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Decentralization And Infrastructure: From Gaps To Solutions

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Abstract

The subnational dimension of infrastructure emerges as one of the greatest challenges in contemporary public finance policy and management. Given the localized nature of most infrastructures, ensuring its efficient provision represents a challenge for all countries irrespective of their level of centralization or decentralization. This paper introduces the fundamental questions surrounding the provision of infrastructure in decentralized settings and summarizes the findings from a collection of original essays prepared for this volume by a set of worldwide experts on this subject with the objective of advancing our understanding of the interplay between decentralization and infrastructure. More specifically, the paper discusses the extent of infrastructure gaps and the quality of subnational spending; inquires how functional responsibilities, financing and equalization can be designed; discusses sector-specific arrangements; drills down to the key steps of the public investment cycle and management aspects; and analyzes the political economy and corruption challenges that typically accompany decentralized infrastructure projects. The paper also presents avenues for the strengthening of decentralized public investment and infrastructure provision processes, concluding that they need to be country-, sector- and place-specific. While it is clear that institutional arrangements for infrastructure management will vary across countries, in all cases several decision-making steps need to be coordinated across levels of government in order to ensure efficiency in delivery, equity in spending, and accountability over final results.

Suggested Citation

  • Jonas Frank & Jorge Martinez-Vazquez, 2014. "Decentralization And Infrastructure: From Gaps To Solutions," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1405, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
  • Handle: RePEc:ays:ispwps:paper1405
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    File URL: http://icepp.gsu.edu/files/2015/03/ispwp1405.pdf
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    References listed on IDEAS

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    1. Andres,Luis Alberto & Biller,S. A. Dan & Herrera Dappe,Matias, 2014. "Infrastructure gap in South Asia : infrastructure needs, prioritization, and financing," Policy Research Working Paper Series 7032, The World Bank.
    2. Kappeler, Andreas & Solé-Ollé, Albert & Stephan, Andreas & Välilä, Timo, 2013. "Does fiscal decentralization foster regional investment in productive infrastructure?," European Journal of Political Economy, Elsevier, vol. 31(C), pages 15-25.
    3. repec:wbk:wbpubs:27762 is not listed on IDEAS
    4. Ana Herrero-Alcalde & Jorge Martinez-Vazquez & Encarnacion Murillo-Garcia, 2012. "The Challenge of Designing Capital Equalization Transfers: An Application to Spanish Regions," Publius: The Journal of Federalism, Oxford University Press, vol. 42(2), pages 260-288, April.
    5. Estache, Antonio, 2010. "Infrastructure finance in developing countries: An overview," EIB Papers 8/2010, European Investment Bank, Economics Department.
    6. Douglas Sutherland & Sónia Araújo & Balázs Égert & Tomasz Kozluk, 2011. "Public Policies and Investment in Network Infrastructure," OECD Journal: Economic Studies, OECD Publishing, vol. 2011(1), pages 1-23.
    7. Jorge Martinez-Vazquez & Andrey Timofeev, 2012. "Propensity to Invest and the Additionality of Capital Transfers: A Country Panel Perspective," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper1216, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    8. Kappeler, Andreas & Välilä, Timo, 2008. "Fiscal federalism and the composition of public investment in Europe," European Journal of Political Economy, Elsevier, vol. 24(3), pages 562-570, September.
    9. Antonio Estache & Marianne Fay, 2009. "Current Debates on Infrastructure Policy," World Bank Publications, The World Bank, number 27762, January.
    10. Pranab Bardhan & Dilip Mookherjee, 2006. "Decentralisation and Accountability in Infrastructure Delivery in Developing Countries," Economic Journal, Royal Economic Society, vol. 116(508), pages 101-127, January.
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