Rer3ading his post, Inrealise that Walkabout may have meant some of that when he said "some local government" and therefore addressed the three levels I gave as examples. So take the UK with its four components. Or the US with its local admin, state wide rules and federal rules. These are driven by the need for an organisation higher than local and lower than world wide.

Then think about the unification of Italy. They had regional 'nations' and that was replaced by a unified nation. Which was more appropriate in your scheme.