Decentralization in Developing Economies
AbstractWe develop a 2-sided principal-agent framework to think about optimal decentralization in developing economies. We can think of a benevolent government as the principal, trying to maximize social welfare, or citizens as principals, trying to get a non-benevolent government to act in their interests. In both cases, principals face information and enforcement constraints, which differ at different levels of government. After discussing the empirical evidence on patterns and causal effects of decentralization, we review the literature on these information and enforcement constraints, highlighting the most important areas in which developing countries differ from developed countries and discussing the implications for decentralization. We then consider provision of public goods by non-governmental organizations and discuss an emerging literature that examines policies which leverage potential advantages of developing economies (local information and social networks) to improve policy outcomes. We conclude by outlining promising areas for future research.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19402.
Date of creation: Sep 2013
Date of revision:
Note: DEV PE POL
Contact details of provider:
Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Web page: http://www.nber.org
More information through EDIRC
Find related papers by JEL classification:
- H2 - Public Economics - - Taxation, Subsidies, and Revenue
- H4 - Public Economics - - Publicly Provided Goods
- H7 - Public Economics - - State and Local Government; Intergovernmental Relations
- I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
- J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
- L3 - Industrial Organization - - Nonprofit Organizations and Public Enterprise
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Kis-Katos, Krisztina & Sjahrir, Bambang Suharnoko, 2014.
"The Impact of Fiscal and Political Decentralization on Local Public Investments in Indonesia,"
IZA Discussion Papers
7884, Institute for the Study of Labor (IZA).
- Krisztina Kis-Katos & Bambang Suharnoko Sjahrir, 2014. "The impact of fiscal and political decentralization on local public investments in Indonesia," Discussion Paper Series 25, Department of International Economic Policy, University of Freiburg, revised Jan 2014.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.