Studies in Fiscal Federalism and State–local Finance series
Edited by Ehtisham Ahmad and Giorgio Brosio
Chapter 10: Evaluating the Effects of Decentralization on Public Service Delivery: The Spanish Experience
Albert Solé-Ollé* 1 INTRODUCTION In the last three decades, a substantial number of developed and developing countries have initiated processes of decentralization of responsibilities regarding the provision of public services (Shah and Thompson, 2004). The exact meaning of the word decentralization differs from country to country. In some cases, decentralization means to transfer administrative responsibilities to decentralized agencies, while in many cases it involves the creation of elected lower-tier governments (Shah, 1998). Even in the case of politically autonomous entities, the transfer of responsibilities is often partial (Ahmad et al., 2006), in the sense that the central government retains important regulatory and/or financing powers over service provision,1 so there is wide variation both in the kind and depth of the decentralization reform. But the motives for decentralization are as varied as its meaning. In many cases, decentralization is a crucial ingredient of a democratization package, as in Latin America or the former communist countries (Jakubowski and Topińska, 2009). In other cases, decentralization is seen as a way to appease secessionist regions and reduce the level of ethnic and regional conflict, as in Indonesia or South Africa (see, for example, Inman and Rubinfeld, 2005). There are also a few cases where the aim was to improve the delivery of public services, and the World Bank and other donors used to emphasize this goal (World Bank, 1999). But, as long as democracy and good governance are a precondition for the improvement of public services (Shah, 2006), even those cases...
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