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The Political Economy of Decentralization Reform

Book IconTowards helping development practitioners increase their understanding of political-economy issues in decentralization reforms, the Bank’s Public Sector Anchor and the East Asia Pacific Poverty Reduction and Economic Management (PREM) Unit have jointly developed an analytical framework supported by country case studies.

The framework offers a systematic approach to conceptualizing and examining the motives that drive politicians to transfer resources and functions to lower levels of government and lead bureaucrats to support or oppose reform throughout the implementation process. The framework aims to provide input into developing more suitable and attainable service delivery and poverty reduction objectives that take into account political and institutional obstacles and opportunities.

To aid practitioners’ understanding of the broader context in which they design and implement decentralization programs, this volume points to the electoral, partisan, institutional, coalitional, and bureaucratic incentives that shape decentralization. By laying out a typology of the various impacts of decentralization and bureaucratic resistance to these, the framework shows that decentralization frequently leads to unintended consequences, particularly including changes in power dynamics and relationships. The paper demonstrates that systematic political-economy and institutional analysis can complement the more technical diagnostic and advisory work that is typically carried out by development agencies supporting decentralization programs. In addition, the framework examines how incentives can weaken, reinforce or shift in response to changes in political and economic conditions that arise after reform has begun. In order to test and demonstrate its utility, the framework has been applied to a set of country case studies that include Cambodia, the Democratic Republic of Congo, Peru, the Philippines, Vietnam, and Uganda.

To read the complete publication, click HERE.

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