Contributors

116 Pages·2000·6.57 MB·English

by  World Bank Group

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IN STITUTE
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Jessica Seddoni WBI Worknl Papers
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DECENTRALIZATION
BRIEFINGN OTES
Edited by
JennieL itvack
and
JessicaS eddon
Contributors
JunaidA hmad, HarryB lair,T alibE smail,J amesF ord,
Bert Hoffman, GrahamK err,E lizabethk :ing, Riitta-
LiissaK olehmainen-AitkenE,r nstL utz,K eithM cLean,
DennisR ondinelliD, avidS ewell,A nwar ShahG, iulio
De Tommasoa, nd DanaW eist
World BankI nstitute
WashingtonD, .C.
Copyright © 1999
The International Bank for Reconstruction
and Development/The World Bank
1818H Street, N.W.
Washington, D.C. 20433,U .S.A.
The World Bank enjoys copyright under protocol 2 of the Universal Copyright Convention. This
material may nonetheless be copied for research, educational, or scholarly purposes only in the
member countries of The World Bank. Material in this series is subject to revision. The findings,
interpretations, and conclusions expressed in this document are entirely those of the author(s) and
should not be attributed in any manner to the World Bank, to its affiliated organizations, or the
members of its Board of Executive Directors or the countries they represent.
Contents
Foreword.. ............................................... v
Acknowledgment.s.. .............................................. vii
Contributor..s. .............................................. ix
1. Whata ndW hy. ................................................ 1
WhatI s Decentralizatio.n..?.. ............................................. 2
DennisR ondinelli
Rationalfeo r Decentralizati.o..n.. ............................................. 6
JamesF ord
2. ProjecDt esignP: oliticalF, iscala, ndA dministrativDe ecentralizatio..n.. ........9.
ConstitutionaLl,e gala, nd RegulatoFryr amewofrok r Decentralizatio..n.. .....1 1
JamesF ord
ParticipationC,i vilS ocietya, ndD ecentralizati.o..n.. ...............................1..5....
JessicaS eddon
ExpenditurAes signmen..t. .............................................. 19
Anwar Shah
Issuesin TaxA ssignmen..t. .............................................. 23
Anwar Shah
IntergovernmenTtaral nsferasn dG rants.. .............................................2..7
Anwar Shah
DecentralizinBgo rrowingP owers.. .................... ...........................3 2
JunaidAhmad
CivilS erviceR eforma ndD ecentralizatio..n.. ........................................3..9...
JessicaS eddon and Gtulio De Tommaso
Informationa ndM onitoringin DecentralizeSdy stem..s.. .........................4..3..
DanaW eist
LocaTl echnicaal ndM anageriCala pacit.y.. ...........................................4..5.
GrahamK err
3. ServiceD eliver.y.. .............................................. 51
Decentralizatioonf t he EducationS ector.. ...........................................5..2..
Keith McLeana nd ElizabethK ing
Decentralizatioonf t he HealthS ector. ..................................... ........... 57
Riitta-LiissKao lehmainen-Aitken
Decentralizatioann d SafetyN ets. ................... ............................. 62
Jennie Litvack
Decentralizatioonf Infrastructu.r.e.. ................. ............................6 6
JessicaS eddon
Decentralizatioonf theW ateSr upply. ..................................... ........... 72
KeithM cLean
NaturaRl esourceMsa nagemeannt dD ecentralizatio..n.. ..........................7..7..
ErnstL utza nd Talib Esmail
jjjI
DecentralizatioBnri efingN otes
4. PotentiaIlm pactso f Decentralizatio..n.. ..............................................8..3
Equitya ndM ultileveledG overnmen..t. ...............................................8..3
David Sewell
MacroeconomiIcm pacto f Decentralizatio..n.. .....................................8..9.....
Bert Hoffman
Decentralizatioann dE conomicG rowth. ............................................9..3.....
JessicaS eddon
AccountabilityT, ransparencayn,d C orruptionin DecentralizeSdy stems. ..9. 6
HanyB lair
Boxes
2.1 Principleasn d BettePr racticeisn GrantD esign.. ...................................3..0.....
2.2 Criteriafo rt he Designo f IntergovernmenFtaisl caAl rrangemen.t.s. ....... ....3..1
2.3 Evolutiono f CapitalM arketsa nd Decentralizationo f BorrowingP owers. ... 35
3.1 AlternativWe aysto Produceo r ProvideL ocaPl ublicS ervices.. ........ .......6..7.
Tables
2.1 A RepresentatiAves signmenotf ExpenditurRe esponsibilitie..s.. ...... .......2..1.
3.1 MainE ffectso f Decentralizatioonn RoadsE, lectricitya,n dW aterS upply.. . 71
3.2 Divisiono f Responsibilitiebse tweenA gencya ndW aterU sers.. ........ .......7..5
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Foreword
Decentralization, a set of policies that encompasses fiscal, political, and adminis-
trative changes, can impact virtually all aspects of development. The structure of
intergovernmental relations affects everything from the efficiency and equity of
service delivery, the social safety net, and poverty alleviation programs to the de-
velopment of the financial sector and macroeconomics tability.T he division of power
and responsibility between levels of govenmmenta lso raises issues of institutional
capacity, as well as corruption and governance. Unfortunately, the far-reaching
implications of decentralization are often overlooked, as the literature and spe-
cialists tend to focus on specific dimensions. Top policymakers in decentraliz-
ing countries are often the only ones who address the full range of issues.
The notes in this volume are designed to highlight the broad range of issues
that need to be considered with regard to decentralization. They are intended to
provide brief overviews of the many different aspects of decentralization and sum-
marize key issues that need to be considered by practitioners. The notes were pre-
pared originally for a World Bank intemal web site to help Bank staff understand
the multidimensional aspects of decentralization. Each note is not meant to ad-
dress its topic in great depth, but rather to help readers consider which questions to
ask in their countries. Most importantly, by bringing these individual notes together
in this volume, readers are encouraged to consider the cross-cutting nature of de-
centralization and the importance of a comprehensive approach.
A key lesson emerging from this approach is that the impact of decentralization
will depend greatly on the many factors related to design. Simply put, with decen-
tralization, as with many complicated policy issues, the "devil is in the details."
The outcome will depend on myriad individual political, fiscal, and administrative
policies and institutions as well as their interaction within a given country.'
The volume is divided into four chapters. The first chapter, What and Why, pro-
vides an overview and explains the multidimensional nature as well as the ratio-
nale for decentralization. It also sets the stage for understanding that the impact of
decentralization will depend greatly on many specific policy and institutional is-
sues described in the second chapter, ProjectD esign:P olitical,F iscal,a nd Administra-
tive DecentralizationT. his chapter addresses key political factors (the constitutional,
legal, and regulatory framework and local participation), fiscal dimensions (ex-,
penditure assignment, tax assignment, intergovernmental transfers, and subnational
borrowing), and administrative considerations (civil service reform, information
and monitoring, and local technical and managerial capacity. The third chapter,
1. Fora comprehensived iscussiono ft hese issuesa nd their impacti n developingc oun-
tries,s ee JennieL itvack,J unaidA hmad,a nd RichardB ird," RethinkingD ecentralizationin
DevelopingC ountries,"S ectorS tudiesS eries,P REMW, orldB ank,1 998.
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DecentralizatiBonri efingN otes
ServiceD elivery,f ocuses on issues pertaining to decentralization of specific sectors
and the delivery of different services (education, health care, safety nets, infrastruc-
ture, water, natural resources management). Finally, the fourth chapter, Potential
Impactso f Decentralizationd, iscusses potential impacts on equity objectives,m acro-
economic stability, growth, and accountability and corruption.
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Acknowledgments
This volume is a collective effort of the World Bank's Decentralization Thematic
Group. The notes that make up the volume were drafted, reviewed, and edited by
many insightful, experienced people.
We appreciate the contributions of Richard Bird and Keith McLean, who re-
viewed and contributed to the editing of several of the notes. In addition, the fol-
lowing individuals reviewed at least one of the notes: Harold Alderman, William
Ascher, Naazneen Barma, Joel Brakan, Greg Browder, Robert Ebel, Peter Fallon,
Ariel Fiszbein, Sandra Giltner, Graham Kerr, Christine Kessides, Deepa Narayan,
Barbara Nunberg, Jesse Ribot, Dennis Rondinelli, Eluned Schweitzer, David Sewell,
Dominique van de Walle, and Debbie Wetzel.
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