Within the divided academic literature on federalism and ethnic conflict, there is significant evidence that demonstrates that federalism is peace-conducive and promotes accommodation in diverse states (Bermeo 2002; Stepan 1999; Hechter 2000b; Lijphart 1977, 1996; Lustik, Miodownik, and Eidelson 2004; Gurr 2000). The theories regarding the inverse relationship between ethnic conflict and decentralization relate to federalism’s impact on nationalism levels. For example, it is argued that federalism provides self-governance opportunities for nations via the structural devolution of decision-making to localities, which better satisfies the demands of nations within the existing state, reducing, nationalism (Hechter 2000b:317; Kaufman 1996).
From a collective goods perspective, it is argued that federalism allows for the provision of the goods that are uniquely valued by nations, such as language education. Moreover, Bermeo (2002:99-100) argues that the additional “layers” of government inherent in a federal structure provide additional opportunities for peaceful bargaining. Similarly, in terms of collective action, Gurr (2000), Stepan (2001), and Saideman (2002) argue that decentralization provides a means to channel mobilization into forms of protest that are within politically legitimate bounds.
Also, federalism is upheld as a means to check the powers of the central government and protect minority groups from the ever-threatening “tyranny of the majority” (Riker 1964, Weingast 1998; Stepan 1999). For example, it is argued that federalism reduces grievances stemming from political discrimination because representatives in regional governments have a higher incentive to protect minority rights in order to prevent sanctions.
 This is found to be the case for both advanced industrial societies and developing societies. See Bermeo (2002:97-98).
 According to Hechter(2000b:316), since federalism “is a form of indirect rule, it ought to reduce the demand for sovereignty.” And, “since sovereignty is neither more nor less than self-governance, it follows that to the degree federation increases a nation’s self-governance, it’s demand for sovereignty must be correspondingly reduced” (Hechter (2000a) Containing Nationalism, cited in Hechter(2000b:317). Studies on specific states exemplify this dynamic, including in Spain and Belgium (Forsythe 1989), France (Savigear 1989), and Switzerland (Smith 1995, McGarry 1993), cited in Hechter (2000b:318). Also, (Bachtiger and Steiner 2004) regarding Switzerland and the case of India (Ahuja and Varshney 2005; Lijphart 1996).
 Goods valued by particular segments of the population are better provided locally than by the central government (Oates 1972, cited in Hechter 2000b:317). “Local provision of these goods is superior because it increases the likelihood that the right mix of goods will be produced-the mix that is most congruent with the distinctive values of the national group.” (Hechter 2000b:317).
 Also, federalism gives regional elites a stake in existing political institutions (Bermeo 2002:99)
 Accordingly, Hechter (2000b) finds that decentralization lessens nationalist violence, but not nationalist mobilization. Similarly, Cohen (1997), who found that federalism increases protests while reducing rebellion.
 This is also observable in the gradient-based classification scheme of federal structures derived by Stepan (1999) in which federal structures can either be demos-constraining or demos-enabling; the constraining-type federalism often provides means against the central government via traits such as a closed agenda, diffusion, self-binding constitutions, and complexity
 Especially in the case of territorially-concentrated minorities.