produce

unexpected results (Setälä, 1999). Furthermore, in decentralized countries local

politicians have been delegated major resources and responsibilities, and it is thus

even more likely that elected politicians will not spontaneously let go their control

over the political decision-making process (Andersson & Laerhoven, 2007). Like

other Nordic welfare states, Finland is a highly decentralized country with a long

tradition of strong municipalities (OECD, 2012). In addition to health care,

municipalities are responsible for a variety of other tasks such as children’s day care,

all education except universities, water and energy supply, waste management and

development of public transportation6. Knowing that local councils make important

decisions, local politicians clearly have an incentive to keep the decision-making

power in their own hands.

On the other hand, there are both enlightened and pragmatic motivations why the

empowered local elites should introduce participatory reforms and democratic

innovations (Smith, 2009). The purpose can be sincerely to fix the misalignment

between the citizens and representatives or enrich the information input to decision-

making (Hoppe, 2011). An ideal democratic system should work like this, i.e.

perceived decrease in political support would lead to the transformation of decision-

making processes into more legitimate and participatory. Decreased voter turnout and

citizens’ negative attitudes towards representative institutions could in this case

explain the use of democratic innovations in some political units. Furthermore,

literature on the positive side effects of direct democracy and deliberation (cf.

Andersen and Hansen, 2007; Farrar et al., 2010; Lupia and Matsusaka, 2004) suggests

that the representative elites might use democratic innovations to educate the

citizenry.

In real-world politics, however, the time and economic resources of the empowered

elites are scarce, and the enlightened motives described above may often remain as

ideals. The explanation for why democratic innovations are introduced somewhere

but not everywhere should therefore be sought not only in the citizens’ attitudes

towards the democratic system but also – and perhaps even more importantly – in the

                                                                                                               6 Finnish Association of Local and Regional Authorities, www.localfinland.fi, visited on the 3rd of May, 2013.

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representative democratic context such as government composition, party system and

political ideologies, and socio-demographic as well as economic factors (cf. Delli

Carpini et al., 2004; Hoppe, 2011).

The research on government-initiated referendums has identified several motives for

the use of these direct democratic instruments (Björklund, 1982; Morel, 2001;

Qvortrup, 2006). Rahat (2009, 102) categorizes these motives under avoidance,

addition and contradiction. Avoidance refers to situations where a decision might lead

to a split within a party, coalition or the electorate. Because all these three options

would be politically or re-election-wise difficult, parties may want to externalize the

decision to the anonymous public (cf. Breuer, 2009; Setälä, 2006). Addition refers to

situations where a decision already has the necessary majority support, but popular

opinion is asked anyhow. This may have the advantages of legitimizing the decision

further or giving extra credits to the individual representative or the group proposing

direct democracy. Looking at democratic innovations in general, Smith (2009, 23)

takes up these same two motives and argues that democratic innovations are often

initiated in order to legitimate some policies which could otherwise face much

opposition or confirm decisions that have been made elsewhere. The third motive –

contradiction – refers to situations where a decision (to change or preserve something)

has already been made, some minority group is dissatisfied with it and tries to

challenge it by creating a new decision-making forum (Rahat, 2009, 103).

In a representative democratic system these motives are shaped by electoral strategies

and salient political issues but they can also rise from the size of political groups and

the balance of power between them. Veto-player theory argues that political change is

the more difficult the more players are involved in deciding on policies (Tsebelis,

1995). Although binding referendums may add another veto-player in the game (Hug

& Tsebelis, 2002), government-initiated referendums on the other hand can serve as

facilitators of policy change. From this perspective, the avoidance strategy would

become especially useful in situations where there are many political groups or parties

in the government and a consensus is hard to reach (cf. Damore et al., 2012).

In Finland, the municipal councils are elected every four years in a proportional

election with open party lists. Traditionally, all parties that have succeeded in getting

candidates in the local council are also present in the executive board. This means that

there are no government-opposition divisions in the local politics, at least in the case

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of executive boards. However, in the councils’ decision-making the proportions of

political parties’ seats do make a difference, and the more parties are present, the

more difficult it is to make decisions. Based on the discussion above, it can thus be

assumed that the likelihood of referendums increases with the effective number of

parties in local councils.

• Hypothesis 1: The more parties there are in the local council, the more likely it

is that a municipal referendum occurs.

Direct participation of citizens is given different values and emphasis in different

political ideologies. In Europe, direct democracy and government transparency have

been one of the guiding principles of the green parties (Drummond et al., 2001). For

example in Germany, the Green party has demanded direct democracy in the

legislation, and attracted especially those who were actively doing the participatory

style of politics in the 1960s (ibid., 143-6). Traditionally also the Left has demanded

more popular control over collective decisions to foster social justice, community and

other values (Fung and Cohen, 2004). The introduction of Participatory Budgeting in

Latin America has often taken place under a leftist government (Sintomer, 2008 in

Font and Galais, 2011). It can therefore be assumed that the more seats the green and

leftist parties have in the local council, the more government-initiated referendums

are organized.

• Hypothesis 2: The bigger share of seats the leftist and green parties have in the

local council, the more likely it is that a municipal referendum occurs.

In citizens’ initiatives, however, a group of voters puts an issue to the political agenda

or proposes a referendum. Initiative can thus be regarded as a means of influence of

some minority group, which does not have a broad basis in the legislative (Vatter,

2000). In practice, the campaigns to collect signatures are seldom put forward by

individual citizens but civic associations or smaller political parties (Gerber &

Phillips, 2005). Of the aforementioned motives, contradiction would thus seem to be a

potential motive for citizens’ initiatives. It would make sense for an opposition party

or a small political group to start collecting signatures if a decision that they oppose

will be or already was supported by a majority in the government.

Therefore, the more inclusive the government is in relation to parties in the

parliament, the less likely would it be that minorities would have to push forward

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policies with initiatives (cf. Vatter, 2000). Applied to Finnish local politics, one could

assume that the more political parties – or other groups – are represented in the local

council, the less likely it is that initiatives occur. This hypothesis is supported also by

prior studies showing that large number of government parties and fragmentation of

party system decrease the likelihood of citizen-initiated direct democratic processes in

consensus democracies (Vatter, 2000).

• Hypothesis 3: The more political parties or other groups are represented in the

local council, the less likely it is that referendum initiatives occur.

Some authors also suggest that the difficulty to predict voter preferences is linked to

policy proposals put forward by the citizens (Matsusaka and McCarty, 2001; Vatter,

2000). If the decision-making body constantly ignores some policy that has wide

support in (some part of) the citizenry, and the legislation allows for direct

democracy, it is no surprise that a citizens’ initiative is used. Predicting voter

preferences can be especially challenging the bigger the population is, the more

sparsely people live in the municipality area and the more evenly balanced the urban

and rural shares of the population are (Matsusaka and McCarty, 2001).

• Hypothesis 4: The more unpredictable are the voter preferences, the more

likely it is that referendum initiatives occur.

4. Data and methods

The data on the use of direct democratic innovations in Finnish municipalities were

compiled from government statistics7, Association of Local and Regional Authorities

in Finland and by a self-conducted electronic survey, which was sent to all 336

municipalities in January 2013. These data were completed by a systematic regional

newspaper and media review for the period 1991-2012. It is noteworthy, that while

basic information concerning municipal referendums have been recorded by the

Ministry of Justice (responsible for elections), no authority has systematically

collected data on the occurrence and outcomes of referendum initiatives.

4.1. Experience of direct democratic innovations in Finnish local politics                                                                                                                7 Ministry of Justice Finland: Municipal referendums

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Since the instruments of local direct democracy were introduced in the legislation in

1990, there have been altogether 60 municipal referendums in the Finnish

municipalities. As can be seen in table 1., referendums have been mostly organized on

municipal mergers. Other issues include road construction (traffic), building a waste

burning plant (waste and energy) and changing province or name of the municipality

(municipal identity). The use of referendums has remained quite stable over time; on

average there have been ten referendums during every four years, which is the term of

local councils.

Table 1. The use of referendums in Finnish municipalities 1991-2012

Local council term

Issue 1991-92 1993-96 1997-2000 2001-04 2005-08 2009-12 Total

Municipal merger 9 8 10 9 12 7 55

Traffic 2

2

Waste and energy

1

1

Municipal identity

1

1 2

Total 11 8 11 9 13 8 60

The approximate number of referendum initiatives is equivalent to referendums;

based on research conducted for this study there have been altogether 59 initiatives

demanding a local referendum during 1991 and 2012. The variety of policy issues put

forward with initiatives is much wider than in referendums. Municipal merger still

comes as the most popular issue, but many initiatives have also concerned the

construction of roads, underground car parks and bridges (traffic) or the preservation

of the existing network of local schools (education). The fourth common issue area in

initiatives is municipal identity, which consists of questions such as coat of arms, type

– city or municipality – and regional orientation of the municipality. Other issues

raised on the decision-making agenda with initiatives include for example social and

health services, leisure activities, waste and energy. The full list of referendum and

initiative questions and their categorization is presented in the Appendix.

Unlike the use of referendums, the occurrence of referendum initiatives seems to have

increased since they were introduced in the legislation. In the beginning of 1990s,

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only a few municipalities experienced citizens’ initiatives, whereas during the latter

half of the 2000’s there were initiatives in more than 20 municipalities.

Table 2. The use of referendum initiatives in Finnish municipalities 1991-2012

Local council term

Issue 1991-92 1993-96 1997-2000 2001-04 2005-08 2009-12 Total

Municipal merger 4 12 7 23

Traffic 2 2 2 1 2 9

Social and health services 1 1 1 3

Education 1 3 4 8

Leisure activities 1 2 3

Waste and energy 1 2 3

Municipal identity 1 1 3 5

Other 1 1 1 2 5

Total 3 2 5 9 23 17 59

The use of direct democratic innovations is quite clearly intertwined with structural

reforms in the Finnish local government. The structure of local government has

changed quite extensively from the 1960s to date. The first wave of municipal

mergers took place in the 1960s-1970s and the second in 2005-2011, resulting in a

local government structure of 304 municipalities in the beginning of 20138. There are

even more municipal mergers in the horizon, because a radical reform of local

government is one of the main objectives of the current national government,

suggesting that the number of municipalities in Finland should be reduced to 66-70.

As can be seen in the previous tables 1. and 2., the issue of municipal mergers is

dominating especially local referendums but also referendum initiatives. As much as

92 percent of the referendums have dealt with municipal mergers, and for the

initiatives the figure is 39 percent. Central government policies to reduce the number

of local authorities also play a part in the timing and frequency of the two direct

democratic innovations. The PARAS-policy programme started in 2005 encouraged

                                                                                                               8 The Åland Islands – an autonomous, demilitarized region of Finland – is divided into 16 municipalities. Due to the structure of official statistics these municipalities are not included in this study.

  12  

municipalities to form bigger administrative units with various sticks and carrots, and

led to a major bunch of municipal mergers in the beginning of 2007. The prospect of

these mergers did most likely intensify the debate on local democracy and

government in several municipalities, which is reflected in the bigger number of

referendums and initiatives during the local council term 2005-2008 in tables 1. and 2.

It is therefore plausible that the prospect of municipal merger is one of the

explanatory factors of the use of these instruments. It would be, however, too hasty to

assume that it explained all of the variation between local administrations. Since 1990

at least 140 municipal units have participated in successful merger negotiations and

even more have been involved in discontinued negotiations at some point during this

time period9. Some municipalities have even merged into bigger units of local

government several times. There are, however, only 79 cases when a referendum has

been initiated by the local government or by the citizens on the issue of municipal

merger indicating that there must be some other conditions conducive to the use of

direct democratic innovations.

4.2 Operationalization and methods

The unit of analysis is municipal administration, i.e. a four-year term in a given

municipality. Due to the changes in the structure of local government the names and

territories of municipalities have changed quite extensively during the last 20 years.

Municipality is therefore not a suitable unit of analysis, because direct democratic

innovations have been used in several municipalities that no longer exist.

In order to avoid selection biases, the sample must not consist only of positive cases,

i.e. those municipal administrations where the participatory process has occurred

(Gerring, 2008). Therefore, a purposive sample was selected consisting of all known

cases with either a referendum or citizens’ initiative (n=111) and some negative cases

(n=198) selected randomly among the whole population of municipal administrations

in 1991-2012 (n=approx. 2600). The final sample therefore consists of 309

purposively and randomly selected municipal administrations. Finally, one of the

                                                                                                               9 Finnish Association of Local and Regional Authorities: Document ”The number of municipalities and cities 1900-2013”, http://www.kunnat.net/fi/tietopankit/tilastot/aluejaot/kuntien-lukumaara/Sivut/default.aspx, visited on the 20th of May, 2013.

  13  

referendum cases was removed before the statistical analyses because it was the rare

type of mandatory referendum described in chapter 2.

The dependent variables – use of both two direct democratic innovations – are coded

as dummy variables10. Independent variables related to the representative democratic

context include the effective number of parties in the municipal council (Laakso and

Taagepera, 1979), the Green party’s share of seats and two leftist parties’ – moderate

Social Democratic Party (SDP) and the Left Alliance (VAS) – share of seats in the

council11. The unpredictability of voter preferences is measured with population size.

In addition, turnout in the last municipal elections and geographical location of the

municipality are used as control variables.12 Finally, the existence of a citizens’

initiative is also used as a predictor for the use of referendums. The coding of these

variables is presented in the Appendix.

Binary logistic regression is applied to analyse the predictors of the use of municipal

referendums and citizens’ initiatives. Logistic regression is a technique to predict

group membership for individual cases and it is especially suitable for research in

which there are both continuous and discrete explanatory variables, which is the case

in this study (Tabachnick and Fidell, 2007, 439).

5. Results

Direct logistic regressions were conducted in two steps in order to analyze the impact

of party system factors alone and also together with control variables. The first model

does seem to fit to the data, although it is only able to explain approximately eight per

cent of the variation. As can be seen in table 3., the first hypothesis, which assumed

that government-initiated referendums are used more in fragmented party systems,

does not get support from the data. However, the share of seats of the bigger and more

moderate left-wing party SDP does seem to increase the likelihood of government-

initiated referendums (p<0.01). Therefore, the second hypothesis can be at least partly

confirmed. The share of seats of the other leftist party (VAS), on the other hand, is not

a statistically significant predictor.

                                                                                                               10 Yes/no initiative, yes/no referendum. 11 The data were compiled from Statistics Finland official election statistics. 12 The data were compiled from Statistics Finland official demographic statistics.

  14  

The non-significance of the fifth independent variable – the use of citizens’ initiative

– is an interesting result, as well. Considering the existing legislation of the citizens’

initiative and also their increased use during 1991-2012, one could have assumed that

they explained the use of referendums at least to some extent.

Table 3. Party system determinants of the use of referendums (binary logistic regression)

B S.E. Wald Sig. Exp(B) 95% C.I.for EXP(B)

Lower Upper

Proportion of seats, SDP .046 .014 10.806 .001 1.048 1.019 1.077

Proportion of seats, Green party .063 .044 2.031 .154 1.065 .977 1.160

Proportion of seats; VAS -.006 .019 .086 .770 .994 .958 1.032

Effective number of parties -.282 .220 1.646 .200 .754 .490 1.161

Use of citizens’ initiative -.702 .430 2.662 .103 .496 .213 1.152

Nagelkerke

-2 Log likelihood

Chi-square (Omnibus tests)

N

.079

288.45

15.744 (p<.05)

308

When population, geographical location and turnout in the last local elections are

added into the model in table 4., it is able to explain slightly more of the variation in

the use of municipal referendums (Nagelkerke = 0.091). The control variables do not

turn out to be statistically significant predictors of the use of referendums. However,

when more predictors are included, the share of seats of the Green party almost

becomes statistically significant (p<0.1). The moderate left-wing party SDP also

remains as a significant predictor of the referendum use. Although statistically

insignificant, the regression coefficient for population size indicates that smaller

municipalities are more likely to have referendums than municipalities with large

population. Adding the control variables did not, however, improve the model fit

(Chi-square 2.38, 3 degrees of freedom, p>0.05).

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Table 4. Party system, demographic and other determinants of the use of referendums (binary logistic regression)

B S.E. Wald Sig. Exp(B) 95% C.I.for EXP(B)

Lower Upper

Proportion of seats, SDP .050 .015 11.462 .001 1.051 1.021 1.082

Proportion of seats, Green party

.082 .047 3.128 .077 1.086 .991 1.190

Proportion of seats, VAS -.004 .020 .031 .860 .996 .957 1.037

Effective number of parties -.206 .244 .713 .398 .813 .504 1.314

Use of citizens’ initiative -.596 .439 1.847 .174 .551 .233 1.302

Population -.190 .158 1.450 .228 .827 .606 1.127

Region -.010 .031 .101 .751 .990 .932 1.052

Turnout in local elections .004 .023 .032 .857 1.004 .961 1.049

Nagelkerke

-2 Log likelihood

Chi-square (Omnibus tests)

N

.091

286.07

18.121 (p<.01)

308

The results of the logistic regressions for the use of referendum initiatives in Finnish

municipalities are presented in the following tables 5. and 6. The model with only

particular parties’ share of votes and the effective number of parties explains again

approximately eight per cent of the variation in the occurrence of initiatives. But here,

the share of seats of the Green party seems to be a statistically significant (p<0.1)

predictor. The third hypothesis assumed that the fewer parties are included in the

council, the more policy issues are put forward with citizens’ initiatives. This

hypothesis has to be, however, rejected because the effective number of parties is not

a statistically significant predictor.

Table 5. Party system determinants of the use of citizens’ initiatives (binary logistic regression)

B S.E. Wald Sig. Exp(B) 95% C.I.for EXP(B)

Lower Upper

Proportion of seats, SDP .011 .014 .592 .442 1.011 .983 1.040

Proportion of seats, Green party

.077 .041 3.590 .058 1.080 .997 1.169

Proportion of seats, VAS .003 .019 .020 .888 1.003 .967 1.040

Effective number of parties .306 .208 2.166 .141 1.358 .903 2.042

Nagelkerke

-2 Log likelihood

Chi-square (Omnibus tests)

N

.081

285.36

15.97 (p<0.01)

308

  16  

In the second model with control variables, the fourth hypothesis concerning the

unpredictability of voter preferences gets some support from the data. As can be seen

in table 6., larger municipalities in terms of the number of inhabitants are more likely

to experience citizens’ initiatives than smaller municipalities (p<0.1). Green party’s

share of votes, on the other hand, is no longer a significant predictor.

Two other independent variables also turn out to be significant predictors in this

model. Geographical location of the municipality is significant at level 0.05 indicating

that the municipalities in the Southern Finland are more likely to experience citizens’

initiatives than those in the North. Municipalities where elections attract less people

are also more likely to experience initiatives than municipalities with high turnout

(p<0.05).

Adding the population, geographic location and turnout in the last municipal elections

did improve the model fit statistically significantly (Chi-square 12.38, degrees of

freedom 3, p<0.05). Therefore it can be concluded that, as expected, party system and

power relations play a very different role in the use of citizens’ initiatives than in

municipal referendums.

Table 6. Party system, demographic and other determinants of the use of citizens’ initiatives

B S.E. Wald Sig. Exp(B) 95% C.I.for EXP(B)

Lower Upper

Proportion of seats, SDP -.005 .016 .100 .751 .995 .965 1.026

Proportion of seats, Green party

.025 .047 .285 .594 1.026 .935 1.125

Proportion of seats, VAS .017 .021 .676 .411 1.017 .977 1.059

Effective number of parties -.039 .240 .027 .870 .961 .601 1.538

Population .283 .161 3.064 .080 1.326 .967 1.820

Region -.065 .032 4.005 .045 .937 .880 .999

Turnout in last elections -.048 .024 3.981 .046 .953 .910 .999

Nagelkerke

-2 Log likelihood

Chi-square (Omnibus tests)

N

.142

272.78

28.544 (p<0.001)

308

  17  

6. Discussion

Although some scholars argue that democratic innovations should ideally be

implemented at the national or international levels of government (Newton 2012;

Parkinson 2006), looking at the local level may give us some ideas of favorable

preconditions for the implementation and political impacts of democratic innovations

in general. In this paper it has been analyzed, how party system and some other

indicators predict the use of local government-initiated referendums and referendum

initiatives. The context of the study is a proportional electoral system, which has

adopted two instruments of local direct democracy and given them both a consultative

status.

The representative context does seem to matter for the occurrence of local direct

democratic innovations. The conclusion is in line with the results of Andersson and

Laerhoven (2007) as well as Vatter (2000). The results of this study indicate that the

presence of certain political parties in the local council determines the use of

referendums to some extent. As was expected, the more seats one of the leftist parties

had in the local councils, the more likely referendums were organized. Similarly, the

presence of the Green party seemed to have an impact. However, the proportion of the

seats of another, more extreme leftist party did not seem to be connected with the use

of referendums.

The result, that referendum initiatives did not explain the use of referendums, reflects

the so far very minor political impacts of citizens’ initiatives in Finnish local politics.

Approximately 80 per cent of the referendum results in Finnish municipalities have

been implemented by the municipal councils, and in every fifth referendum the

council’s decision has been against citizens’ opinion. However, referendum initiatives

are very often rejected by the local councils: Less than 15 per cent of the referendum

initiatives have actually led to a referendum. The data are presented in the Appendix,

and the purpose is to broaden this study to include also analyses of the impacts of

local referendums and referendum initiatives.

The occurrence of referendum initiatives seemed to be explained better with

demographic and geographic factors as well as with the level of electoral participation

than with party system determinants. Initiatives were more likely to occur in

municipalities with a large population and low electoral turnout located in the

  18  

Southern parts of Finland. The impact of election turnout could be explained by

general political passiveness in bigger cities, but it can also indicate that citizens turn

to direct democratic means in political units where other indicators of political

support – such as participation in elections – are low. The share of seats of the Green

party also seemed to predict the occurrence of citizens’ initiatives. This can be

explained by the strong correlation between population size and support for the Green

party, which has elected local politicians mainly in bigger cities. Education level of

the local electorate can also be linked to the result because the Green party

constituents are in general higher educated.

But why did the effective number of parties not explain the use of neither

referendums nor referendum initiatives? Although theories of party system

fragmentation and the motives for government-initiated referendums suggested that

the effective number of parties might explain the use of referendums and citizens’

initiatives, it did not turn out to be the case in Finnish local politics. One possible

explanation could be that in local politics, actual voting power does not necessarily

play as big role as in the decision-making of national parliaments. Especially in terms

on citizens’ initiatives, if they are considered as minority instruments, perhaps it

already makes the political outcomes more responsive if minority groups are present

in the local council, even without real decision-making power. If citizens view it this

way, then there might not be too many initiatives as long as the actual number of

political groups in the council was high. This view is also supported by some

deliberative democrats, who claim that the presence of all discourses in society is

sufficient for a legitimate democratic process, despite of the proportional size of each

group (Dryzek and Niemeyer, 2008).

What other predictors should be studied? As discussed in chapter 4, most of the direct

democratic innovations in Finnish local politics have been linked to municipal

mergers. Especially the referendum has very clearly become an instrument that is only

used to facilitate processes of forming bigger units of local government. In the results

above, the chosen predictors were able to explain more of the variation of the citizens’

initiative use than that of referendum. This could be because of the fact that

referendums are mainly used for municipal mergers, and this factor was not included

in these preliminary analyses. As a next step, a new independent variable should be

included indicating whether the municipality has merged with other municipalities

  19  

within 2-3 years from the time of the referendum or the initiative. Then it could be

studied, how strong predictor this prospect of a municipal merger is, and second, how

much of the variance if explained by other factors.

Also the independent variable concerning the geographical location of the

municipality could be replaced with other, more suitable predictors. The

unpredictability of voter preferences -hypothesis suggests that in sparsely inhabited

areas the decisions may reflect less the opinions of the citizens. In Finland, Southern

parts of the country are in general more densely populated than the Northern regions.

However, within the regions variations are huge, so the mere population density of the

municipality might be a better predictor. Also the degree of urbanization could be

used as a predictor with the reference point being the 50/50-balance of urban and rural

areas. However, these demographics often correlate with population size, and also

with each other, which can cause multicollinearity in the logistic regressions.

Finally, other methods could also be applied to explain the use of direct democratic

innovations. A qualitative analysis of local council protocols and newspapers could be

conducted to explore the salience and history of referendum and initiative issues in

each municipality. This could reveal more reliably the real motives for government-

initiated referendums as well as the origins of referendum initiatives.

In Finnish local politics, as in many other countries as well, the most popular methods

for consulting citizens have been opinion polls, issue-based permanent councils,

which have both civil servant and citizen members, and different user panels in

service production. During the last few years some municipalities have also

experimented with deliberative citizen forums, and in the on-going reform of the

municipal law it has been debated whether the use of these forums should be

encouraged in the legislation. These consultative-discursive participatory processes

(Newton, 2012) are not usually, however, linked directly to the work of local

councils. They are being used in particular sectors of government and organized by

civil servants responsible for citizen consultations. In the next stage of this research

project, the use of these consultative-discursive procedures will be mapped in 40

representatively selected municipalities and the factors facilitating their use identified.

  20  

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APPENDIX

Table 7. Categorization of referendum and initiative issues Category Issues Municipal merger Merging with municipality X

Merging in general vs. remaining independent Several different municipal structures as options

Traffic Construction of a road Construction of an underground car park Construction of a bridge

Social and health services Placing of a retirement home Entering a health cooperation treaty Abolishing a public health service enterprise

Education Preserving the existing school network Closing down local school X

Leisure activities Building an indoor swimming pool Waste and energy Placing of a nuclear power plant

Building a waste burning plant Building a water purification plant

Municipal identity Changing province / region Changing the coat of arms Changing the name of the municipality Changing the municipality form into a city

Other Marketization of a municipal energy company Confidence in the city manager Building a new housing area Cooperation treaty in public service production Selling property of the municipality

Table 8. Coding of independent variables Name of the variable Description and coding

Proportion of seats, SDP Percentage of the council seats the party has, continuous variable.

Proportion of seats, Green party Percentage of the council seats the party has, continuous variable.

Proportion of seats, VAS Percentage of the council seats the party has, continuous variable.

Effective number of parties

The number of hypothetical equal-sized parties that would have the same effect on fractionalization of the party system as have the actual parties of varying sizes, continuous variable.

Population

Number of residents in the municipality, coded into 7 categories: 1=0-2000. 2=2001-5000, 3=5001-10000, 4=10001-20000, 5=20001-50000, 6=50001-100000, 7=100001 and more

Region

In which one of the 18 regions the municipality is located. Coded 1-19 starting from the South (capital Helsinki) and ending in the North (Lapland).

Turnout in last elections The percentage of eligible voters that voted in the most recent municipal elections, continuous variable.

  24  

Table 9. The impacts of referendums

Issue

Was the council’s decision in line with the referendum result?

No Yes Total Municipal merger 11 44 55 Traffic 0 2 2 Social and health services 0 0 0 Education 0 0 0 Leisure activities 0 0 0 Waste and energy 1 0 1 Municipal identity 0 2 2 Other 0 0 0 Total 12 48 60

Table 10. The impacts of referendum initiatives

Issue Did the council decide to organize a referendum?

No Yes Total Municipal merger 20 3 23 Traffic 6 2 9 Social and health services 3 0 3 Education 8 0 8 Leisure activities 3 0 3 Waste and energy 2 1 3 Municipal identity 3 2 5 Other 5 0 5 Total 50 8 58