Does Decentralization Increase Responsiveness to Local Needs? Evidence from Bolivia
Significant changes in public investment patterns - in both the sectoral uses of funds, and their geographic distribution - emerged after Bolivia devolved substantial resources from central agencies, to municipalities in 1994. By far the most impor...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2001/01/888084/decentralization-increase-responsiveness-local-needs-evidence-bolivia http://hdl.handle.net/10986/19723 |
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okr-10986-197232021-04-23T14:03:44Z Does Decentralization Increase Responsiveness to Local Needs? Evidence from Bolivia Faguet, Jean-Paul ACCOUNTABILITY ACCOUNTING ADMINISTRATIVE CAPABILITY ADMINISTRATIVE CAPACITY AGRICULTURE AUTHORITY BUREAUCRACY CAPITALS CENTRAL AGENCIES CENTRAL GOVERNMENT CENTRAL GOVERNMENTS CITIES CITIZENS CONSENSUS CORRUPTION COUNCILS DECENTRALIZATION DECENTRALIZATION REFORM DECONCENTRATION DEMOCRATIC REGIMES DEMOCRATIC SYSTEMS DEVELOPMENT STRATEGIES DEVELOPMENT STRATEGY DEVOLUTION DISTRICTS ECONOMIC GROWTH ECONOMIC INCENTIVES ECONOMIC PERFORMANCE ECONOMIES OF SCALE ECONOMISTS ELECTED REPRESENTATIVES EMPLOYMENT EQUILIBRIUM EXECUTIVE AGENCIES EXOGENOUS VARIABLES EXPENDITURE EXTERNALITIES FINANCIAL SUPPORT FISCAL FISCAL DECENTRALIZATION FOREIGN INVESTMENT GOVERNMENT RESOURCES INCOME INEFFICIENCY INSTITUTIONAL CAPACITY LEGISLATURES LOCAL GOVERNMENT LOCAL GOVERNMENTS MANAGERIAL EFFICIENCY MERIT GOOD MINISTRY OF FINANCE MORAL HAZARD MUNICIPAL GOVERNMENT MUNICIPAL GOVERNMENTS MUNICIPALITIES MUNICIPALITY NATIONAL TERRITORY POLICY INSTRUMENTS POLITICAL POWER POLITICIANS PRIVATE GOODS PRIVATIZATION PRIVATIZATION OF STATE PUBLIC ADMINISTRATION PUBLIC EXPENDITURE PUBLIC FUNDS PUBLIC GOOD PUBLIC GOODS PUBLIC HEALTH PUBLIC INVESTMENT PUBLIC SECTOR PUBLIC SERVICE PUBLIC SERVICE PROVISION PUBLIC SERVICES REPRESENTATIVES REVENUE SHARING REVOLUTION SEPARATION OF POWERS SOCIAL PACT SOCIAL SECTORS SOCIAL WELFARE TAX REVENUES TAXATION TRADITIONAL ECONOMIES TRANSPORT UNDERESTIMATES UPPER HOUSE URBAN DEVELOPMENT UTILITY FUNCTIONS VOTERS Significant changes in public investment patterns - in both the sectoral uses of funds, and their geographic distribution - emerged after Bolivia devolved substantial resources from central agencies, to municipalities in 1994. By far the most important determinant of these changes are objective indicators of social need (for example, education investment rises where illiteracy is higher). Indicators of institutional capacity, and social organization are less important. Empirical tests using a unique database show that investment changed significantly in education, agriculture, urban development, water management, water and sanitation, and possibly health. These results are robust, and insensitive to specification. As the smallest, poorest municipalities invested newly devolved public funds in their highest priority projects, investment showed a strong, positive relationship with need in agriculture, and the social sectors. In sectors where decentralization did not bring about changes, the central government had invested little before a994, and the local government continued to invest little afterward. These findings are consistent with a model of public investment, in which local government's superior knowledge of local needs, dominates the central government's technical, and organizational advantage in the provision of public services. 2014-08-26T20:27:33Z 2014-08-26T20:27:33Z 2001-01 http://documents.worldbank.org/curated/en/2001/01/888084/decentralization-increase-responsiveness-local-needs-evidence-bolivia http://hdl.handle.net/10986/19723 English en_US Policy Research Working Paper;No. 2516 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Latin America & Caribbean Bolivia |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
ACCOUNTABILITY ACCOUNTING ADMINISTRATIVE CAPABILITY ADMINISTRATIVE CAPACITY AGRICULTURE AUTHORITY BUREAUCRACY CAPITALS CENTRAL AGENCIES CENTRAL GOVERNMENT CENTRAL GOVERNMENTS CITIES CITIZENS CONSENSUS CORRUPTION COUNCILS DECENTRALIZATION DECENTRALIZATION REFORM DECONCENTRATION DEMOCRATIC REGIMES DEMOCRATIC SYSTEMS DEVELOPMENT STRATEGIES DEVELOPMENT STRATEGY DEVOLUTION DISTRICTS ECONOMIC GROWTH ECONOMIC INCENTIVES ECONOMIC PERFORMANCE ECONOMIES OF SCALE ECONOMISTS ELECTED REPRESENTATIVES EMPLOYMENT EQUILIBRIUM EXECUTIVE AGENCIES EXOGENOUS VARIABLES EXPENDITURE EXTERNALITIES FINANCIAL SUPPORT FISCAL FISCAL DECENTRALIZATION FOREIGN INVESTMENT GOVERNMENT RESOURCES INCOME INEFFICIENCY INSTITUTIONAL CAPACITY LEGISLATURES LOCAL GOVERNMENT LOCAL GOVERNMENTS MANAGERIAL EFFICIENCY MERIT GOOD MINISTRY OF FINANCE MORAL HAZARD MUNICIPAL GOVERNMENT MUNICIPAL GOVERNMENTS MUNICIPALITIES MUNICIPALITY NATIONAL TERRITORY POLICY INSTRUMENTS POLITICAL POWER POLITICIANS PRIVATE GOODS PRIVATIZATION PRIVATIZATION OF STATE PUBLIC ADMINISTRATION PUBLIC EXPENDITURE PUBLIC FUNDS PUBLIC GOOD PUBLIC GOODS PUBLIC HEALTH PUBLIC INVESTMENT PUBLIC SECTOR PUBLIC SERVICE PUBLIC SERVICE PROVISION PUBLIC SERVICES REPRESENTATIVES REVENUE SHARING REVOLUTION SEPARATION OF POWERS SOCIAL PACT SOCIAL SECTORS SOCIAL WELFARE TAX REVENUES TAXATION TRADITIONAL ECONOMIES TRANSPORT UNDERESTIMATES UPPER HOUSE URBAN DEVELOPMENT UTILITY FUNCTIONS VOTERS |
| spellingShingle |
ACCOUNTABILITY ACCOUNTING ADMINISTRATIVE CAPABILITY ADMINISTRATIVE CAPACITY AGRICULTURE AUTHORITY BUREAUCRACY CAPITALS CENTRAL AGENCIES CENTRAL GOVERNMENT CENTRAL GOVERNMENTS CITIES CITIZENS CONSENSUS CORRUPTION COUNCILS DECENTRALIZATION DECENTRALIZATION REFORM DECONCENTRATION DEMOCRATIC REGIMES DEMOCRATIC SYSTEMS DEVELOPMENT STRATEGIES DEVELOPMENT STRATEGY DEVOLUTION DISTRICTS ECONOMIC GROWTH ECONOMIC INCENTIVES ECONOMIC PERFORMANCE ECONOMIES OF SCALE ECONOMISTS ELECTED REPRESENTATIVES EMPLOYMENT EQUILIBRIUM EXECUTIVE AGENCIES EXOGENOUS VARIABLES EXPENDITURE EXTERNALITIES FINANCIAL SUPPORT FISCAL FISCAL DECENTRALIZATION FOREIGN INVESTMENT GOVERNMENT RESOURCES INCOME INEFFICIENCY INSTITUTIONAL CAPACITY LEGISLATURES LOCAL GOVERNMENT LOCAL GOVERNMENTS MANAGERIAL EFFICIENCY MERIT GOOD MINISTRY OF FINANCE MORAL HAZARD MUNICIPAL GOVERNMENT MUNICIPAL GOVERNMENTS MUNICIPALITIES MUNICIPALITY NATIONAL TERRITORY POLICY INSTRUMENTS POLITICAL POWER POLITICIANS PRIVATE GOODS PRIVATIZATION PRIVATIZATION OF STATE PUBLIC ADMINISTRATION PUBLIC EXPENDITURE PUBLIC FUNDS PUBLIC GOOD PUBLIC GOODS PUBLIC HEALTH PUBLIC INVESTMENT PUBLIC SECTOR PUBLIC SERVICE PUBLIC SERVICE PROVISION PUBLIC SERVICES REPRESENTATIVES REVENUE SHARING REVOLUTION SEPARATION OF POWERS SOCIAL PACT SOCIAL SECTORS SOCIAL WELFARE TAX REVENUES TAXATION TRADITIONAL ECONOMIES TRANSPORT UNDERESTIMATES UPPER HOUSE URBAN DEVELOPMENT UTILITY FUNCTIONS VOTERS Faguet, Jean-Paul Does Decentralization Increase Responsiveness to Local Needs? Evidence from Bolivia |
| geographic_facet |
Latin America & Caribbean Bolivia |
| relation |
Policy Research Working Paper;No. 2516 |
| description |
Significant changes in public investment
patterns - in both the sectoral uses of funds, and their
geographic distribution - emerged after Bolivia devolved
substantial resources from central agencies, to
municipalities in 1994. By far the most important
determinant of these changes are objective indicators of
social need (for example, education investment rises where
illiteracy is higher). Indicators of institutional capacity,
and social organization are less important. Empirical tests
using a unique database show that investment changed
significantly in education, agriculture, urban development,
water management, water and sanitation, and possibly health.
These results are robust, and insensitive to specification.
As the smallest, poorest municipalities invested newly
devolved public funds in their highest priority projects,
investment showed a strong, positive relationship with need
in agriculture, and the social sectors. In sectors where
decentralization did not bring about changes, the central
government had invested little before a994, and the local
government continued to invest little afterward. These
findings are consistent with a model of public investment,
in which local government's superior knowledge of local
needs, dominates the central government's technical,
and organizational advantage in the provision of public services. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Faguet, Jean-Paul |
| author_facet |
Faguet, Jean-Paul |
| author_sort |
Faguet, Jean-Paul |
| title |
Does Decentralization Increase Responsiveness to Local Needs? Evidence from Bolivia |
| title_short |
Does Decentralization Increase Responsiveness to Local Needs? Evidence from Bolivia |
| title_full |
Does Decentralization Increase Responsiveness to Local Needs? Evidence from Bolivia |
| title_fullStr |
Does Decentralization Increase Responsiveness to Local Needs? Evidence from Bolivia |
| title_full_unstemmed |
Does Decentralization Increase Responsiveness to Local Needs? Evidence from Bolivia |
| title_sort |
does decentralization increase responsiveness to local needs? evidence from bolivia |
| publisher |
World Bank, Washington, DC |
| publishDate |
2014 |
| url |
http://documents.worldbank.org/curated/en/2001/01/888084/decentralization-increase-responsiveness-local-needs-evidence-bolivia http://hdl.handle.net/10986/19723 |
| _version_ |
1764440484092051456 |