Decentralization_what_and_why_Rondinelli_and_Ford[1]

Decentralization_what_and_why_Rondinelli_and_Ford[1] -...

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W ORLD B ANK I NSTITUTE WBI Working Papers in collaboration with PREM network Decentralization Briefing Notes Edited by Jennie Litvack and Jessica Seddon Contributors Junaid Ahmad, Harry Blair, Talib Esmail, James Ford, Bert Hoffman, Graham Kerr, Elizabeth King, Riitta-Liissa Kolehmainen- Aitken, Ernst Lutz, Keith McLean, Dennis Rondinelli, David Sewell, Anwar Shah, Giulio De Tommaso, and Dana Weist
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- iii - Contents Foreword ............................................................................................................... v Acknowledgments .............................................................................................. vii Contributors .......................................................................................................... ix 1. What and Why ................................................................................................. 1 What Is Decentralization? ................................................................................ 2 Dennis Rondinelli Rationale for Decentralization .......................................................................... 6 James Ford 2. Project Design: Political, Fiscal, and Administrative Decentralization ............. 9 Constitutional, Legal, and Regulatory Framework for Decentralization ......... 11 James Ford Participation, Civil Society, and Decentralization .......................................... 15 Jessica Seddon Expenditure Assignment ............................................................................... 19 Anwar Shah Issues in Tax Assignment ............................................................................... 23 Anwar Shah Intergovernmental Transfers and Grants ........................................................ 27 Anwar Shah Decentralizing Borrowing Powers ................................................................. 32 Junaid Ahmad Civil Service Reform and Decentralization .................................................... 39 Jessica Seddon and Giulio De Tommaso Information and Monitoring in Decentralized Systems ................................. 43 Dana Weist Local Technical and Managerial Capacity ...................................................... 45 Graham Kerr 3. Service Delivery ............................................................................................. 51 Decentralization of the Education Sector ..................................................... 52 Keith McLean and Elizabeth King Decentralization of the Health Sector ........................................................... 57 Riitta-Liissa Kolehmainen-Aitken Decentralization and Safety Nets .................................................................. 62 Jennie Litvack Decentralization of Infrastructure .................................................................. 66 Jessica Seddon Decentralization of the Water Supply ........................................................... 72 Keith McLean Natural Resources Management and Decentralization .................................. 77 Ernst Lutz and Talib Esmail
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Decentralization Briefing Notes - iv - 4. Potential Impacts of Decentralization ........................................................... 83 Equity and Multileveled Government ........................................................... 83 David Sewell Macroeconomic Impact of Decentralization ................................................ 89 Bert Hoffman Decentralization and Economic Growth ...................................................... 93 Jessica Seddon Accountability, Transparency, and Corruption in Decentralized Systems .... 96 Harry Blair Boxes 2.1 Principles and Better Practices in Grant Design ............................................ 30 2.2 Criteria for the Design of Intergovernmental Fiscal Arrangements ................ 31 2.3 Evolution of Capital Markets and Decentralization of Borrowing Powers .... 35 3.1 Alternative Ways to Produce or Provide Local Public Services .................... 67 Tables 2.1 A Representative Assignment of Expenditure Responsibilities .................... 21 3.1 Main Effects of Decentralization on Roads, Electricity, and Water Supply... 71 3.2 Division of Responsibilities between Agency and Water Users ................... 75
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- v - Foreword Decentralization, a set of policies that encompasses fiscal, political, and adminis- trative changes, can impact virtually all aspects of development. The structure of intergovernmental relations affects everything from the efficiency and equity of service delivery, the social safety net, and poverty alleviation programs to the de- velopment of the financial sector and macroeconomic stability. The division of power and responsibility between levels of government also raises issues of institutional capacity, as well as corruption and governance. Unfortunately, the far-reaching
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