Author(s): Anwar Shah, Theresa Thompson
During the past two decades, a silent re volution in public sector governance has swept across the globe aiming to move decision making for local public services closer to the people. The countries embracing and adapti ng to this silent revolution have had diverse motives and followed even more di verse approaches. This paper attempts to present a stylized view of the motivations and approaches used to strengthen local governance. The quest for the right balance, i.e. appropriate division of powers among different levels of government, is not alwa ys the primary reason for decentralizing. There is evidence that the decentralization deci sion may have more to do with short-term political considerations than the long-run bene fits of decentralization. To take stock of progress worldwide, we take a comparative look at developments in po litical, fiscal and administrative decentralization for a selected group of countries. Most of the decentralization literature deals with normative issues regarding the assignment of responsibilities among different levels of government and the design of fiscal transfers. The process of decentralization has not received the attention it deserves as the best laid plans can fail due to im plementation difficulties. We revisit major controversies regarding prefe rred approaches to obtaining a successful outcome. Key approaches examined are big push versus small steps; bottom up vs. top down; and uniform vs. asymmetric decentralization. Finally, Indonesia’s 1999 “big bang” decen tralization program is evaluated. The program should be commended for its achieve ments over a short period of time, however incentives are lacking for local governments to be accountable and responsive to their residents.