This article looks at the vertical distribution of power within Indonesia's new institutional framework. The main argument is that the devolution of state power has been a protracted bargaining process between centralistic and local forces. Withthe absence of a strong rule of law, the legal framework was often abused by alliances of politicians, bureaucrats and private actors for rent-seeking
... [Show full abstract] activities. Moroever, the article illustrates that decentralization had a number of side effects, such as the rise of corruption and money politics, the consolidation of local oligarchies and the revival of primordialism. All in all, it has led to a severe weakening of the Indonesian state which has been used by the nationalist elite to slow down the decentralization process.