The Determinants of Central vs. Local Government Investment: Democracy and Development in Bolivia
ABSTRACT This chapter uses econometric models of public investment to investigate the institutional and political determinants of central vs. local government decision-making. I use a remarkable database from Bolivia’s recent, radical decentralization program. I find that local government policy decisions are progressive both economically and in terms of need, and largely determined by a competitive interest group dynamic which provides poorer citizens, as well as private sector firms and civic institutions, with political voice. This ensures that accountability is binding for elected officials. By contrast centralized investment – more insulated from grass-roots pressures – is regressive in both dimensions. The results suggest a healthy picture of local democracy in which voters are able to influence local government through both their civil institutions and the electoral mechanism. Where local government works well citizens have voice, providing an effective counterweight to the power of private firms and government’s own politico-bureaucratic interests.
- SourceAvailable from: Jean-Paul Faguet[show abstract] [hide abstract]
ABSTRACT: Does decentralization change policy outputs at the local level? If so, for better or worse? Do such changes reflect deep changes in the policy-making process itself, or are they related to technical parameters in the flow of funds? Why do some local governments respond well to decentralization while others respond badly? These are some of the most important questions surrounding the issue of decentralization, which remain open despite a large related literature. This chapter seeks to answer some of these questions for the remarkable case of Bolivia, through a blend of econometric analysis at the national level and detailed qualitative research into local political and institutional processes. I argue that the “outputs” of decentralization are simply the aggregate of local-level political and institutional dynamics, and so to understand decentralization we must first understand how local government works. Hence this chapter examines what decentralization did at the national level, and then digs down into local government processes to understand how it did it.06/2006: pages 125-152; , ISBN: 10 0262524546
THE DETERMINANTS OF CENTRAL vs. LOCAL GOVERNMENT
INVESTMENT: DEMOCRACY AND DEVELOPMENT IN BOLIVIA1
25 April 2008
1 I am grateful to Tim Besley, Teddy Brett and Gunnar Eskeland for invaluable advice and
encouragement. I also wish to thank Roli Asthana, Shanta Devarajan, Markus Haacker, James Putzel,
Chris Scott, James Snyder, Nick Stern, Howard White and seminar participants at DESTIN, the IDB,
World Bank and LACEA99 conference for their thoughtful comments and suggestions. The research in
this paper was financed by a grant from the World Bank Research Committee. An ORS award and
additional financial support were kindly provided by the ESRC. All remaining errors are my own.
2 Lecturer in the Political Economy of Development, Development Studies Institute and Centre for
Economic Performance, London School of Economics, Houghton Street, London WC2A 2AE,
+44(20)7955-6435, 7955-6844 (f), firstname.lastname@example.org
Over the past few decades decentralization has become one of the most debated policy issues
throughout both developing and developed worlds. It is seen as central to the development efforts of
countries as far afield as Chile, China, Guatemala and Nepal. And in the multiple guises of subsidiarity,
devolution and federalism it is also squarely in the foreground of policy discourse in the US, UK and EU.
But surprisingly, there is little agreement concerning the effects of decentralization in the empirical literature.
Advocates (e.g. Ostrom et.al. 1993, Putnam 1993, World Bank 1994a, UNDP 1993) argue that
decentralization can make government more responsive to the governed by “tailoring levels of consumption
to the preferences of smaller, more homogeneous groups” (Wallis and Oates 1988, 5). Opponents (e.g.
Crook and Sverrisson 1999, Samoff 1990, Smith 1985) dispute this, arguing that local governments are too
susceptible to elite capture, and too lacking in technical, human and financial resources, to produce a
heterogeneous range of public services that are both reasonably efficient and responsive to local demand.
But neither side is able to substantiate its arguments convincingly with empirical evidence.
The broadest surveys of decentralization experiences point to why. In their wide-ranging 1983
survey, Rondinelli, Cheema and Nellis note that decentralization has seldom, if ever, lived up to
expectations. Most developing countries implementing decentralization experienced serious administrative
problems. Although few comprehensive evaluations of the benefits and costs of decentralization efforts have
been conducted, those that were attempted indicate limited success in some countries but not others. A
decade and a half later, surveys by Piriou-Sall (1998), Manor (1999) and Smoke (2001) come to cautiously
positive conclusions, but with caveats about the strength of the evidence in decentralization’s favor. Manor
ends his study with the judgment that “while decentralization …is no panacea, it has many virtues and is
worth pursuing”, after noting that the evidence, though extensive, is still incomplete. Smoke asks whether
there is empirical justification for pursuing decentralization and finds the evidence is mixed and anecdotal.
The inconclusiveness of this literature is less surprising when we examine it more carefully.
Empirical work on decentralization can be divided into two broad groups: Qualitative (small sample) work,
and Quantitative (large sample) work. The former focus usually on a single country, or develop comparisons
between a small set of countries, relying primarily on descriptive and qualitative evidence. Although the
level of analysis is often careful, nuanced and deep, such studies tend to suffer from a low level of generality,
an excess of variables over observations – which in turn leads to a failure to control adequately for external
factors, and in the worst case a conflation of causes and effects. Examples of small sample studies include
Blanchard and Shleifer (2000), Parker (1995), Slater (1989), Treisman (1999), Weingast (1995), and World
Bank (1995). Quantitative studies, on the other hand, tend to benefit from the high degree of generality,
consistency and empirical transparency that statistical approaches provide. But they also suffer significant
problems with the measurement of often abstract concepts, data comparability across diverse countries (or
regions), and the possibility of omitted variables. Examples of large sample studies include de Mello (2000),
Estache and Sinha (1995), Fisman and Gatti (2000), Galasso and Ravallion (2000), Humplick and Moini-
Araghi (1996), Huther and Shah (1998), and Zax (1989).
Perhaps as a result of these methodological difficulties, neither side of the decentralization debate
has been able to specify a complete model of how government – central or local – works. The effects they
posit operate at the hazy margins of a governmental black box, and as a result competing claims from each
side pass each other in the fog, failing to engage or move the conversation forward. Without a clear model of
central or local government, both sides have difficulty analyzing the effects of switching from one to the
other. And as a result, neither side can triumph over the other. An exception to this inconclusiveness is
Faguet (Forthcoming), which examines the case of Bolivia and shows that decentralization did make
government more responsive to real local needs. After decentralization, municipalities invested more in
education, water & sanitation, water management and agriculture where illiteracy rates are higher, water and
sewerage connection rates lower, and malnutrition a greater risk respectively. These changes were driven by
Bolivia’s smallest, poorest, mostly rural municipalities investing newly devolved funds in their highest-
Knowing that these things happened is important. But in order to comprehend decentralization and
fully learn its lessons, we must also understand why they happened. We must unlock the black boxes of
central and local government operation in order to unravel the workings of each, and how they differ. We
need a micro-level approach that allows for complexity and nuance, examining policy outputs through the
interplay of institutions, electoral competition and lobbying activity that produces them. This paper builds on
Faguet’s work in an attempt to do that empirically for the remarkable case of Bolivia. It employs
econometric models of public investment that include a broader range of variables than have been used
before to examine the policy choices of central and local government in significant detail. By modeling
policy decisions under each regime separately, I am able to probe deeper into the political economy
mechanisms that govern outcomes in each. Ultimately the social processes in question may be so complex
and nuanced in nature as to require qualitative characterization of actors and the relationships between them
in order to be fully understood. The interesting, even provocative insights that emerge from the quantitative
approach employed here will hopefully help to spur such research.
Bolivia is a particularly interesting case for study because reform there consisted of a large change in
policy at a discrete point in time. The data available are of surprising scope and quality for a country of its
socio-economic characteristics, and include information on the political, social and civic, economic,
institutional, and administrative characteristics of all of Bolivia’s municipalities. These data beg to be
exploited. Furthermore, focusing on one country but with a data-intensive approach allows me to benefit
from the rigor and generality of econometric methodology while avoiding problems of data comparability
and controlling for external shocks, political regime, institutions, and other exogenous factors.
I define decentralization as the devolution by central (i.e. national) government of specific functions,
with all of the administrative, political and economic attributes that these entail, to democratic local (i.e.
municipal) governments which are independent of the center within a legally delimited geographic and
functional domain. The rest of the paper is organized as follows. Section 2 quickly reviews Bolivia’s
decentralization program, focusing on the changes in national resource flows that resulted. Section 3
discusses the empirical methodology, and then tests models of central and local government investment
separately, focusing on the power of political and institutional variables, as well as indicators of training and
capacity-building, to explain investment behavior under each regime. Section 4 concludes.
2. The Bolivian Decentralization Program
2.1 Popular Participation and the Decentralization Reform
On the eve of revolution, Bolivia was a poor, backward country with extreme levels of inequality,
presided over by a “typical racist state in which the non-Spanish speaking indigenous peasantry was
controlled by a small, Spanish speaking white elite, [their power] based ultimately on violence more than
consensus or any social pact” (Klein 1993, 237; my translation). The nationalist revolution of 1952, which
expropriated the “commanding heights” of the economy, land and mines, launched Bolivia on the road to
one of the most centralized state structures in the region. The government embarked upon a state-led
modernization strategy in which public corporations and regional governments initiated a concerted drive to
break down provincial fiefdoms, transform existing social relations, and create a modern, industrial, more
egalitarian society (Dunkerley 1984). To this end the President directly appointed Prefects, who in turn
designated entire regional governments and associated dependencies, forming a national chain of cascading
authority emanating from the capital.
Successive governments through the 1950s promoted the unionization of miners, laborers, peasants,
public servants and professionals into a hierarchical “peak association”, whose representatives negotiated
national policies directly with their similars from the private sector and government (Dunkerley 1984, 43).
Together these three planned the exploitation of Bolivia’s natural resources, the development of new
industries, and sectoral and regional policy in a bid to orchestrate a rapid development process from the
heights of La Paz. The intellectual trends of the 1950s-1970s – Dependencia theory, Import Substitution
Industrialization, and Developmentalism – only contributed to this tendency, as did the military governments
which overthrew elected administrations with increasing frequency from the 1960s on (Klein 1993). With
political power so little dispersed, there was little point in establishing the legal and political instruments of
local governance. As a result beyond the nine regional capitals (including La Paz) and an additional 25-30
cities, local government existed in Bolivia at best in name, as an honorary and ceremonial institution devoid
of administrative capability and starved for funds. And in most of the country it did not exist at all.
Against this background, the Bolivian decentralization reform was announced in 1994. The Law of
Popular Participation, developed almost in secret by a small number of technocrats (Tuchschneider 1997),
was announced to the nation to general surprise, followed by ridicule, followed by determined opposition of
large parts of society.3 First made public in January of that year, the law was promulgated by Congress in
April and implemented from July. The scale of the change in resource flows and political power that it
3 “Injertos Tramposos en ‘Participación Popular’”, Hoy, 19 January 1994; “La Declaratoria de Guerra del
Primer Mandatario”, La Razon, 27 January 1994; and “Arrogancia Insultante”, Presencia, 27 February
1994 are only three of the many articles which appeared in the Bolivian press documenting popular
reaction to the “Damned Law”. These are documented in Unidad de Comunicación (1995).
brought about were enormous. The core of the law consists of four points (Secretaría Nacional de
Participación Popular, 1994):
1. Resource Allocation. Funds devolved to municipalities doubled to 20 percent of all national tax
revenue. More importantly, allocation amongst municipalities switched from unsystematic, highly
political criteria to a strict per capita basis.
2. Responsibility for Public Services. Ownership of local infrastructure in education, health, irrigation,
roads, sports and culture was given to municipalities, with the concomitant responsibility to maintain,
equip and administer these facilities, and invest in new ones.
3. Oversight Committees (Comités de Vigilancia) were established to provide an alternative channel for
representing popular demand in the policy-making process. Composed of representatives from local,
grass-roots groups, these bodies propose projects and oversee municipal expenditure. Their ability to
have disbursements of Popular Participation funds suspended if they find funds are being misused or
stolen can paralyze local government, and gives them real power.
4. Municipalization. Existing municipalities were expanded to include suburbs and surrounding rural
areas, and 198 new municipalities (out of 311 in all) were created.
The change in local affairs that these measures catalyzed is immense. Before reform local
government was absent throughout the vast majority of Bolivian territory, and the broader state present at
most in the form of a military garrison, schoolhouse or health post, each reporting to its respective ministry.
After reform elected local governments accountable to local voters sprang into being throughout the land.
2.2 Descriptive Statistics
The scale of the changes caused by decentralization can be appreciated by examining the changes in
resource flows that followed. Total resources devolved from central to local governments increased by 72%.
More impressive are changes in the distribution of funds. Figure 1 shows revenue-sharing between central
and local governments for 1993, the last year prior to decentralization, and 1995, the first full year it was in
effect, for the capital and second city of each of the country’s nine departments. Before decentralization the
nine departmental capitals shared 93% of all funds devolved from the center, leaving 7% for Bolivia’s other
302 municipalities. After decentralization their shares were 38% and 62% respectively. Within-department
allocations also shifted from extreme skewing of resources (five of nine departmental capitals received 94%
or more of total departmental revenue-sharing) to greater equality. The per capita criterion resulted in a
massive shift of resources in favor of the smaller, poorer municipalities in Bolivia.
More important are changes to the composition of investment. Figure 2 shows the investment
patterns of central and local government before and after decentralization. The front row corresponds to
central government investment during 1991-3, and the rear row to local government investments during
1994-6. The differences are significant. In the years leading up to 1994 central government invested the
largest sums in transport, followed by hydrocarbons, multisectoral and energy. Together these four sectors
account for 73% of total public investment during 1991-3. But after decentralization local governments
invest most heavily in education, urban development, and water & sanitation, together accounting for 79% of
municipal investment during this period. Of the sectors accounting for roughly three-quarters of investment
in each case, central and local government have not even one in common.
With a very different allocation of resources across space and different uses of investment funds, the
evidence implies strongly that local and central government behave in fundamentally different ways. What
explains these differences?
19931995 % Change
sources: Min. of Finance, Min. of Social Communication
* 1995 totals estimated due to incomplete reporting.
ROD = Rest of Department
Figure 1: Central-Local Revenue Sharing (Bs'000)
Water & San
as % of
Figure 2: Local v. Central Government Investment
Data source: Secretariat of Public Investment and External Finance (Ministry of Finance)
3. The Determinants of Central vs. Local Government Investment
The object is to investigate the institutional, socio-political and administrative determinants of
investment decisions by both central and local government. Specific questions include: Which local
political forces are important in determining policy? How do voting and lobbying affect investment? How
do the institutions of government shape policy choices? I wish to estimate the effects of these factors on
public decisions under both central and local government, taking into account previous findings (Faguet,
Forthcoming) that local investment responds strongly to measures of need. The nature of the data allows me
to probe more deeply into the institutional and administrative characteristics of local government than one
can for the center. Data on factors such as the planning procedures, training and capacity building, and
information systems implemented by municipalities allows me to decompose their investment decisions to a
surprising degree. For obvious reasons, central government data offers no cross-sectional variation of this
nature, and hence less opportunity to pry open the black box of decision-making. The weight of analysis is
accordingly biased in favor of the periphery. I built my dataset from information kindly provided by the
Comptroller General, Economic Policy Analysis Unit (UDAPE), National Electoral Court, National
Statistics Institute, Secretariat of Popular Participation, Secretariat of Public Investment and External Finance
(Ministry of Finance), Secretariat of Rural Development and the Social Policy Analysis Unit (UDAPSO).
As far as I am aware, this is the first attempt to compile all of this data in a common format.
3.1 Empirical Approach
The economic literature on local government includes a strong strain on the demand for local public
goods and services. In a seminal contribution, Bergstrom and Goodman (1973) develop a method for
estimating individuals’ demand functions for municipal public services. They find positive income
elasticities and negative price elasticities for different types of municipal expenditures using a technique
which takes explicit account of population heterogeneity. Rubinfeld, Shapiro and Roberts (1987) build on
this to propose a maximum-likelihood estimation technique that incorporates the sorting of individuals
among communities on the basis of quality and quantity of local goods provided. They find price and
income elasticities considerably smaller than those of Bergstrom and Goodman and others. Pommerehne
and Schneider (1978) allow for differences in democratic institutions, dividing their sample of Swiss districts
into direct democracies, and representative democracies with and without referenda, and find that the median
voter model works best for direct democracies. This literature establishes a method for estimating demand
for local public services which I follow below.
Ideally public goods would be measured in quality-adjusted units of output, separated by type. But
such information is unavailable for Bolivia, and instead I measure investment inputs in the form of resources
expended on public investment projects. This approach has the advantage of using natural, non-controversial
units, and of facilitating comparisons across different sectors. I separate these flows by sector, and for each
sector estimate the model
Gm = ζSm + ηZm + εm , (1)
where Gm is aggregate investment per capita in the public good subscripted by municipality, Sm is a scalar or
vector of the existing stock of public goods of that type (variously defined) at an initial period, and Z is a
vector of socio-economic, demographic, regional, political, institutional, administrative and procedural
variables which might affect investment decisions. My use of the Z term follows Bergstrom and Goodman,
and Rubinfeld, Shapiro and Roberts within the context of the available data. In particular, no income data is
available at the municipal level in Bolivia, so I substitute several alternative indicators of income and wealth,
including for example housing size, quality and related characteristics, and type of cooking fuel. But in
comparison with previous authors I expand the scope of the Z vector to include measures of political regime
type, municipal decision-making processes, and civic institutions and organizations, allowing me to
investigate the micropolitical basis of local government decision-making.
In order to compare like with like, and smooth natural discontinuities in investment decisions,4 I
adopt a simple cross-sectional approach where investment flows are summed over the years 1992-935 for
central investment, and 1994-96 for local investment. I assume that the variables in S, the stock of public
services, as well as those in Z, are constant over the five-year period in question. I reduce the large number
of potential Z variables to a manageable and conceptually coherent set through principal component analysis.
This produces ten dimensions of Z containing thirteen principal component variables, which are summarized
in figure 3 and explained in detail in Annex 2. Equation (1) can thus be written as
4 Sectoral parameters often lead to investment being concentrated in time. For example, a municipality
that builds a hospital may have no need for additional health investments for some time thereafter.
Gm = ζSm + η1Z1m + … + η13Z13m + εm , (2)
where subscripts 1 to 13 denote the PCVs below.
Figure 3: Interpretation of PCVs
5 Civil Institutions
6 Private Sector
7 Political Disaffection/Protest
8 Training & Capacity-Building
Interpretation - Variable increases in... listed in order of
importance, where applicable (see Annex 1 for details)
Protestants, atheists (i.e. non-Catholics) and rural dwellers
Native-language speakers and rural dwellers
Wealth and income
Family size and poverty
Strength of local civil institutions and organizations
Dynamism of the local private sector
Electoral abstention, null and anti-government votes
Intensity of the local capacity-building efforts undertaken
by/for local government
IT systems - hardware and software
Audits by, reports to, and information system shared with
Robust administrative guidelines and operating
procedures, and a strong executive
Strong, activist municipal council and weak mayor
Informed project planning which follows consensual and
9 Information Technology
10 Central Government Auditing
11 Municipal Administration1
13 Project Planning
5 I reduce the sample to the period 1992-93 in order to be able to use census data as initial values of Sm
without incurring endogeneity. Extending the sample to 1991-93 does not change the results.
Following the notation of equation (2) above, I use coefficient ζ to characterize central and local
investment patterns according to need, where “need” is defined as the marginal utility arising from a
particular type of public service, N=U´(g). This is based on an assumption of the decreasing marginal utility
of a public service as the level of provision of that service increases. Hence need falls as the stock of g rises,
and vice versa. I rely on two types of information as indicators public service stocks: (1) the penetration
rates of public services in the local population, and (2) the initial per capita stock of infrastructure (before
decentralization). Examples include: (1) the literacy rate and the share of population without water or
sewerage; and (2) the number of sports facilities per capita. I consider type 1 variables truer indicators of
need, as they better capture the idea of people’s benefit from public services; type 2 variables indicate
existence more than exploitation by the local population. I use type 2 variables only when type 1 variables
are not available.
In theoretical terms, the main coefficients of interest are η5-η13, corresponding to the social, political,
institutional and procedural factors that underpin local governance. To a significant degree this vector of
variables represents competing hypotheses about how government works, and thus we do not expect all to be
significant for any given sector. Each sector also includes an interacted need-municipal training variable, to
test the theory that even where training and capacity building have no independent effect on investment, they
may affect investment indirectly via local government’s ability to perceive need.
Before moving to the results I briefly discuss two considerations which could affect the
interpretation of the results in important ways. The first is the possibility that central government investment
between 1992-3 was externally constrained, and thus its correlates reflect not central government preferences
but rather the structure of these constraints. The second is that municipal investment between 1994-6 was
externally constrained, and thus these patterns similarly reveal little about local-government preferences and
dynamics. If neither possibility holds, we may take investment decisions between 1992-3 and 1994-6 to
reflect central and local priorities subject to budget constraints. Otherwise we must account for additional
external constraints, and include them in our models. I take each consideration in turn.
(i) Central Government Discretion: As section 2 shows, any external constraints binding on central
government before decentralization would be of a sort that forced it to skew investment dramatically towards
a few, large municipalities and away from the smaller half, as well as favor transport and hydrocarbons over
health, education and water & sanitation. In Bolivia’s case such constraints would most likely come from
the multilateral agencies and bilateral and other donors on which the country depends for scarce investment
resources, and which impose numerous policy conditions as the price of aid. But careful consideration of
Bolivia’s international context during 1992-3 reveals no such pressures. Indeed, if anything international
pressures would seem to have pointed in opposite directions from those Bolivia took. By 1992 Bolivia had
ended its second structural adjustment program (ESAF) with the IMF, and begun its second Structural
Adjustment Credit (SAC) with the World Bank. The conditions upon which these were based include a
number of provisions designed to redirect public investment away from productive activities (mining and
hydrocarbons especially) and toward the social sectors (i.e. education, health and water & sanitation) (World
Bank 1991). Furthermore, a number of prominent projects undertaken by the Bolivian government at the
time, including the Emergency Social Fund (World Bank 1987), Social Investment Fund (World Bank
1993b), Education Reform Project (World Bank 1993a) and the incipient Integrated Child Development
Project (World Bank 1994b), co-financed in various combinations by the Word Bank, Inter-American
Development Bank, USAID, WHO/PAHO, GTZ, KfW, the Dutch, Swiss, Swedish, Belgian and several
other governments – that is to say, as far as Bolivia is concerned, the entire international community – sought
explicitly to redistribute investment flows toward poorer, rural areas and away from Bolivia’s cities. But
according to the data above, on neither criterion did international pressures have any effect. The fact that
investment outcomes were the exact opposite of those the international community supported forces us to
conclude that central government in Bolivia faced no binding constraints on its investment decisions during
this period. The implication for relevant donors’ aid policy, of course, is that collectively at least their
conditionality was ineffectual.
(ii) Constraints on Local Government: The question of external constraints on municipal governments
between 1994-6 is only somewhat more subtle. Legal constraints certainly did exist – after the Popular
Participation Law itself, central government passed Executive Decree 24182 which directed municipalities to
dedicate at least 25% of their resources to productive investment, 30% to social investment, and no more than
15% to operating costs. The center sought to reward municipalities that did so through additional investment
via the Social Investment Fund, Campesino Development Fund, National Environmental Fund, and the
Regional Development Fund. Were this binding, changes in national investment patterns between the two
periods would be the result of changed priorities in La Paz and not the action of local governments. But the
evidence demonstrates the opposite – the center proved too institutionally weak to enforce this decree. No
sanctions were taken against offending municipal governments, and the system of matching grants fell apart
as the Funds (all of them executive agencies) ignored requirements and continued working with
municipalities regardless of their compliance (Lea Plaza 1997). An examination of the limit on operating
costs reveals that 203 municipalities exceeded 15% in 1994, 157 did so in 1995, and 147 more in 1996.
Indeed, departmental capitals were amongst the biggest violators, and received correspondingly broad media
coverage of their finances. Smaller municipalities took notice. As for central government, we must conclude
that local governments faced no binding constraints on their investment decisions during this period.
I examine central and local investment in health, water & sanitation, education, urban development,
water management and agriculture, where results from the models below are strongest.6 We shall see that
central government coefficients are generally larger by an order of magnitude or more than local government
coefficients. This should be interpreted bearing in mind that even after decentralization the center manages
over seven times the resources that local government manages, and that it concentrated investment in a
relatively small number of municipalities. Larger coefficients should thus not be interpreted as greater
sensitivity to the factors that interest us, but rather as by-products of budgetary scale and concentration.7
Figure 2 shows that of the eight indicators of need used in three models of central government
investment, only one – the percentage of households using NGO or church-run health facilities – is
significant. Its positive sign indicates that investment increased where private (i.e. non-public8) medical
6 Results from the remaining four sectors are insignificant, as one might expect.
7 This effect is magnified for the case of civil institutions, which sprouted by the hundreds throughout
Bolivia after 1994.
8 The majority of private health facilities in Bolivia are NGO or church-operated.