Wikipedia
Fractionalism is the government system that is the closest to a confederation but differs when the market system is a central market owned mostly by the government and very little by the people, yet the people have more control over it than the control of the government. This is possible by the fact that in fractionalism, the central government, on the federal level, is made up of several levels to ensure the utmost security for the people's government.
The whole nation is broken down into several small city-states. The national government cannot intervene in any acts that the city-state chooses to enforce unless it could weaken the unity of the country as a whole. Other than that, the national government cannot intervene unless there is an almost guaranteed economic collapse in the city state, a widespread famine or biological plague, or other state of emergencies declared by that city state. However, in the case of war, the national military can inhabit any city state without the need to ask permission of any form of state or local government.
Usage examples of "fractionalism".
He is a radical, but he lacks the usual petulance and vicious fractionalism of the breed.