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Making Reform Work: Institutions, Dispositions, and the Improving Health of Bangladesh
Abstract
We examine whether local governance can improve social development empirically, using good and bad cases of public health outcomes in Bangladesh. We explore the institutional underpinnings of service provision, digging down beneath the "rules of the game" to analyze the beliefs, understandings, and dispositions that drive social behavior. Changes in deep social attitudes led to improvements in social indicators. Regional variation in health outcomes is explained by the presence or absence of a dense web of relationships that enmeshed reformers in local systems of authority and legitimacy, strengthening their actions and making local society more susceptible to change.
... Similarly, multiple studies have addressed the question of whether better governance helps in reducing maternal mortality. However, some of the major limitations of these studies are that they either focused on one specific dimension of governance (Manandhar et al., 2004;Faguet and Ali, 2009;Holmberg and Rothstein, 2011;Muldoon et al., 2011;More et al., 2012;Hamal et al., 2018) or conducted only cross-sectional analyses in most cases and thereby ignored changing dynamics of governance quality across countries over time (Sajedinejad et al., 2015;Ruiz-Cantero et al., 2019). Some of them were also limited in geographical scope (Manandhar et al., 2004;Faguet and Ali, 2009;More et al., 2012;Hamal et al., 2018;Chimere et al., 2019) and methods (Sajedinejad et al., 2015;Bishai et al., 2016;Kim and Wang, 2019), and therefore, could not identify the pathways critical for effective designing of channels to act on reduction of MMR (Ciccone et al., 2014;Hall et al., 2021). ...
... However, some of the major limitations of these studies are that they either focused on one specific dimension of governance (Manandhar et al., 2004;Faguet and Ali, 2009;Holmberg and Rothstein, 2011;Muldoon et al., 2011;More et al., 2012;Hamal et al., 2018) or conducted only cross-sectional analyses in most cases and thereby ignored changing dynamics of governance quality across countries over time (Sajedinejad et al., 2015;Ruiz-Cantero et al., 2019). Some of them were also limited in geographical scope (Manandhar et al., 2004;Faguet and Ali, 2009;More et al., 2012;Hamal et al., 2018;Chimere et al., 2019) and methods (Sajedinejad et al., 2015;Bishai et al., 2016;Kim and Wang, 2019), and therefore, could not identify the pathways critical for effective designing of channels to act on reduction of MMR (Ciccone et al., 2014;Hall et al., 2021). Therefore, this study fills critical gaps by re-examining the links between the quality of governance, health expenditure and MMR drawing on cross-country panel data of 186 countries over 1996-2019 covering the transition period from MDGs to SDGs. ...
... For instance, Manandhar et al. (2004) constructed a governance indicator by looking at the impact of a community-based, participatory health intervention on MMR and found significant reductions in MMR in the rural Makwanpur district of Nepal. Another district-level study by Faguet and Ali (2009) revealed the positive impact of a decentralized health system (capturing better local governance) in reducing maternal mortality in Bangladesh. The study by More et al. (2012) found no significant effect of using community-based women groups' initiatives on maternal health outcomes in India. ...
Given change in the universal developmental agenda and the quality of governance in the last two decades, this paper re-examines the relationship between governance, health expenditure and maternal mortality using panel data for 184 countries from 1996 to 2019. By employing the 'dynamic panel data regression model', the study reveals that a one-point improvement in the governance index decreases maternal mortality by 10-21%. We also find that good governance can better translate health expenditure into improved maternal health outcomes through effective allocation and equitable distribution of available resources. These results are robust to alternative instruments, alternative dependent variables (such as infant mortality rate and life expectancy), estimation by different governance dimensions and at the sub-national level. Additional findings using 'Quantile regression' estimates show that the quality of governance matters more than the health expenditure in countries with a higher level of maternal mortality. While the 'Path regression' analysis exhibits the specific direct and indirect mechanisms through which the causal inference operates between governance and maternal mortality.
... A further dimension of the transitions is the fact that there is 'striking and persistent variation' in social indicators across regions in Bangladesh (Faguet and Ali 2009). Labour force participation rate in some districts, like Pirojpur, Chandpur, Noakhali and Laxmipur and Faridpur were less than 25% compared to national average of 36% in 2010. ...
... But while correlations are found between different indicators and the dummy variable, the latter often remains unspecified, a shorthand compressing a whole range of information of interconnected norms and practices (Kabeer 1999). Several studies have demonstrated that social forces such as religious practice and history along with geography have much to do with contemporary courses of transitions in social development factors such as accessing health services, fertility decline, etc (Faguet and Ali 2009;Amin, Basu and Stephenson 2002). This research paper is an attempt to go beyond broad regional characterizations of Sylhet and Chittagong districts with apparently similar characteristics to conduct community level analysis of two village contexts to bring out the differences between them and use them to explain differences in women's capabilities and outcomes. ...
... Regional effects are reduced when one goes further into micro-analysis to the analysis at community and household levels (Faguet and Ali 2009;Balk 1997). While region may explain a large share in the variance of a certain variable between two villages, for instance mobility, this share may be modified when the analysis is taken to the village and the household level. ...
iv List of abbreviations v
... For example, a detailed study of food for an education programme in Bangladesh by Galasso and Ravallion (2005) finds that targeting improved as the programme progressed. Faguet and Ali (2009) note that Galasso and Ravallion: 'used careful econometrics to show that pro-poor program benefits increased with decentralization' (p. 212). ...
... Much later, Shah et al. (2004), in their synthesis of empirical evidence, concluded that decentralisation has improved service delivery in some cases and in others it has worsened them. Faguet and Ali (2009), after their review, concluded that our 'lack of progress in understanding decentralisation is striking' (p. 212). ...
This article examines the effect of the decentralisation of the provision of drinking water services from one level of subnational government to a lower level of subnational government over a period of time. By using 'Difference in Difference' methodology, it compares the supply efficiency of decentralised utilities with the counterfactual - that is, the efficiency of these utilities had they not been decentralised. We use expense ratio, asset utilisation and water quality as indicators of efficiency and found that decentralisation decreases supply efficiency significantly in its immediate aftermath. We also observe that this effect is moderated over time, but the decrease in supply efficiency persists in the medium term.
... The new despotic market-based era was triggered by the 1975 murder of the national leader, Mujib, and his family, and it replaced the socialist ideology, secularism, public ownership and centrally-planned economic policy of the then Bangladeshi government by a market economy, encouraging international capital (Uddin & Hooper, 2001). The Bangladeshi economy was slowly opened to market capitalism through a privatisation policy, establishing export processing zones with restrictions on the trade unions within them, and incentives to foreign direct investment through flexible fiscal policy (Ahmed, 1989;Faguet & Ali, 2009;Quddus & Rashid, 2000;Uddin & Hooper, 2001). This, it was argued, would help the economy to develop, and capitalism to grow (Ahmed, 1989;Faguet & Ali, 2009;Quddus & Rashid, 2000;World Bank, 2006). ...
... The Bangladeshi economy was slowly opened to market capitalism through a privatisation policy, establishing export processing zones with restrictions on the trade unions within them, and incentives to foreign direct investment through flexible fiscal policy (Ahmed, 1989;Faguet & Ali, 2009;Quddus & Rashid, 2000;Uddin & Hooper, 2001). This, it was argued, would help the economy to develop, and capitalism to grow (Ahmed, 1989;Faguet & Ali, 2009;Quddus & Rashid, 2000;World Bank, 2006). However, these policies have also resulted in many adverse social and environmental impacts (Afrin, 2002;International Labour Organisation, 2002). ...
This paper explores the perceptions of Corporate Social Disclosure (CSD) in non-government organisations within the context of a developing country: Bangladesh. Many prior studies have looked at CSD practice from the managerial perspective, while providing less of an insight into non-managerial stakeholder perspectives. Several researchers have argued that the social and environmental accounting literature needs to incorporate the voice of non-managerial stakeholders in CSD development. This paper contributes to the stakeholder-perception-based CSD literature. Semi-structured interviews were carried out in selected social and environmental NGOs of both overseas and Bangladeshi origin. The results suggest that NGO executives are sceptical of current CSD practice. To them, current CSD is ad hoc and no more than a public relations exercise, lacking credibility. Most importantly, owing to structural constraints NGO executives assign lesser significance to CSD than to direct corporate involvement in social development. They described structural constraints as: high levels of poverty, weak governmental structures, dependence on foreign aid and a small group of local business people, lack of awareness of CSD, and an underdeveloped stakeholder relationship. All of these constraints are embedded within the socio-cultural and political history of Bangladesh. NGO executives believe strongly in action rather than words. They suggest that corporations need to engage in social development and to improve their social performance in order to meet their social and environmental responsibilities to the Bangladeshi people.
... What is missing from this literature is an exploration of how or why responses to P4P might vary from one place to another. Although the importance of context in health policy design generally (Balabanova, McKee, Mills, Walt, & Haines, 2010;Faguet & Ali, 2009;Roberts, Hsiao, Berman, & Reich, 2004) and for P4P in particular (Eldridge & Palmer, 2009;Ireland et al., 2011) has been emphasized in the literature, the term "context" means different things to different authors. For Roberts et al. (2004), context includes the political, economic and administrative environment. ...
... For Roberts et al. (2004), context includes the political, economic and administrative environment. But as Faguet and Ali (2009) point out one has to go deeper than this in order to understand the underlying values and social processes that affect work place motivation. Section 4 draws on social science theory to suggest a framework for understanding contextual variation in responses to P4P impacts. ...
... The new despotic market-based era was triggered by the 1975 murder of the national leader, Mujib, and his family, and it replaced the socialist ideology, secularism, public ownership and centrally-planned economic policy of the then Bangladeshi government by a market economy, encouraging international capital (Uddin & Hooper, 2001). The Bangladeshi economy was slowly opened to market capitalism through a privatisation policy, establishing export processing zones with restrictions on the trade unions within them, and incentives to foreign direct investment through flexible fiscal policy (Ahmed, 1989;Faguet & Ali, 2009;Quddus & Rashid, 2000;Uddin & Hooper, 2001). This, it was argued, would help the economy to develop, and capitalism to grow (Ahmed, 1989;Faguet & Ali, 2009;Quddus & Rashid, 2000;World Bank, 2006). ...
... The Bangladeshi economy was slowly opened to market capitalism through a privatisation policy, establishing export processing zones with restrictions on the trade unions within them, and incentives to foreign direct investment through flexible fiscal policy (Ahmed, 1989;Faguet & Ali, 2009;Quddus & Rashid, 2000;Uddin & Hooper, 2001). This, it was argued, would help the economy to develop, and capitalism to grow (Ahmed, 1989;Faguet & Ali, 2009;Quddus & Rashid, 2000;World Bank, 2006). However, these policies have also resulted in many adverse social and environmental impacts (Afrin, 2002;International Labour Organisation, 2002). ...
Although prior studies looked at corporate social disclosures (CSD hereafter) mainly from the managerial perspective there are very few studies which examined CSD from a non-managerial stakeholder perspective. This paper contributes to that limited CSD literature. It does so from a developing country perspective. The main aim of this paper is to examine the views of selected NGOs on current CSD practices in Bangladesh using Gramscian hegemonic analysis. For this purpose, semi-structured interviews were carried out in the selected social and environmental NGOs of both overseas and Bangladesh origin. The results suggest that NGOs viewed the current CSD practice as far from satisfactory. They also argued that it is mainly aimed at maintaining corporate interests of image building. The study suggests that it is not corporations to be blamed alone for production of CSD in the interests of business, it is the capitalist society that consents to such reproduction of CSD.
... See also a related and relatively more rigorous literature on charter and grant-maintained schools from the US and UK respectively e.g. Abdulkadiroglu et al. (2011) and Clark (2009) 9. See, for example, Faguet (2008), Faguet and Ali (2009), and Faguet and Sánchez (2008). ...
... By so doing, the government was taken closer to the people, hence opening many new spaces for Bangladesh's vibrant civil society to participate in local decision-making (A. M. M. S. Ali, 2004;Faguet, 2016;Faguet & Ali., 2009;Islam, 1997). ...
The concentrated development in the urban areas attracts people to migrate into cities for a better of living and consequently leading towards the root causes of many socio-economic and environmental nuisances. Moreover, the high-density urban living engines the rapid spread of contagious diseases and thereby threatening the lives of millions of people. The high rate of death and affected cases of COVID-19 in Dhaka City,Bangladesh and its nearby areas, i.e., Gazipur and Narayanganj, is the consequence of impulse centralization. History provides evidence of change in city planning due to different pandemics at different times and shaped cities. The pandemic situation due to COVID-19 gives a clear indication of the importance of activity center decentralization. Due to the growing demand for healthcare in recent days, it has become necessary to decentralize the health care facilities to the remote areas of Bangladesh, and the Government of Bangladesh has already adopted some key measures. In this context, this particular research tries to determine the mutilated amenity facilities for diversified stakeholders aiming parallel discouragement of the out-migration of skilled professionals and attracting the non-local professionals to live in rural Bangladesh. The overarching methodological approach embraces an amalgam of a two-step exploratory and descriptive research undertaking conducted prior to and during the global COVID-19 outbreak. The determinants and precedence of required services in usual setup were determined through the widely accepted qualitative and quantitative methods, i.e., Focus Group Discussion (FGD) and structured direct questionnaire surveys prior to the COVID-19 pandemic. However, recent secondary questionnaire surveys through online based snowball sampling inference changes in requirements because of emergency. The outcome of this research points out some significant policy recommendations to guide planning for emergency measures in the rural areas in developing countries like Bangladesh to ensure quick response in an emergency.
... Poor supervision and monitoring across different tiers of the health system, including lack of accountability to local authorities, can promote corruption in Bangladesh. In Rajnagar Upazila Health Complex, healthcare providers are not supervised appropriately by district supervisors, and are disconnected from district-level managers in terms of decision-making and information-sharing (Faguet and Ali, 2009). They are also disconnected from elected Union Parishad representatives. ...
The research is a systematic approached review. This is a first published working paper of a anti-corruption evidence (ACE) project entitled “Corruption, Provider Practice, Motivation & Health system Performance in Bangladesh".
... Poor supervision and monitoring across different tiers of the health system, including lack of accountability to local authorities, can promote corruption in Bangladesh. In Rajnagar Upazila Health Complex, healthcare providers are not supervised appropriately by district supervisors, and are disconnected from district-level managers in terms of decision-making and information-sharing (Faguet and Ali, 2009). They are also disconnected from elected Union Parishad representatives. ...
... Poor supervision and monitoring across different tiers of the health system, including lack of accountability to local authorities, can promote corruption in Bangladesh. In Rajnagar Upazila Health Complex, healthcare providers are not supervised appropriately by district supervisors, and are disconnected from district-level managers in terms of decision-making and information-sharing (Faguet and Ali, 2009). They are also disconnected from elected Union Parishad representatives. ...
Corruption, Provider Practice, Motivation & Health System Performance in Bangladesh,
... As many researchers have noted, "social capital" increases in Bolivia as one descends the social pyramid towards the poorest and least educated (Albó et al. 1990, Faguet 2012, Faguet and Ali 2009, Healey 1987. This is very much unlike the West, where the poorest in society tend to be atomized -beggars in the street -and social organization and trust rise with income and education. ...
... These reforms decentralized power and resources from central government to division, district, sub-district, and union levels, bringing forth a new era of decentralized government. In so doing, they took government "closer to the people", and opened many new spaces for Bangladesh's vibrant civil society to participate in local decision-making (Faguet and Ali 2009). It is nonetheless important to note that decentralization in Bangladesh falls short of the standard set in other countries, such as India, Colombia and Bolivia, in terms of both the quantity of resources, and the scope of public authority devolved. ...
I examine decentralization through the lens of the local dynamics it unleashed in Bangladesh. I argue that the national effects of decentralization are largely the sum of its local-level effects. Hence to understand decentralization we must first understand how local government works. This implies analysing not only decentralization, but also democracy, from the bottom up. I present a model of local government responsiveness as the product of political openness and substantive competition. The quality of politics, in turn, emerges endogenously as a joint product of the lobbying and political engagement of local firms/interests, and the organizational density and ability of civil society. I then test these ideas using qualitative data from Bangladesh. The evidence shows that civic organizations worked with NGOs and local governments to effect transformative change from the grassroots upwards – not just to public budgets and outputs, but to the underlying behaviours and ideas that underpin social development. In the aggregate, these effects were powerful. The result, key development indicators show, is Bangladesh leap-frogging past much wealthier India between 1990 and 2015.
... Papers in the technical efficiency theme, and specifically studies investigating school decentralization reforms, appear to have a greater number of high quality contributions. By contrast, contributions in the preference 9 See for example Faguet (2008), Ali (2009), andSánchez (2008). 28 of 30 matching category are not only fewer but also less rigorous, making the task of drawing conclusions from this group difficult. ...
We review empirical evidence on the ability of decentralization to enhance preference matching and technical efficiency in
the provision of health and education in developing countries. Many influential surveys have found that the empirical evidence
of decentralization's effects on service delivery is weak, incomplete, and often contradictory. Our own unweighted reading
of the literature concurs. However, when we organize quantitative evidence first by substantive theme, and then—crucially—by
empirical quality and the credibility of its identification strategy, clear patterns emerge. Higher-quality evidence indicates
that decentralization increases technical efficiency across a variety of public services, from student test scores to infant
mortality rates. Decentralization also improves preference matching in education, and can do so in health under certain conditions,
although there is less evidence for both. We discuss individual studies in some detail. Weighting by quality is especially
important when quantitative evidence informs policy-making. Firmer conclusions will require an increased focus on research
design, and a deeper examination into the prerequisites and mechanisms of successful reforms.
... Such carefully and consensually structured activity maps, annexed to each set of CSS guidelines, might detail the functions to be devolved respectively to the village, intermediate and district levels, and thus provide the basis on which the devolution of finances is to be patterned, matched by a parallel devolution of functionaries to each level of self-governance, in rural as much as in urban localities. 38 Such empowerment will enable the local community to deploy the financial resources made available to them (and mobilised by them) to themselves plan and implement their own programmes of grassroots development and poverty eradication instead of depending on the grudging patronage of higher-level politicians, who have their own agenda, and an indifferent, self-serving local bureaucracy: grassroots development through grassroots democracy, as appears to be happening currently in Bangladesh (Faguet and Ali 2009). ...
This chapter assesses rural local self-government (Panchayat Raj) in India. It provides an overview of the competing visions and philosophies on (local) democracy between leading figures like Gandhi, Nehru and Ambedkar, as well as the narrow interests of power-holders that have led to conflicting approaches to the development of Panchayat Raj institutions since India's independence. It asks why rapid growth has not led to more inclusive growth-why India is prospering but Indians are not-and how far the Panchayat Raj Institutions might remedy the problems of highly concentrated wealth and a wasteful bureaucracy. It argues that Panchayat Raj must be improved and strengthened in order to genuinely permit governance from below for a more effective conception and delivery of development programs and public services that match diverse and differentiated local needs, for an economic model of inclusive governance for inclusive growth, and for the fruits of growth to truly spread to all Indians in a full-fledged democracy.
... Faguet and Ali's (2009) findings from Bangladesh support the importance of voice and exit in making local government responsive.Channa and Faguet's (2012) survey of international experiments in decentralization provides evidence on the importance of electoral exit as a tool for motivating public officials. ...
... These reforms decentralized power and resources from central government to division, district, sub-district, and union levels, bringing forth a new era of decentralized government in Bangladesh. In so doing, they took government "closer to the people", and opened many new spaces for Bangladesh's vibrant civil society to participate in local decision-making (Faguet and Ali 2009). It is nonetheless important to note that decentralization in Bangladesh falls short of the standard set by Bolivia, in terms of both the quantity of resources, and the scope of public authority devolved. ...
I examine decentralization through the lens of the local dynamics it unleashed in the much-noted case of Bolivia and the less-noted case of Bangladesh. I argue that the national effects of decentralization are largely the sum of its local-level effects. Hence to understand decentralization we must first understand how local government works. This implies analysing not only decentralization, but also democracy, from the bottom up. Beginning with Bolivia, I explore the deep economic and institutional determinants of government quality in two extremes of municipal performance. From this I derive a model of local government responsiveness as the product of political openness and substantive competition. The quality of politics, in turn, emerges endogenously as a joint product of the lobbying and political engagement of local firms/interests, and the organizational density and ability of civil society. The model explains the micro-foundations of good vs. bad local government performance, and hence of Bolivia’s overall decentralization success. I then test these ideas using qualitative data from Bangladesh. The evidence shows that civic organizations worked with NGOs and local governments to effect transformative change from the grass-roots upwards – not just to public budgets and outputs, but to the underlying behaviours and ideas that underpin social development. In the aggregate, these effects were powerful. Key development indicators show Bangladesh leap-frogging past much wealthier India between 1990 and 2015. The combination of tests shows that the model generalizes to very different institutional, cultural, and economic contexts.
... In other low-income countries, decentralized expenditure has been shown to improve health outcomes (Faguet and Ali 2009). Does this hold in Ethiopia? ...
Ethiopia, like most developing countries, has opted to deliver services such as basic education, primary health care, agricultural extension advice, water, and rural roads through a highly decentralized system. That choice is based on several decades of theoretical analysis examining how a decentralized government might respond better to diverse local needs and provide public goods more efficiently than a highly centralized government.
Ethiopia primarily manages the delivery of basic services at the woreda (district) level. Those services are financed predominantly through inter-governmental fiscal transfers (IGFTs) from the federal to the regional and then the woreda administrations, although some woredas raise a small amount of revenue to support local services. Since 2006, development partners and the government have co-financed block grants for decentralized services through the Promoting Basic Services (PBS) Program. Aside from funding the delivery of services, the program supports measures to improve the quality of services and local governments’ capacity to deliver them by strengthening accountability and citizen voice.
Ethiopia’s model for delivering basic services appears to be succeeding and to confirm that services improve when service providers are more accountable to citizens. As discussed in the World Development Report 2004, accountability for delivering basic services can take an indirect, long route, in which citizens influence service providers through government, or a more direct, short route between service providers and citizens. When the long, indirect route of accountability is ineffective, service delivery can suffer, especially among poor or marginalized citizens who find it challenging to express their views to policymakers.
In Ethiopia, the indirect route of accountability works well precisely because of decentralization. Service providers are strictly accountable to local governments for producing results, but in turn, the local authorities are held accountable by the regional and federal governments. A degree of local competition for power and influence helps to induce local authorities and service provides to remain open to feedback from citizens and take responsibility for results. The direct route of accountability has been reinforced by measures to strengthen financial transparency and accountability (educating citizens on local budgets and publicly providing information on budgets and service delivery goals), social accountability (improving citizens’ opportunities to provide feedback directly to local administrators and service providers), and impartial procedures to redress grievances (instituting the independent Ethiopian Institution of the Ombudsman, for example).
Woreda-level spending, financed through IGFTs and supported by the PBS Program, has been a very effective strategy for Ethiopia to attain its Millennium Development Goals (MDGs). Spending on health and education accounts for 80 percent of PBS-financed spending by the woredas, which goes to pay for health extension workers (HEWs) and teachers. Although the link between numbers of personnel hired and services delivered must be treated with caution (and is being explored in detail in another study), this study finds evidence that woreda-level spending in health and education is effective.
Owing to the intervention of HEWs, the use of health services has increased, especially among the poorest quintiles. Every additional US$ 1 of per capita spending by the woredas on health is associated with a 6.4 percent increase in the contraceptive prevalence rate and an 11.3 percent increase in deliveries by skilled birth attendants (two interventions that can reduce maternal mortality dramatically), as well as a 3.6 percent increase in antenatal care (which can reduce infant and child mortality significantly). For education, an increase of US$ 1 per capita in spending by each woreda is associated with a 3.6 percent increase in the net primary enrollment rate within that woreda. Similar results are seen for the pupil-teacher ratio.
Finally, the effect of woreda-level spending on agricultural extension workers is associated with higher yields for major crops, including cereals, vegetables, enset, coffee, and fruit. Spending on agricultural extension workers increases the probability that farmers, regardless of the size of their plots, will use improved farming techniques.
Education, health, and agriculture account for 97 percent of woreda spending, which in turn constitutes 97 percent of PBS-financed IGFTs. This is complemented by support for greater engagement among citizens, improvements in local capacity to manage resources, and better access to information on national and local budgeting and development objectives. While it is difficult to provide precise estimates of the impact of the latter activities, the direction of their effect is clear: Spending efficiency is improved through better capacity, more transparency, and greater accountability to citizens.
In interpreting these results, it is important to bear in mind that the chain of causality from woreda spending to results is direct for education: Spending on teachers directly drives enrollments. For health and agriculture, on the other hand, spending at the woreda level on health and agricultural extension workers is best described as catalytic, because it increases the effectiveness of system-wide spending (federal capital investments in medical infrastructure, for example, or national research to develop improved varieties for farmers). Yet overall, these findings demonstrate the power of the PBS-financed decentralized approach for improving access to basic services, encouraging broadly shared development, and propelling Ethiopia rapidly toward the MDGs.
... This study showed that in order to understand success and failure in public service delivery, we need to dig down beneath the 'rules of the game': that is, to look beyond the organizations, institutions and informal rules and conventions that govern incentives, to examine the underlying beliefs, understandings and dispositions that drive behaviour. While the health 'hardware' Faguet and Ali (2009) argue, was the ability of 'local leaders' to promote changes in health behaviours. This was made possible because they were embedded in a dense 'web of relationships' between citizens, legal authorities and service providers that conferred on them local authority and legitimacy, making the local population more susceptible to their messages. ...
This paper examines the evidence on the forms of politics likely to promote inclusive social provisioning and enable, as opposed to constrain, improvements in service outcomes. It focuses on eight relatively successful cases of delivery in a range of country contexts and sectors (roads, agriculture, health, education) where independent evaluations demonstrate improved outcomes. The paper traces the main characteristics of the political environment for these cases, from the national political context, to the politics of sector policymaking, to the micro politics of implementation. The findings indicate that it is possible to identify connections between good performance and better outcomes at the point of delivery and the main forms of politics operating at local, sector and national levels.A number of common factors underpinning successful delivery emerge strongly but need to be tested through further research. In particular, the paper highlights the relationship between inclusive delivery and:- periods of crisis and transition;- the nature of the political settlement;- the types of calculations of political returns being made by political actors at all levels, and;- the extent to which the state derives or seeks to enhance its legitimacy through the provision of a particular service.
... In Bangladesh, Faguet and Ali (2009) attribute the variation in health sector performance and outcomes in two districts to differences in the respective districts history and geography. Specifically, in the better performing district these factors have interacted to produce a "dense web of relationships between citizens, their natural legal authorities, and service providers, that enmeshed these advances -and the reformers who drove advances forward -in local systems of authority and legitimacy" (Faguet & Ali 2009, p. 215 (2011) demonstrates that variation in the ability and willingness of Indonesian districts to introduce free basic health (and education) services is the "nature of district leadership -in particular, the nature of bupatis (district heads') strategies for maintaining and advancing their political careers" (Rosser et al 2011, p. 3). ...
This paper offers a fresh insight into the performance and reform opportunities of the formal health system of Papua New Guinea. A central tenant of this paper is that the historically imposed and continuing top-down nature of the formal health system in PNG is not capitalizing on potentially positive incentives and motivations inherent in the broad range of non-formal institutions that frame the PNG health system. The paper suggests that an enhanced understanding of these non-formal institutions may provide clues for how the formal system could be reconfigured to better align with the non-formal. The opportunity offered by this approach is to leverage the energy, motivation and legitimacy inherent in non-formal institutions to better buttress or infuse the formal health system. The paper draws on an emerging body of development thinking that recognizes that development depends on institutions that are stable, fair, legitimate and flexible enough to reflect political pressures; and that in turn, these kinds of institutions are the product of the interplay of formal and informal institutions. In particular, this theory argues it is when informal institutions are 'complementary' to formal institutions that institutions are likely to be most effective. In these situations informal institutions support the formal institution through 'filling in gaps' either by addressing contingencies not dealt with in the formal rules and/or by facilitating or creating incentives for individuals to pursue the goals of formal institutions.The paper analyses the PNG health system through the lens of this non-formal institutional framework. This analysis, based on secondary data, suggests: Historically, the formal PNG health system was introduced as part of the broader process of colonial administration which, in combination with a number of contemporary ideological forces, allowed little or no space for indigenous negotiation, contestation, or engagement on the form of the PNG health system, or the nature of care within that system. This legacy of top-down planning and delivery in the formal health services of PNG continues, in a modified form, to the present. There is a rich, vibrant matrix of local, intersecting non-formal institutions of relevance to health in PNG – non-formal institutions that are characterized by strong and deep engagement and contestation around health and illness issues. The formal health system is not optimally leveraging the motivation, energy and legitimacy inherent in these non-formal institutions. Some elements of the non-formal institutions in PNG that, prima facie would appear to be potentially complementary to health service development include: Local leadership keen to capitalize on the perceived 'modernizing' political benefits of western health services; communities seeking to locate health workers, and health facilities more broadly, within local social relationships – relationships that coincide with understood social obligations; space for local negotiation around appropriate level/form of user fees – with a considerable degree of intra-family subsidization, group based risk sharing, and exemptions for the poor a high degree of patient autonomy – with health seeking behavior influenced by a social understanding of the cause and appropriate treatment of illness; a very strong tendency to locate ill-health in ruptured social relations - which require a range of collective actions to remedy; the potential for the associational value of provider associations to provide a source of constraint on health worker behavior that is not evident from government; a vibrant (if diverse) range of traditional health systems that remain common and valued healing resorts for many Papua New Guineans, and which have shown a relative degree of openness to western healing; a rich tapestry of community and clan based organizations that are actively engaged in solving local collective action problems, including health improvement activities.The paper argues there is no blueprint for how an awareness of non-formal institutions could be incorporated into possible institutional re-design/reform of the PNG health system. However it does conclude with a number of general pointers to guide possible action. These include: The critical importance of looking beyond the façade of the formal organizational and institutional arrangements of the health sector to make visible the non-formal institutions that surround and shape the formal. The need for deeper and more meaningful structures of engagement/ involvement of the PNG populace in the form, financing, delivery and performance of the PNG health system. The need to understand better the scale, motivation and practices of local, village based private health resources. The opportunity to build more dispersed mechanisms of sector regulation – including community monitoring of services, and competition between providers based on reputation and accreditation. A more concentrated focus on how traditional and formal health services can co-exist and, over time, integrate to create new or 'hybrid' institutions. A possible larger role for provider associations as organizational actors in the planning, development, management and regulation of PNG health services than is currently the case.
Decentralization is meant to improve public services, but relatively few studies examine this question empirically. We explore the effects of decentralization on education, health and agriculture outcomes in Ethiopia using an original database covering all of the country's woredas (i.e. local governments), which will itself eventually be an important contribution of this paper. Ethiopia is an interesting case study for two big reasons: (i) It is the fastest growing country in Africa and one of the 5 fastest-growing in the world; and (ii) Since decentralizing the country has made significant progress towards its MDGs and in reducing poverty. We show that decentralization improved net enrolments in education, access to basic services in health such as antenatal care, contraception, vaccination rates, and deliveries by skilled birth attendants, and contributed to greater agricultural productivity in cereals, vegetables, enset, coffee and fruits.
Donors increasingly fund interventions to counteract inequality in developing countries, where they fear it can foment instability and undermine nation-building efforts. To succeed, aid relies on the principle of upward accountability to donors. But federalism shifts the accountability of subnational officials downward to regional and local voters. What happens when aid agencies fund anti-inequality programs in federal countries? Does federalism undermine aid? Does aid undermine federalism? Or can the political and fiscal relations that define a federal system resolve the contradiction internally? We explore this paradox via the Promotion of Basic Services program in Ethiopia, the largest donor-financed investment program in the world. Using an original panel database comprising the universe of Ethiopian woredas (districts), the study finds that horizontal (geographic) inequality decreased substantially. Donor-financed block grants to woredas increased the availability of primary education and health care services in the bottom 20 percent of woredas. Weaker evidence from household surveys suggests that vertical inequality across wealth groups (within woredas) also declined, implying that individuals from the poorest households benefit disproportionately from increasing access to, and utilization of, such services. The evidence suggests that by combining strong upward accountability over public investment with enhanced citizen engagement on local issues, Ethiopia’s federal system resolves the instrumental dissonance posed by aid-funded programs to combat inequality in a federation.
Decentralization research has become more quantitative and formal over the past two decades. But as technical rigor has increased, the focus of research has narrowed to decentralization’s effects on particular policy variables, leaving aside larger, more nuanced and complex questions of crucial importance to policymakers contemplating reform. This book seeks to return attention to issues like this that rank among policymakers’ first concerns, but are methodologically difficult to answer. We do this by marrying the insights and experience of senior policymakers involved in driving decentralization forward at the highest levels, with academics working at the forefront of the field in economics, politics, and development and policy studies. This chapter introduces the book by analyzing the following questions: Why do politicians decentralize in the first place? How can reform be made politically feasible? How can decentralization lead to improved development outcomes? Do municipalities compete amongst themselves, and what effects might this have on public policy and services? Will decentralization promote clientelism or broad-based development? And finally, will decentralization strengthen or weaken developing states? The evidence presented in the book provides a firm basis for concrete answers to all of these questions, allied to specific policy advice for aspiring reformers.
Why would any president, having spent a career achieving the pinnacle of power, willingly hand it away to others he cannot control? This is the black hole at the heart of the decentralization debate that has never been satisfyingly answered. We attempt to answer this question for the radical case of Bolivia through an extended interview with the man who decentralized Bolivia. Gonzalo Sánchez de Lozada was a principal actor in some of the most important events in Bolivia's – and indeed Latin America's – modern history. A highly improbable politician and statesman, he rose to prominence as the minister who designed the stabilization plan that defeated hyperinflation in a period of near-national collapse. He was elected president in 1993 and again in 2002. His first term saw a burst of reforms that decentralized political power and resources to municipalities, privatized the largest state enterprises, reformed education, created a public pension scheme, and reformed the executive branch of government. His second term saw rising unrest that culminated in huge demonstrations, shocking violence, and Sánchez de Lozada's overthrow/flight to the US, where he lives today. This chapter focuses on his formative experiences in government, how he came to believe in the necessity of reform, and how he carried his party and government in a startling push that decentralized Bolivia. 1 Based on interviews conducted on 31 March-1 April 2011 in Washington, DC. The authors are very grateful to Mauricio Balcázar for making the interviews possible, and to Drucilla Daley-Nelson and Susan Redgrave for interview transcriptions.
We examine how decentralization affects four key aspects of state strength: (i) Authority over territory and conflict prevention, (ii) Policy autonomy and the ability to uphold the law, (iii) Responsive, accountable service provision, and (iv) Social learning. We provide specific reform paths that should lead to strengthening in each. Decentralizing below the level of social cleavages should drain secessionist pressure by peeling away moderate citizens from radical leaders. The regional specificity of elite interests is key. If regional elites have more to lose than gain from national schism, they will not invest in politicians and conflicts that promote secession. Strong accountability mechanisms and national safeguards of minority rights can align local leaders’ incentives with citizens’, so promoting power-sharing and discouraging local capture or oppression. “Fragmentation of authority” is a mistaken inference; what decentralization really does is transform politics from top-down to bottom-up, embracing many localities and their concerns. The state moves from a simpler, brittler command structure to one based on overlapping authority and complex complementarity, where government is more robust to failure in any of its parts. Well-designed reform, focusing on services with low economies of scale, with devolved taxation and bail-outs prohibited, should increase public accountability. Lastly, by allowing citizens to become political actors in their own right, the small scale of local politics should promote social learning-by-doing, so strengthening political legitimacy, state-building, and ‘democratic suppleness’ from the grass-roots upwards.
We conducted a synthesis of peer-reviewed literature to shed light on links between governance mechanisms and health outcomes in low- and middle-income countries. Our review yielded 30 studies, highlighting four key governance mechanisms by which governance may influence health outcomes in these settings: Health system decentralization that enables responsiveness to local needs and values; health policymaking that aligns and empowers diverse stakeholders; enhanced community engagement; and strengthened social capital. Most, but not all, studies found a positive association between governance and health. Additionally, the nature of the association between governance mechanisms and health differed across studies. In some studies (N = 9), the governance effect was direct and positive, while in others (N = 5), the effect was indirect or modified by contextual factors. In still other studies (N = 4), governance was found to have a moderating effect, indicating that governance mechanisms influenced other system processes or structures that improved health. The remaining studies reported mixed findings about the association between governance and health (N = 6), no association between governance and health (N = 4), or had inconclusive results (N = 2). Further exploration is needed to fully understand the relationship between governance and health and to inform the design and delivery of evidence-based, effective governance interventions around the world.
Bolivia decentralized in an effort to deepen democracy, improve public services, and make government more accountable. Unlike many countries, Bolivia succeeded. Over the past generation, public investment shifted dramatically toward primary services and resource distribution became far more equitable, partly due to the creation of new local governments. Many municipalities responded to decentralization with transparent, accountable government, yet others suffered ineptitude, corruption, or both. Why? Jean-Paul Faguet combines broad econometric data with deep qualitative evidence to investigate the social underpinnings of governance. He shows how the interaction of civic groups and business interests determines the quality of local decision making.
In order to understand decentralization, Faguet argues, we must understand governance from the ground up. Drawing on his findings, he offers an evaluation of the potential benefits of decentralization and recommendations for structuring successful reform.
Bolivia’s 1994 Popular Participation reforms devolved political powers and resources to hundreds of municipal governments throughout the land. The country is currently implementing a further round of reforms that would grant a degree of autonomy to departmental, regional, municipal, and indigenous and rural governments. What effects might this have on public investment patterns, government responsiveness, government fiscal relations, the sustainability of public finances, and political accountability? Acknowledging from the outset that it is too soon to analyze the effects of this reform, I instead examine its main provisions in light of the insights provided by the international fiscal federalism literature, and extensive evidence on the effects of Bolivia’s 1994 reforms. By submitting the law to the dual rigors of theory and evidence, we can try to arrive at contingent predictions of its likely effects which, if not precise, are at least reasonable baselines. These in turn allow us to make recommendations for amendments and adjustments, not so much to the legal text as to the more complicated question of the implementation of reform. The deeper aim of this paper is to enrich the current debate on how decentralization can be implemented in ways that strengthen democracy and give voice to the poor.
This paper reviews the literature on the effects of fiscal decentralization on the magnitude and composition of expenditures. There is consistent evidence that vertical imbalance leads to larger general government. The evidence on the effects of balanced decentralization is mixed, depending a great deal on the sample and the fiscal federal margin in question. Theory and case studies suggest such heterogeneity in the comparative effectiveness of fiscal decentralization is due to heterogeneity in the institutional environment by which citizens gather information, register preferences, and monitor officials. Unfortunately, quantifying this institutional heterogeneity remains elusive. More troubling, there is sufficient distance between recorded expenditure and the quality of service delivery that using the former to assess the efficacy of fiscal decentralization is surely inadequate. We then review those studies which progress beyond measures of expenditures to measures of outcomes. Here too, the results of fiscal decentralization vary a great deal and the determinants of that variation remain elusive. There is thus room for clever work highlighting the conditions delivering effective monitoring thereby enabling successful fiscal decentralization.
Uganda’s ambitious decentralization program is analyzed in terms of a “Dual-Mode” system of local governance. Under a “technocratic mode,” conditional funding from the center is earmarked for particular programs but with little local participation. In contrast, the “patronage mode” is an elaborate system for local “bottom-up” planning, but with limited resources, which are largely consumed in administrative costs and political emoluments. Along with the spoils of a committee system controlling contracts and appointments, these resources provide the means for building political alliances and loyalty. In the absence of a culture of transparency and civic engagement to assure downward accountability, it remains to be seen whether decentralization can promote both efficient service delivery and local empowerment simultaneously.
Incl. graphs and abstracts in English, German, French, Spanish and Russian; bibliographical references Although equity is a desirable objective of any form of development intervention, including education, not many studies dwell upon this important area. Information on related trends is even more rare. This essay uses field-level data from Bangladesh to examine equity levels and trends in primary education, including enrolment and quality of learning, focusing on equity for different gender, urban or rural, economic and ethnic groups. The study shows that while some disparity between girls and boys has been eliminated, girls are still far behind boys in terms of learning achievement. Children belonging to poorer families and ethnic minority groups lag behind the respective dominant groups in terms of both enrolment and learning achievement. At the same time, there have been some improvements for hitherto excluded groups such as rural girls and children of the poor. These changes are attributed mainly to 'positive discriminatory' steps taken by the government and non-governmental organizations in favour of such groups. If this trend continues, Bangladesh can look forward to establishing itself as a more equitable society than it is now.
Too often, services fail poor people—in access, in quality, and in affordability. But the fact that there are striking examples where basic services such as water, sanitation, health, education, and electricity do work for poor people means that governments and citizens can do a better job of providing them. Learning from success and understanding the sources of failure, this year's World Development Report, argues that services can be improved by putting poor people at the center of service provision. How? By enabling the poor to monitor and discipline service providers, by amplifying their voice in policymaking, and by strengthening the incentives for providers to serve the poor. Freedom from illness and freedom from illiteracy are two of the most important ways poor people can escape from poverty. To achieve these goals, economic growth and financial resources are of course necessary, but they are not enough. The World Development Report provides a practical framework for making the services that contribute to human development work for poor people. With this framework, citizens, governments, and donors can take action and accelerate progress toward the common objective of poverty reduction, as specified in the Millennium Development Goals.
While many developing countries have devolved health care responsibilities to local governments in recent years, no study has examined whether decentralisation actually leads to greater health sector allocative efficiency. This paper approaches this question by modeling local government budgeting decisions under decentralisation. The model leads to conclusions not all favourable to decentralisation and produces several testable hypotheses concerning local government spending choices. For a brief empirical test of the model we look at data from Uganda. The data are of a type seldom available to researchers-actual local government budgets for the health sector in a developing country. The health budgets are disaggregated into specific types of activities based on a subjective characterisation of each activity's 'publicness'. The empirical results provide preliminary evidence that local government health planners are allocating declining proportions of their budgets to public goods activities.
Debates about the appropriate role, policies, and institutions of the state are often hampered by the lack of a definition for good government. To provide a quantifiable measure of good government, the authors develop an index for the quality of governance for a sample of 80 countries. They apply the index to the debate on the appropriate level of fiscal decentralization. In measuring the quality of governance, the authors develop indices for the government's ability to: a) Ensure political transparency and a voice for all citizens (the citizen participation index measures political freedom and political stability). b) Provide effective public services efficiently (the government orientation index measures judicial and bureaucratic efficiency and the absence of corruption). c) Promote the health and well-being of its citizens (the social development index measures human development and equitable distribution of income). d) Create a favorable climate for stable economic growth (the economic management index measures outward orientation, independence of the central bank, and an inverted debt-to-GDP ratio). In relating the index of governance quality to degree of fiscal decentralization for the 80 countries, the authors are not surprised to find a positive relationship between fiscal decentralization and quality of governance. But the strength of the correlation is surprising.
According to a theoretical model, student learning can be raised by school autonomy and parental participation through separate channels. Increased school autonomy increases the rent that can be distributed among stakeholders at the school, while institutions for parental participation (such as a school board) empowers parents to command a higher share of this surplus, for instance through student learning. With a rich cross-section data set from Argentine schools (6th and 7th grade), autonomy and participation are found to raise student test scores for a given level of inputs in a multiplicative way, consistent with the model. Autonomy has a direct effect on learning (but not for very low levels of participation), and participation affects learning only through mediation the effect of autonomy. The results are robust to a variety of robustness checks, and for sub-samples of children from poor households, children of uneducated mothers, schools with low mean family wealth, and public schools, the results are the same or stronger. It is possible that autonomy and participation are endogenously determined and that this biases the results, and the data available do not allow this to be ruled out with certainty. Plausible predictors of autonomy and participation are also plausible predictors of test scores directly, and fail tests for the over-identifying restrictions. Heuristically argued, however, the potential for correlation with unobserved variables may be limited: the data set is rich in observed variables, and autonomy and participation show very low correlation with observed variables. Subject to the caveats mentioned, the results may have relevance for decentralization in two ways. First, as decentralization moves responsibility from the center toward the province/...
The author examines the reasons developing countries are reexamining the respective roles of the private sector, civil society, and various levels of government--and considering new fiscal arrangements between national and lower levels of government. Decentralization may be particularly well-suited to developing countries, where central governments are not aswell developed as in industrial countries--because information requirements and transaction costs are lower at lower levels of government and the government can be more responsive and accountable to the citizenry. Vital to the success of decentralized decisionmaking, says the author, are: 1) A broad public consensus that decentralization is appropriate. 2) Civil service reform designed to encourage a service orientation, to discourage command-and-control governance and rent-seeking, and to prevent the central government from having a direct say in the recruitment and promotion of subnational civil servants. 3) Proper monitoring and oversight of governance. Other lessons from experience (include): 1) When there is citizen participation and transparency in decisionmaking, limited budgeting, auditing, and accounting systems at the subnational level should not be considered a barrier to decentralization. Those technical capabilities can be borrowed from higher levels of government. 2) Indonesia and Pakistan provide good examples of"asymmetric"decentralization, in which various powers can be assigned to different levels of government, depending on capacity. 3) The delinking of taxing and spending decisions leads to lack of accountability in the public sector. 4) Revenue-sharing (tax-by-tax) distorts incentives for efficient tax collection. 5) Properly structured (simple, transparent, consistent with objectives) fiscal transfers can improve government accountability. Fiscal transfers can also be used to encourage competition for the supply of public goods. In Canada and Chile, for example, Catholic schools compete with public schools for financing.
In 1998 Bangladesh began a sector wide approach (SWAp) to the extension of health care to vulnerable groups in the country. The central feature of this approach is the funding of an essential service package (ESP) emphasizing maternal care, certain communicable diseases and child health. This study examines the way in which public sector expenditures are distributed by comparing the actual beneficiaries of spending with the target groups identified by the sector strategy. It finds that while the ESP is helping to target resources at priority services, considerable barriers to access by vulnerable groups persist. The study suggests a number of issues that need to be addressed to improve the performance of the programme. First, improved targeting requires greater emphasis on the process of access to key services. Secondly, improving the efficiency of service provision at primary level is a key element to increasing access, since individual primary providers are often not ready to provide the standard of care required by the ESP approach to services. Finally, the system of financial control and management needs to be modified in order to make allocations more responsive to the priorities determined by the SWAp. Given the widespread adoption of the ESP approach to health care, the paper also suggests a wider research agenda that examines its impact in other countries and evaluates this worldwide experiment in health service prioritization.
This article introduces a collection of papers that provide empirical studies of the impacts that result from changes to established modes of governance: in particular, decentralizing the scale at which state institutions operate or the privatization of service delivery. We critically assess the claims made for “good governance” reforms in the light of these studies. Altering the scale, and the style, of governance has inevitable consequences for power structures, institutions, livelihoods, and physical landscapes. We offer a framework for analyzing these consequences, focusing on the temporal and scale dimensions of political and environmental decentralization and changes to established modes of governance.
Considers whether the Rahman government's pro-Islamic state was due to Islamic revivalism, the resurgence of fundamentalism in West Asia, or the sagging economy and restricted political activity in Bangladesh. These questions are examined, first, by delineating the steps undertaken by the Bangladesh government since 1977; second, by describing the growing activities of religious institutions and organizations; and finally, by examining the functions and programs of the Islamic-based political parties in Bangladesh. -from Authors
In recent years, debate on the state's economic role has too often devolved into diatribes against intervention. Peter Evans questions such simplistic views, offering a new vision of why state involvement works in some cases and produces disasters in others. To illustrate, he looks at how state agencies, local entrepreneurs, and transnational corporations shaped the emergence of computer industries in Brazil, India, and Korea during the seventies and eighties. Evans starts with the idea that states vary in the way they are organized and tied to society. In some nations, like Zaire, the state is predatory, ruthlessly extracting and providing nothing of value in return. In others, like Korea, it is developmental, promoting industrial transformation. In still others, like Brazil and India, it is in between, sometimes helping, sometimes hindering. Evans's years of comparative research on the successes and failures of state involvement in the process of industrialization have here been crafted into a persuasive and entertaining work, which demonstrates that successful state action requires an understanding of its own limits, a realistic relationship to the global economy, and the combination of coherent internal organization and close links to society that Evans called "embedded autonomy."
The politics of decentralisation 1 Measuring the performance of decentralisation: conceptual and methodological issues 6
Poverty reduction efforts in Malawi are currently based on the twin strategies of the Poverty Reduction Strategy Paper (PRSP) and decentralization of government. This paper seeks to provide a critical viewpoint on these macro-level processes based in micro-level investigations of rural livelihoods. The truly desperate livelihood circumstances of most rural Malawians are emphasized by qualitative and quantitative information on assets, activities and outcomes in eight villages in Dedza and Zomba districts. Poor rural Malawians confront multiple severe constraints that can only be addressed by some combination of raising agricultural productivity, diversifying farm output to reduce risk and shift toward higher value outputs, and diversifying livelihoods toward nonfarm enterprises. The paper pays particular attention to the public sector institutional environment required to facilitate and encourage the latter option, and finds that the PRSP offers little guidance in this regard. Given already existing tendencies for monetized farm and nonfarm activities to be seen more as sources of potential revenue than as engines of growth and poverty reduction, there is a real threat that fiscal decentralization to 27 new rural district assemblies will create new barriers to trade and enterprise by multiplying business licenses and commodity taxes. A hitherto little explored but potentially important contradiction between the objectives of the PRSP and the funding needs of local government is brought to the surface.
Why did modest attempts to decentralize the centrally administered Soviet system lead to its collapse, while more far-reaching decentralization in China left central political and administrative hierarchies intact? This article analyzes the disintegration of centrally planned organizations in the context of a neoinstitutional model of the breakdown of authority within hierarchies. An agency model of hierarchy is presented that incorporates the ambiguous property rights, authority relations, and risk-sharing conditions that prevailed under central planning and then persist during postcommunist transitions. This model suggests that decentralizing reforms could trigger an organizational “bank run,” prompting local agents to seize organizational assets under their control. The article also considers reputation-preserving strategies that central authorities might use to avert disintegration.
As an application of this model, the collapse of Soviet political, industrial, and state fiscal hierarchies are considered and compared with the experience of analogous sectors in China. Reforms in both states transferred significant autonomy from the center to local field agents. In the Soviet case these agents appropriated organizational assets with little interference from the center. In China, by contrast, the center preserved both its capacity for monitoring and its reputation for disciplining transgressions; and the rise of hybrid ownership forms made expropriation of state and Party assets far less attractive.
The paper tracks spatial inequality in social progress in Bangladesh as evidenced from the district-level data. It uses a multivariate framework to explore the differential pace of social progress at the spatial level. The 'instructive' outliers and deviants are identified in terms of underachievers and overachievers compared with the benchmark predicted by the level of aggregate affluence. The paper then draws upon discussions to coalesce a local contextual story about the possible reasons for such unexpected deviations from the general pattern. The paper concludes that the extent of spatial inequality in social development has decreased over the second half of the nineties although the overall level of inequality remains considerable. Policy implications are drawn for attacking spatial chronic poverty.
The principles and realities of decentralization are examined, with examples drawn from many Third World countries. The implications for democratic involvement, trade and aid are considered. -J.Yockney
Democratic decentralization and community participation often stand at the center of an agenda of “good governance” that aims to reduce corruption and increase the state’s accountability to its citizens. However, this paper suggests based on empirical studies on the Employment Assurance Scheme in rural West Bengal that the strength of upward accountability (especially to political parties) is as crucial as downward accountability to communities. When these vertical accountabilities are weak, horizontal accountability structures between local civil society and officials can mutate into networks of corruption in which “community” actors become accomplices or primary agents.
Household consumption surveys suggest that the downward trend in rural poverty indicators recorded in Uganda during the 1990s has been reversed since 2000. This paper examines the Ugandan government’s strategy to reduce rural poverty, the Plan for Modernization of Agriculture (PMA). It argues that, while there appear few better choices of “target” for the PMA than to improve incomes of the rural poor through increased agricultural productivity, emphasis on decentralization as a mechanism for poverty reduction is misplaced in the current political context of Uganda. The paper considers what alternative mechanisms might better deliver reductions in rural poverty.
Democratic local governance (DLG), now a major subtheme within the overall context of democratic development, promises that government at the local level can become more responsive to citizen desires and more effective in service delivery. Based on a six-country study sponsored by USAID (Bolivia, Honduras, India, Mali, the Philippines and Ukraine), this paper analyzes the two topics of participation and accountability, finding that both show significant potential for promoting DLG, though there seem to be important limitations on how much participation can actually deliver, and accountability covers a much wider range of activity and larger scope for DLG strategy than initially appears.
Like other sub-Saharan African countries, Tanzania is caught up in a process by which previous structural adjustment conditionalities have been replaced by the Poverty Reduction Strategy Paper (PRSP). This paper utilizes research on rural livelihoods in 10 subvillages in the country’s Morogoro region to derive policy inferences relevant to the capacity of the PRSP to deliver its promises for poverty reduction in rural areas. Research findings show that rural poverty is strongly associated with lack of land and livestock, as well as inability to secure nonfarm alternatives to diminishing farm opportunities. The rural poor encounter a public sector institutional context that is neutral or blocking rather than enabling for them to construct their own pathways out of poverty. The PRSP process needs to address disjunctures between its macro-level goals and debilitating local-level institutional contexts, if real gains in rural poverty reduction are to be realized.
Decentralization is becoming a reality in many developing countries—or at least in some regions of these countries. The actual degree to which decentralization meets its stated goals, however, appears to vary within countries, depending on the particular characteristics of the local area to which power and responsibility are devolved. Based on research in Bolivia and Mexico, this paper suggests an approach to the evaluation of the impacts of decentralization policies which recognizes intranational variation, illustrating the potential usefulness of this argument with reference to the population size of local jurisdictions.
The Novgorod region of Russia displays high levels of economic performance, trust in government, and associational activity—three common indicators of high levels of social capital. This paper traces the high level of social capital in the region to local government's efforts to promote an historical image of Novgorod as a vibrant mercantile democracy, and argues that local government policies have contributed to the rapid development of social capital in the region. The region's success shows that, even in the absence of a national consensus, local governments can do much to establish common social values and priorities for their communities.
The “Kerala model of development” has won wide international attention for its achievements in regard to social development and, to a certain extent, environmental sustainability. The “old” Kerala model, preoccupied with redistributive policies, failed, however, to induce economic development. As a result, attention is now being given to a “new” Kerala model. The new policy explicitly seeks reconciliation of social, productive and environmental objectives at the local level, and tries to develop synergies between civil society, local governmental bodies and the state government. The new Kerala model thus holds important lessons for participatory, community-based sustainable development in India and elsewhere.
Instead of assuming a zero-sum relationship between government involvement and private cooperative efforts, the five preceding articles argue for the possibility of “state-society synergy,” that active government and mobilized communities can enhance each others' developmental efforts. This article draws on these articles to explore the forms and sources of state-society synergy. I argue that synergy usually combines complementarity with embeddedness and is most easily fostered in societies characterized by egalitarian social structures ard robust, coherent state bureaucracies. I also argue, however, that synergy is constructable, even in the more adverse circumstances typical of Third World countries.
Developing country governments often delegate authority over the targeting of antipoverty programs to community organizations, while retaining control over how much goes to each community. We offer a theoretical characterization of the information structure in such programs and the interconnected behavior of the various players. Our model motivates an econometric specification for explaining distributional outcomes. Results for Bangladesh's Food-for-Education (FFE) Program indicate that within-village targeting improved with program size, lower land inequality, less remoteness, fewer shocks, and less private redistribution. There is no sign that the center took account of village attributes conducive to reaching the poor.
Decentralization has been a popular strategy for improving public service delivery, yet it has often failed to live up to its promise. Successful implementation requires the central government to develop new roles which are supportive of decentralization because local institutions generally lack the technical ability and the funds necessary to perform their new functions. Education decentralization in Chile resulted in an appropriate balance of responsibilities between the central government and local institutions. Decentralization had a mixed impact, however, on education quality. Improved monitoring and consistent financial support from the central government is needed to improve equity and raise the quality of education.
Nearly all countries worldwide are now experimenting with decentralization. Their motivations are diverse. Many countries are decentralizing because they believe this can help stimulate economic growth or reduce rural poverty, goals central government interventions have failed to achieve. Some countries see it as a way to strengthen civil society and deepen democracy. Some perceive it as a way to off-load expensive responsibilities onto lower level governments. Thus, decentralization is seen as a solution to many different kinds of problems. This report examines the origins and implications decentralization from a political economy perspective, with a focus on its promise and limitations. It explores why countries have often chosen not to decentralize, even when evidence suggests that doing so would be in the interests of the government. It seeks to explain why since the early 1980s many countries have undertaken some form of decentralization. This report also evaluates the evidence to understand where decentralization has considerable promise and where it does not. It identifies conditions needed for decentralization to succeed. It identifies the ways in which decentralization can promote rural development. And it names the goals which decentralization will probably not help achieve.
Estudio sobre la importancia de los acuerdos institucionales y los beneficios generados para el desarrollo de la región. Los autores plantean los métodos para evaluar diversos arreglos institucionales respecto a la puesta en marcha exitosa de algún proyecto. Tales planteamientos van acompañados de casos prácticos de algunas zonas de Africa, Asia y Latinoamérica.
Estudio sobre las fructíferas prácticas realizadas por los gobiernos estatales de Ceará, en el nordeste brasileño, a lo largo de los años 1987-1994, por medio de la creación emergente de puestos de trabajo en el sector público para el desarrollo de programas de salud preventiva, apoyo a la pequeña empresa, obra pública y del sector agrícola.
Demand for decentralisation of provision of public services is gaining ground in developing countries. Also, the policy advice to decentralise given by international agencies to the developing countries is turning into pressure. However, the benefits of decentralisation are not as obvious as the standard theory of fiscal federalism predicts. This article examines the effect of decentralisation of provision of drinking water in central India. The efficiency of water utilities under the control of the state government and those under the local governments is compared in terms of expense and asset utilisation. It is found that the decentralised provision of water supply is less efficient. The possible reasons for this counter intuitive result are analysed.
This paper takes a fresh look at the trade-off between centralized and decentralized provision of local public goods. The point of departure is to model a centralized system as one in which public spending is financed by general taxation, but districts can receive different levels of local public goods. In a world of benevolent governments, the disadvantages of centralization stressed in the existing literature disappear, suggesting that the case for decentralization must be driven by political economy considerations. Our political economy analysis assumes that under decentralization public goods are selected by locally elected representatives, while under a centralized system policy choices are determined by a legislature consisting of elected representatives from each district. We then study the role of taste heterogeneity, spillovers and legislative behaviour in determining the case for centralization.
I examine decentralization through the lens of the local dynamics that it unleashes. The national effects of decentralization are simply the sum of its local-level effects. Hence to understand decentralization we must first understand how local government works. This paper proposes a theory of local government as the confluence of two quasi-markets and one organizational dynamic. Good government results when these three elements - political, economic and civil - are in rough balance, and actors in one cannot distort the others. Specific types of imbalance map into specific forms of government failure. I use comparative analysis to test the theory's predictions with qualitative and quantitative evidence from Bolivia. The combined methodology provides a higher-order empirical rigor than either approach can alone. The theory proves robust.
Uganda has put in place a comprehensive framework for poverty reduction known as the poverty eradication action plan (PEAP). A subcomponent of the PEAP, the plan for the modernization of agriculture (PMA) is designed to address the goal of reducing poverty in rural areas. This paper utilizes research on rural livelihoods in three rural districts to derive policy inferences relevant to this framework. Research findings show that rural poverty is strongly associated with lack of land and livestock, as well as inability to secure nonfarm alternatives to diminishing farm opportunities. Meanwhile rural families encounter a rural taxation regime associated with fiscal decentralization that is basically inimical to the expansion of monetary opportunities in rural areas. A fundamental contradiction between the goals of PEAP/PMA and decentralized rural taxation is revealed.