Does Decentralization Enhance Service Delivery and Poverty Reduction?

Does Decentralization Enhance Service Delivery and Poverty Reduction?

Studies in Fiscal Federalism and State–local Finance series

Edited by Ehtisham Ahmad and Giorgio Brosio

Does decentralization enhance service delivery and poverty reduction? Drawing on cutting edge research, expert contributors address this fundamental question facing policy-makers in developing as well as advanced countries. This timely book builds upon insights on the recent developments in the intergovernmental literature first outlined in the Handbook of Fiscal Federalism. New empirical evidence from across the globe is presented: policy-oriented chapters evaluate fiscal federalism with an emphasis on the effectiveness of decentralized service delivery, the decentralization process in different parts of the world is appraised, and specially commissioned research focuses on the political economy process and the outcomes of the decentralization process. The role of international agencies, as explicit donors, is examined in several chapters.

Chapter 2: Information Distortion, Elite Capture and Task Complexity in Decentralized Development

Jean-Philippe Platteau

Subjects: economics and finance, public finance

Extract

Jean-Philippe Platteau* INTRODUCTION 1 The main advantages associated with decentralized, participatory development lie in the better knowledge of local conditions and constraints (environmental, social and economic) that communities or user groups possess, as well as the dense network of continuous inter-individual interactions that constitute community life (often labelled “social capital” in the recent literature. As a result of these two features, communities are assumed to be better able than a central government or an external donor not only to set up priorities, identify deserving beneficiaries, design projects, select techniques and inputs, but also to enforce rules, monitor behaviour and verify actions. Furthermore, people’s motivation to apply effort and to contribute resources is expected to be stronger when they are let free to choose their objectives and their ways to achieve them rather than being told from above what to do and how to do it (see, for example, Hoddinott et al., 2001; Conning and Kevane, 2002; Bardhan, 2002; Platteau and Abraham, 2002, 2004). In view of all these advantages, participatory development is viewed as an effective mechanism for reducing poverty and empowering the poor, for spreading democracy and accountability and for making progress both inclusive and sustainable. Given the above diagnosis and following the disappointing performances of development aid when channelled through central governments, it is not surprising that the donor community, bilateral donors and big international organizations alike, have laid stress on participation in the design of their development assistance programmes, and/or to funnel substantial amounts of aid money...

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