The growing wave of decentralisation: Comparative evidence from developing countries

  • Blog Post Date 16 November, 2023
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Jean-Paul Faguet

London School of Economics

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Lakshmi Iyer

University of Notre Dame

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Sarmistha Pal

University of Surrey

Over the last few decades, decentralisation has been rapidly spreading in developing countries across the world, with around 35 countries announcing new or deepening decentralisation reforms in recent years. 

In a new I4I Conversation, Lakshmi Iyer (University of Notre Dame) joins Sarmistha Pal (University of Surrey) and Jean-Paul Faguet (London School of Economics), the editors of ‘Decentralised Governance: Crafting Effective Democracies Around the World’, to discuss the current global state of decentralisation. Over the conversation, they draw on theoretical and empirical insights from different chapters of the book, each featuring diverse countries – Pakistan, China, Indonesia, Kenya, India, Ghana, Bangladesh, and Colombia.

They begin with a discussion of the inherently political nature of decentralisation, and its effects on political stability and corruption. They use examples from China and Indonesia to discuss how ethnic diversity can hinder the effectiveness of decentralisation, and how it can be ameliorated. They also bring up the role that fiscal factors play in the decision to decentralise, citing the examples of Indonesia and Colombia, where decentralisation measures were undertaken after an economic crisis.

Here on, they introduce the term ‘mechanism design’, which includes a range of ‘non-political’, often technocratic criteria by which beneficiaries are identified and resources are allocated. An example of this is the use of biometric technology in India which, while being effective in verifying beneficiaries and limiting leakages in transfer programmes, has also increased the possibility of ‘recentralisation’. They also talk about other instances of fiscal recentralisation, such as in Tanzania, where revenue raising powers have moved from local units to the central government. 

Sharing their experience of editing this multi-faceted volume, they acknowledge how all the research in this volume benefits from the availability of data and local information, such as the digital birth registration records in Bangladesh or data which could be used to evaluate the local government performance in Ghana, and conclude with some thoughts on further avenues for research that they would like to see in the field of decentralisation. 

Decentralised Governance is published by LSE Press, and is free to read and download here.

Also available as a podcast.

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