(World Bank, Washington, DC, 2007-02)
Decentralization is the transfer of
responsibilities from the central government to subnational
agencies empowered to act as increasingly autonomous
entities within their geographical and functional domains.
In theory, decentralizing infrastructure services can
deliver efficiency gains when service benefits accrue mainly
to the local population-such as in water and sanitation,
urban transit, and waste management. Subnational agencies
are indeed better placed than the central government to
tailor infrastructure services to the needs of local
constituencies (allocative efficiency) and deliver them at
lower costs (productive efficiency). In practice, the
economic benefits of decentralized infrastructure services
are by no means a given, as they are contingent upon
effective coordination among tiers of governments (regional
coordination) and accountability mechanisms for results achieved.
(World Bank, Washington, DC, 2001-04)
Bad governance undermines development.
Two important types of World Bank support for local
governance are social funds and broadly based support for
governments committed to decentralizing responsibility and
power to local governments and other local institutions. But
there are concerns that these two approaches, which address
different elements of governance, sometimes work at
cross-purposes. A study was therefore commissioned to
examine the interaction between social funds and
decentralization in Bolivia and Honduras (advanced
decentralization), Peru and Zimbabwe (some
decentralization), and Cambodia, Malawi, and Zambia (little
or no decentralization). This Note is based on the findings
of the study.