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- Economics, Education decentralization, Decentralized education governance, Education, History, Fiscal federalism and decentralization, and 12 moreHealth Economics, Water and Sanitation, Local Government, Local Government and Local Development, Regional and Local Governance, Local Government and Regional Administration, Development Studies, Sanitation, Public Policy, Federalism and Intergovernmental Relations, Municipal Finance, and Fiscal Decentralisationedit
Analyzing the role of the local public sector in achieving sustainable development: Does more spending at the local level result in better development outcomes? An analysis of the vertical allocation of public sector resources in ten... more
Analyzing the role of the local public sector in achieving sustainable development: Does more spending at the local level result in better development outcomes? An analysis of the vertical allocation of public sector resources in ten developing countries
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The design of intergovernmental equalization transfer mechanisms, whether as the result of the introduction of a new transfer scheme or as part of the revision of an existing one, is a key element of local government finance reform around... more
The design of intergovernmental equalization transfer mechanisms, whether as the result of the introduction of a new transfer scheme or as part of the revision of an existing one, is a key element of local government finance reform around the world. While the basic elements and principles of designing intergovernmental fiscal transfer schemes apply
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Permission is granted for reproduction of this file, with attribution to the Urban Institute. The Urban Institute is a nonprofit, nonpartisan policy research and educational organization that examines the social, economic, and governance... more
Permission is granted for reproduction of this file, with attribution to the Urban Institute. The Urban Institute is a nonprofit, nonpartisan policy research and educational organization that examines the social, economic, and governance problems facing the nation. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.
Decentralization and intergovernmental finance have been a common element in international development efforts for many years. However, the success of fiscal decentralization as a development strategy is decidedly unclear, and there is... more
Decentralization and intergovernmental finance have been a common element in international development efforts for many years. However, the success of fiscal decentralization as a development strategy is decidedly unclear, and there is growing skepticism about the effectiveness of (fiscal) decentralization as an international development strategy. This short essay explores the current state of knowledge with respect to fiscal decentralization and assesses the relevance of fiscal decentralization to the wider international development agenda, using the fiscal aspects of decentralization as an entry-point into the broader discussion of decentralization. A nuanced assessment of the potential effectiveness of fiscal decentralization reform around the world requires recognition of the following facts: (1) The intergovernmental dimension of public finance is critically important for the public sector to support economic growth and deliver public services in an effective and pro-poor manne...
There is a growing recognition within the global development community that the public sector in developing and transition countries must be made to function more effectively and efficiently in the pursuit of their own development and... more
There is a growing recognition within the global development community that the public sector in developing and transition countries must be made to function more effectively and efficiently in the pursuit of their own development and poverty reduction ambitions. This cannot be done without considering the critical role of the local public sector, since most (pro-poor) public services are delivered at the local level, whether by the deconcentrated departments of line ministries or by devolved local government authorities. While the development community seeks to better understand the complex interrelations that drive the performance of decentralized political, administrative and fiscal systems, there is a dearth of relevant comparative information and data when it comes to the details of these decentralized systems, especially in developing and transition economies. This paper proposes a comparative decentralization assessment framework which guides a rapid assessment of a country’s...
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The ruling paradigm in the global development community suggests that weak public sector performance in many developing countries is caused by lack of capacity and inadequacy of resources. This assumption informs the choice of development... more
The ruling paradigm in the global development community suggests that weak public sector performance in many developing countries is caused by lack of capacity and inadequacy of resources. This assumption informs the choice of development activities supported by international development partners and international financial institutions, most notably, first, capacity building interventions and, second, the provision of external development assistance.
Many developing countries have deficiencies in their ability to manage their government expenditures in an efficient and accountable manner, so as to effectively deliver critical, pro-poor public services such as basic education, health,... more
Many developing countries have deficiencies in their ability to manage their government expenditures in an efficient and accountable manner, so as to effectively deliver critical, pro-poor public services such as basic education, health, and other public services that are essential to economic development and poverty reduction. An important — but often overlooked — element in sound public financial management is to make sure that resources flow down within the public sector to the local (subcentral) level where public services are actually delivered and where economic development takes place. Instead, public financial resources often remain stuck at the central government level, where these resources are either diverted or fund bloated and inefficient bureaucracies. While fiscal decentralization and local government finance reform have been treated as an important theme in international development and in the design of country assistance strategies for developing economies, the syst...
Cities across Asia are emerging as increasingly productive spaces driving economic growth and enabling social transformation. As their sizes and numbers grow, urban local governments’ ability to consistently deliver widely accessible and... more
Cities across Asia are emerging as increasingly productive spaces driving economic growth and enabling social transformation. As their sizes and numbers grow, urban local governments’ ability to consistently deliver widely accessible and efficiently functioning public services is key to sustaining this momentum of positive change. Better understanding the institutional constraints facing cities in doing so is therefore critical. We design and apply an assessment framework to 18 cities across 6 countries in South and Southeast Asia to better understand the functional, administrative, and political dimensions determining the quality and coverage of water, sanitation, and solid waste management services. We find that urban local governments across Asia are constrained in their authority and discretion to deliver basic public services. Reforming intergovernmental institutional structures to better match responsibilities is essential for realizing cities’ full economic potential and meet targets set in the SDGs and the New Urban Agenda.
There is an extensive literature on the impact of fiscal decentralization on economic growth, development, and public sector effectiveness. However, the empirical literature on fiscal decentralization has exclusively focused on measuring... more
There is an extensive literature on the impact of fiscal decentralization on economic growth, development, and public sector effectiveness. However, the empirical literature on fiscal decentralization has exclusively focused on measuring the finances of elected or “devolved” local governments. Other types of decentralized expenditures, including deconcentrated and delegated expenditures, have been systematically excluded from measurement and analysis in the public finance and development literature. Our analysis considers the extent to which using devolved expenditures as a proxy for all devolved expenditures may have impacted the findings of the empirical literature. We collect comprehensive vertical expenditure profiles for health and education services in twenty-nine developing and transition countries and find that by exclusively focusing on devolution, previous analyses have overlooked two-thirds of local public sector expenditures. By excluding these “nondevolved” decentralize...
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The effective and equitable delivery of primary education, basic local health services, and similar public services are critical to achieving national policy priorities and global development objectives. At the same time, the delivery of... more
The effective and equitable delivery of primary education, basic local health services, and similar public services are critical to achieving national policy priorities and global development objectives. At the same time, the delivery of these public services is fundamentally local in nature. As a result, an effective local governance system is indispensable to the localization of public services and to the achievement of sustainable development goals.
This study presents a comparative analysis of local government systems in six countries, including Cambodia (a sectorally deconcentrated system); Mozambique (a territorially deconcentrated system); Kerala, India (a mixed system, where recurrent services are delivered in a deconcentrated manner, while infrastructure development responsibilities are devolved to local governments); the Philippines (a devolved system, with some elements of deconcentration); as well as Tanzania and Indonesia (examples of devolved systems).
The comparative analysis is guided by the Local Governance Institutions Comparative Assessment (LoGICA) Framework developed by Boex and Yilmaz (2015), which provides a comparative assessment of the five main dimensions of a local governance system, including an analysis of (a) the effectiveness of the subnational governance structure and assignment of functions to the local level; (b) dynamic and responsive local political systems and leadership; (c) local control over administration and service delivery; (d) local fiscal autonomy and local financial management and (e) local participation and accountability mechanisms.
This study presents a comparative analysis of local government systems in six countries, including Cambodia (a sectorally deconcentrated system); Mozambique (a territorially deconcentrated system); Kerala, India (a mixed system, where recurrent services are delivered in a deconcentrated manner, while infrastructure development responsibilities are devolved to local governments); the Philippines (a devolved system, with some elements of deconcentration); as well as Tanzania and Indonesia (examples of devolved systems).
The comparative analysis is guided by the Local Governance Institutions Comparative Assessment (LoGICA) Framework developed by Boex and Yilmaz (2015), which provides a comparative assessment of the five main dimensions of a local governance system, including an analysis of (a) the effectiveness of the subnational governance structure and assignment of functions to the local level; (b) dynamic and responsive local political systems and leadership; (c) local control over administration and service delivery; (d) local fiscal autonomy and local financial management and (e) local participation and accountability mechanisms.
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The role of local governance within global development is approaching an important inflection point. To the extent that local governments function as effective platforms for collective local decision-making and as effective mechanisms for... more
The role of local governance within global development is approaching an important inflection point. To the extent that local governments function as effective platforms for collective local decision-making and as effective mechanisms for promoting the collective interests of their constituents, local governments are ideal partners for achieving development success. Moreover, regardless of the mechanism or type of decentralization or “localization” that is ultimately chosen, in the end, we cannot ignore the vertical governance mechanisms and multilevel service delivery mechanisms that are needed to ensure the effective delivery of public services at the local level.
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Decentralisation reforms are among the most common and significant public sector reforms, particularly in developing and transitional countries around the world. Despite the importance of the topic to policy practitioners and academic... more
Decentralisation reforms are among the most common and significant public sector reforms, particularly in developing and transitional countries around the world. Despite the importance of the topic to policy practitioners and academic researchers alike and the extensive empirical research on the topic, there is consensus in the literature that the measures of decentralisation that are currently used are unsatisfactory. In response, we propose an alternative measure of fiscal decentralisation based on the notion that decentralisation is more than simply the inverse of centralisation. Following Bahl (2005), we consider fiscal decentralisation as ‘the empowerment of people by the [fiscal] empowerment of their local governments’. Accordingly, we develop a measure of fiscal empowerment that allows us to quantify fiscal decentralisation as the gain in empowerment due to devolution and we analyse the proposed measures of empowerment and decentralisation for a cross-section of developing, transitional and industrialised countries.
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This study analyzes local health finances in Tanzania by considering the extent to which public health resources in Tanzania flow from the district government level to primary health facilities, or whether these resources get stuck at... more
This study analyzes local health finances in Tanzania by considering the extent to which public health resources in Tanzania flow from the district government level to primary health facilities, or whether these resources get stuck at the district level. Our analysis of health expenditures in six rural Local Government Authorities suggests that less than half of local health funding reaches the front-line dispensaries that provide the vast majority of local health services. The structure of the local health system appears to favor top-down interventions and control, rather than empowering local facilities to improve local health outcomes.
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This working paper provides both a conceptual and practical understanding of “how to” effectively assign functional responsibilities and authorities to different levels of local government (or to different tiers of local administration)... more
This working paper provides both a conceptual and practical understanding of “how to” effectively assign functional responsibilities and authorities to different levels of local government (or to different tiers of local administration) in the context of multilevel governance systems. In doing so, it establishes a common vocabulary in discussing functional assignment issues; reviews the concept of subsidiarity; unbundles and dissects the concept of government functions; and considers the role of decentralization as a mechanism to improve accountability and pro-poor service delivery. Consistent with the “second generation theory” of intergovernmental finance, this working paper also tries to place the vertical assignment of functions and expenditure responsibilities in a political economy context that recognizes that central and local political decision-makers do not necessarily try to maximize the well-being of their constituents; instead, the assignment of functions and responsibilities may be shaped by the personal and institutional motivatations of political and institutional decisionmakers.
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While strong arguments can be made that improved local governance and decentralization will contribute to more efficient public services and greater economic growth, this view is not universally shared within the development community. In... more
While strong arguments can be made that improved local governance and decentralization will contribute to more efficient public services and greater economic growth, this view is not universally shared within the development community. In fact, the academic research on the role of the local public sector has been unable to confirm to what extent (or under what conditions) a greater degree of decentralization results in better development outcomes. In order to fill this void in the state of knowledge, the current study engages in an empirical stock-taking exercise—based on data from 29 developing and transition countries—to assess the contribution of local governments, and the local public sector more broadly, to achieving the global development goals.
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The Constitution that Kenyans adopted in September 2010 represents an important step in the process of national reconciliation and an important attempt to make Kenya's public sector more efficient and more accountable through devolution.... more
The Constitution that Kenyans adopted in September 2010 represents an important step in the process of national reconciliation and an important attempt to make Kenya's public sector more efficient and more accountable through devolution. The new Constitution assigns a prominent role in the public sector to county-level governments, as it transfers detailed functional responsibilities to the county level and provides that at least 15 percent of national revenues are to be shared with county governments. This IDG Policy Brief discusses whether the implementation of the Constitution will bring about a sea-change in intergovernmental fiscal relations and public empowerment in Kenya, or whether the changes in Kenya's intergovernmental structure in practice will represent a smaller and more incremental step towards a more decentralized governance structure.