Stress-Testing State Capacity in Federations: Unequal Local Implementation of Brazil’s Public Policies

The COVID-19 pandemic created a unique natural experiment to examine how state capacity operates below the national level in federative systems. In Brazil, the Aldir Blanc Law (2020–2022) transferred federal funds to 5,570 municipalities to support cultural workers and institutions, requiring each locality to design procedures, build implementation routines, and engage civil society actors. Despite identical legal mandates, deadlines, and funding rules, municipalities displayed markedly uneven results: while some fully deployed the resources, others failed to execute them. This paper investigates how variations in municipal state capacity shaped the ability of local governments to implement a federally designed cultural policy under exceptional conditions. The specialized literature suggests that attributes associated with Weberian bureaucracy tend to make policy execution more feasible. Furthermore, elements related to participation and social mobilization have contributed to strengthening subnational governments' ability to implement policies. Based on a national dataset that combines administrative records and indicators of bureaucratic, institutional, and political capacity, I estimate a logistic regression model predicting execution outcomes across municipalities. The findings show that, under identical policy and funding conditions, differences in local capacity—particularly bureaucratic structures and existing cultural governance arrangements—strongly predict execution. I argue that the Aldir Blanc Law functions as a stress test that reveals capacity asymmetries often obscured in routine policymaking, and that cultural policy provides a critical window into how federations create, amplify, or mitigate territorial inequalities in state capability. This study addresses a still underexplored gap concerning state capacities and bureaucracy, deepening the nuances of these elements and their dynamics at the municipal level. The implications extend beyond Brazil to debates on decentralization, governance, and local state capacity.