Linking context and strategy in donor support for decentralisation: a diagnostic framework

International donors, long‐standing supporters of decentralisation reforms in developing countries, often face the challenge of aligning programme assistance to the great variety of country governance settings in which many operate. This article presents a framework for assessing the implications of governance and institutional context for a range of programming challenges, with particular reference to the challenge of decentralised programming. The framework has three conceptual steps. Country governance and institutional change environments are first described in terms of how enabling governance capacities are for decentralised programming, and how rapid and predictable the rate of institutional change is. Second, these environmental considerations are associated with overall assistance modalities of donors, in areas such as the type of partners sought and interventions selected. Third, a range of options concerning the aims, scope and extent of decentralising programming are reviewed and linked to the diagnostic framework above. The framework is broadly derived from organisational contingency theory, which it is argued has been relatively neglected in the study of development administration due to a preponderance of analysis based on single‐case studies. Copyright © 2007 John Wiley & Sons, Ltd.     

Ethnicity,decentralisation and the fissile state in Georgia

This article addresses the problems entailed in decentralising a successor state of the former Soviet Union. On many different scales, Georgia should be a wealthy country. The population is well educated, there is rich agricultural land, a thriving wine industry, several mineral extraction industries and access to oil. The central argument of this article is that it is governance, or rather the failure of governance that is at the heart of many of Georgia's problems—in particular, a failure over a number of years to find a balance between the considerable ethnic diversity of the country and their aspirations regarding self‐government, and the need for the assertion of central power from Tblisi in occupying the power vacuum left by the demise of the Soviet Union. The structure of the article moves through an analysis of the context of decentralisation, into a brief survey of the major ethnic groups and the nature of the local government system, paying particular attention to the attempts by Tblisi to provide a coherent glue for a state that is liable to break apart. The concept of the ‘fissile state’ is used to convey this brittle context within which institutional reform needs to take place given the pressures from below and the pressures exerted by external actors as Georgia seeks to move closer to the European polity. Copyright © 2004 John Wiley & Sons, Ltd.     

Unpacking the Path‐Dependent Process of Institutional Change for PPPs

In the recent past, several countries and states have begun to use Public‐Private‐Partnerships (PPPs) for infrastructure development and have attempted to create institutional environments that enable PPPs. Providing an enabling environment for PPPs entails a combination of institutional creation and changing existing institutions relating to project procurement. This paper attempts to understand how path‐dependant institutional change takes place in the context of PPPs and their enabling environments, and why different institutional environments evolve differently, using two cases: the implementation of PPPs in the road sector in the Netherlands and in the Indian state of Tamil Nadu. We identify two factors that can be used as predictors of the direction of institutional change: a long‐term orientation towards institutional change and a willingness to learn and modify transitional institutions. Where these factors exist, and thereby provide a goodness of fit, institutional change is likely to occur.     

Defending the organisation,not the members: Unions and the reform of job security legislation in Western Europe

European labour markets are often described as rigid with comparatively high levels of job protection that do not allow for the flexible adjustment of employment to economic fluctuations. This interpretation overlooks important sources of flexibility, however. Research has shown that recent labour market policy reforms have allowed for the creation of two‐tier labour markets consisting of insiders in standard employment relationships and outsiders in non‐standard employment. This outcome has typically been explained by pointing to the representational interests of unions or social‐democratic parties. It has been argued that rather than protecting all labour market participants, unions and social‐democratic parties focus on the interests of their members and their core constituency, respectively, most of whom are in standard employment relationships. In contrast, it is argued here that unions' institutional power resources are the crucial variable explaining this outcome. In difficult economic times, when unions are asked to make concessions, they will assent to labour market reforms, but only to those that do not fundamentally threaten to undermine their organisational interests. In the context of job security legislation, this means that unions defend the protection of permanent contracts while they compromise on the regulation of temporary employment. This ‘second best solution’ allows them to protect their organisational interests, both by retaining their institutional role in the administration of dismissals and by living up to their institutional role as one of the organisations responsible for the direction of labour market policy reform. Using fsQCA this article shows that unions' institutional power resources are more apt to explain the observed two‐tier reform pattern than the unions' or the social‐democratic parties' representational interests.     

Challenge Funds in International Development: Definitions,Variations and Research Directions

The use of challenge funds to promote economic and social development continues to grow but has been the subject of relatively little research. This article draws on institutional economics (particularly principal‐agent theory) to define challenge funds and review how they differ from other development funding mechanisms, taking into account their purpose, financial terms, interagency relationships, screening processes, selection mechanisms, implementation and risk sharing characteristics. It then draws on web‐based data for 50 challenge funds to analyse variation in some of these characteristics. The paper identifies evaluability as an important influence, including the relative importance attached to promoting the financial performance of grantees relative to the indirect social benefits of their activities. We conclude with suggestions for further research into the design and performance of challenge funds. Copyright © 2015 John Wiley & Sons, Ltd.     

Service delivery in francophone West Africa: the challenge of balancing deconcentration and decentralisation

The article reviews the experiences with decentralisation of one West African country, Guinea, with the intent of drawing lessons and exploring approaches to assist countries in the sub‐region in rendering decentralisation—an effective means for service delivery improvements. Section II describes the West Africa context in terms of the dynamics of deconcentration–decentralisation and lays out a conceptual framework to guide the analytical assessment of countries in the sub‐region, attempting to decentralise. This framework is used in the Guinea case, described in Section III. Section IV concludes by synthesising the profile of Guinea, and positions its dominant style in relation to the proposed ideal types of decentralisation approaches. This part of the article discusses the implications of its findings for decentralisation policy and implementation, and offers some remarks on the road ahead for decentralisation in West Africa. Copyright © 2004 John Wiley & Sons, Ltd.     

The Irish election of November 1982

Changes in centre‐periphery relations, both institutional (most notably decentralisation) and socio‐economic (the growing importance of cities) have radically altered the environment in which French political parties operate. The unprecedentedly close links between parties and the local political system that have resulted have profoundly affected power structures within the parties. Just as the Fifth Republic ‘presidentialised’ parties, so decentralisation has ‘localised’ them. The case of the Rassemblement pour la République, the inheritor to the top‐down, presidentialist tradition of Gaullism, is a remarkable illustration of this transformation.     

Money for our people? Decentralisation and corruption in Romania: the cases of the equalisation,infrastructure and pre‐university education funds

In spite of the attempts, in the most recent years, to introduce simple, accountable and rule‐based mechanisms governing the flows of funds for Romanian local governments (LGs) there is evidence showing that deviations from the norms are still widespread and undermine the stated goals of many policies. This article aims to explore to what extent the political factor (party affiliation, i.e. local informal power networks) interferes with the allocation of public funds as far as three main areas of decentralised policy are concerned: (i) the general purpose equalisation transfers; (ii) the Roads Fund grants and (iii) the transfers for financing the pre‐university education. These components represent a relatively large share of the local budgets and are illustrative for two important attributions Romanian LGs perform today: maintaining the local infrastructure and providing essential social services. Through a set of variables—measuring, on the one hand, the real pattern of resource allocation and on the other hand, the intensity of politicisation in the three areas—we tested the hypothesis that intergovernmental financial flows in Romania are to a large extent captured by rent‐seeking groups. It turns out that this is indeed the case with the funds for infrastructure, and much less so with the transfers financing pre‐university education. Some conclusions from these contrasting situations are drawn which reflect on the broader discussion, the link between decentralisation and corruption. Copyright © 2005 John Wiley & Sons, Ltd.     

Institutional competitiveness,social investment,and welfare regimes

Are the rather generous welfare regimes found in most European countries sustainable; that is, are they competitive in a globalizing economy? Or will they, on the contrary, be crowded out by the more austere and less expensive regimes generally found in liberal Anglo‐Saxon countries? We first discuss this issue conceptually, focusing on the notions of institutional competitiveness, social investment, and short‐term and long‐term productivity. We then briefly present the results of an empirical study of 50 social indicators of policies and outcomes in 20 Organization for Economic Co‐operation and Development (OECD) countries during the early 2000s. We conclude that welfare regimes have not been forced to converge through a “race to the bottom.” There remain three distinct ways to face the “trilemma” of job growth, income inequality, and fiscal restraint: Nordic countries achieve high labor market participation through high social investment; Anglo‐Saxon countries attain the same objective through minimal public intervention; while Continental European countries experience fiscal pressures because their social protection schemes are not promoting participation to the same extent.     

The Adoption and Abandonment of Council‐Manager Government

What accounts for patterns of city adoption and abandonment of council‐manager government? Despite dozens of empirical studies, we lack a systematic understanding of these forces over time because previous work has relied on cross‐sectional designs or analysis of change over short periods. This article begins to fill this lacuna by constructing a historical data set spanning 75 years for the 191 largest cities with either mayor‐council or council‐manager governments in 1930. Event history analysis is applied to isolate adoption and abandonment trends and to provide new evidence revealing the forces that have shaped the trajectory of institutional change in U.S. cities. This analysis reveals that social context factors—in particular, economic conditions—generate both adoptions and abandonments.     

Is small beautiful? Village level taxation of natural resources in Tanzania

This article examines collection of natural resources revenue by village governments in Tanzania as part of a decentralisation reform. An analysis of empirical data in the form of taxation records from 14 villages, which collect and retain revenues on natural resources utilisation suggests that decentralising revenue collection to the lowest local government tier may yield: (i) considerable increases in revenue collection; (ii) increased transparency in public finances through requirements that village governments document their incomes and expenditures to the villagers; and (iii) a financial surplus that is used to finance public services at the village level. The evidence presented in this article suggests that decentralising taxation to the lowest local government tier may be a viable approach to enhance revenue collection on the utilisation of relatively low value natural resources, and assure that a share of the collected revenue is used to finance public services. Copyright © 2007 John Wiley & Sons, Ltd.     

How Social Wealth Funds Could Help Tackle Inequality

This article examines the potential to tackle the roots of inequality by the introduction of one or more social wealth funds. Such funds would aim to capture some of the financial gains from the private ownership of capital—a principal driver of inequality—and use the proceeds for wider community benefit, such as investment in social infrastructure. In recent decades a number of countries have introduced a variant on such funds, mostly taking the form of state‐owned sovereign wealth funds resourced through the exploitation of oil, and used for a diversity of economic purposes. In contrast, the UK has failed to take the opportunity to create such funds by, for example, reinvesting the revenue from the sales of public assets. So would it be possible to build one or more such collectively owned funds in the UK, and if so, how should they be financed? As well as funding social investment and anti‐inequality programmes, could such a scheme also help finance a regular Citizen's Dividend payment or a Citizen's Income scheme?     

Redistributive policies in decentralised systems: The effect of decentralisation on subnational social spending

This article uses cross‐national data to examine the effects of fiscal and political decentralisation on subnational governments’ social expenditures. It revisits the benefit competition hypothesis put forward by fiscal federalism research, which posits that subnational governments in decentralised countries match welfare benefit reductions by their peers to keep taxes low and avoid an in‐migration of welfare dependents. As a consequence, subnational social expenditures are assumed to plateau at similar and low levels. Using a new cross‐national dataset on social expenditures in 334 subnational units across 14 countries and 21 years, the author explores whether benefit competition causes subnational governments to converge on similar levels of social spending. The analysis reveals that as countries decentralise, subnational social spending levels begin to diverge rather than converge, with some subnational governments reducing their social expenditures and others increasing them. Furthermore, decentralisation is not likely to be associated with lowest common denominator social policies, but with more variability in social expenditure. The article also examines the effects of other macro‐level institutions and demonstrates that policy coordination influences the relationship between decentralisation and subnational social spending levels.     

Patrons against clients: Electoral uncertainty and bureaucratic tenure in politicized states

Why would incumbents undertake institutional reforms that constrain their discretion over state resources? Many studies point to electoral competition in response. They argue that incumbents who risk exit from office undertake reform to insure themselves against potentially hostile successors. This paper challenges this line of reasoning, arguing that it confounds two potential implications of electoral competition – potential and certain electoral losses – which yield contrary reform incentives. Certain exits from office may well incentivize reforms as insurance. Where elections are contested, however, incumbents face incentives to resist reforms that constrain discretion over state resources that provide incumbents with electoral advantage. This argument is developed and assessed with an institutional reform the literature has so far neglected: job stability protections (tenure) in politicized bureaucracies. A case analysis of the Dominican Republic and suggestive cross‐country data confirm theoretical predictions: electoral uncertainty dis‐incentivizes tenure reform. Electoral competition may thus be a double‐edged sword for institutional reform.     

Toward a new institutional strategy framework for political marketing

The present literature on political marketing strategy has provided important knowledge about how the material context of technologies, polls or competitors influences strategy formulation. However, less attention has been directed to the constraints facing a political organization from the social context related to habits, norms or social conventions. This article thus aims at bringing organizational new institutional theory into the field of political marketing strategy. Accordingly, it is investigated how political organizations when initiating marketing strategies act or react toward institutionalized demands in their environment, such as issues or ideas that are considered socially appropriate. As such, a strategy framework consisting of a phase model and a typology is developed. The phase model is drawn from extant literature within organizational new institutional theory stating that decision makers will (1) scan information from their environment, (2) interpret this incoming information in available cognitive categories and (3), finally, select a strategy premised on their cognitive interpretations. On this ground, we build a novel typology that specifies which political marketing strategy decision makers will select under different cognitive framings of their environment. Here, we delineate four ideal type political marketing strategies—conformity, decoupling, defense and entrepreneurial—that correspond to how organizational decision makers interpret their institutional surroundings. Copyright © 2012 John Wiley & Sons, Ltd.     

Party competition over decentralisation: The influence of ideology and electoral incentives on issue emphasis

Under what conditions is decentralisation a salient issue for state‐wide political parties? It is argued in this article that the extent to which state‐wide parties emphasise decentralisation depends on their strategic considerations: on their overall ideology, on the electoral incentives created by the context in which they compete, and on the interaction between the two. The results of the analysis of party manifestos in 31 countries since 1945 are as follows. First, parties that pay greater attention to cultural matters relative to economic matters tend to talk more about decentralisation. Second, the systemic salience of decentralisation also encourages parties to talk more about decentralisation. Third, the larger the regionally based ethnic groups within a country, the more salience all state‐wide political parties will attach to decentralisation. Finally, only parties that put greater relative emphasis on cultural matters tend to respond to the electoral threat of regionalist parties. The influence of territorial diversity on the salience of decentralisation thus works through two channels and is partly conditioned by political parties’ ideological profile.     

Decentralising to Villages in Indonesia: Money (and Other) Mistakes

Nearly 15 years after embarking on its large‐scale decentralisation programme, Indonesia has decided to extend its efforts to the village level. Decentralising to villages is intended to improve service delivery performance at the lowest administrative tier and reduce social inequality and poverty. A number of potential difficulties with the design of Indonesia's nascent village decentralisation initiative have already become apparent. Methods used to allocate funds to villages are particularly problematic. Oddly, fund distribution procedures insist to a large extent on equal per village allocations, despite the significant heterogeneity of villages. And they ignore other sources of revenue to which villages have access. In the event, village revenues will be very inequitably distributed: villages with high levels of poverty will receive less money than they need and villages with access to significant funding from oil and gas revenues will receive more than required. Also, village service responsibilities are unclearly defined, village financial management systems are inadequately prepared to handle large increases in funding, and mechanisms to monitor and control village spending are underdeveloped. These difficulties will severely constrain the achievement of official objectives and create further challenges for reformers in their attempts to combat corruption at the subnational level. Copyright © 2015 John Wiley & Sons, Ltd.     

Who is responsible for what? Clarity of responsibilities in multilevel states: The case of Spain

There is a theoretical disagreement between the classical normative positive view on decentralisation, which states that the fragmentation of power shifts policy more closely into line with citizens' preferences, and a more recent critical view that states that decentralisation blurs attribution of responsibility. This disagreement can only be resolved by refining the understanding of specific institutional designs. The theoretical claim in this article is that the relation between multilevel governance and clarity of responsibilities is contingent upon the type of decentralisation in place. To test this proposition, individual data from an asymmetrically decentralised system – the Spanish State of Autonomies – are used. Results show that the relationship between decentralisation and clarity of responsibility has a u‐shape. Responsibility attribution is clearer in regions with high and low levels of decentralisation, where one level of government clearly predominates over the other, than in regions with a more intertwined distribution of powers.     

Institutional competitiveness in the global economy: Denmark,the United States,and the varieties of capitalism

Despite high taxes, a large welfare state, and much economic regulation, Denmark competes successfully against other advanced capitalist economies. Denmark’s success is based in large part on its institutional competitiveness – its capacity to achieve socioeconomic success as a result of the competitive advantages that firms derive from operating within a particular set of institutions. The institutional basis for successfully coordinating labor markets and vocational training programs are examined for Denmark and the US – two countries that were very different institutionally but very successful in the 1990s and in the 2000s. We show that there is no one best way to achieve success in today’s global economy, except with respect to social inequality; that the mechanisms underlying institutional competitiveness are more complex than often recognized; that institutional hybrids can be as successful as purer political economic cases; and that high taxes and state spending can enhance socioeconomic performance. As such, this paper challenges both neoliberalism and the varieties of capitalism school of comparative political economy.     

Cracks in the Opposition: Immigration as a Wedge Issue for the Reagan Coalition

The absence of a core means that a majority coalition can never choose a policy that will keep it safe from minority appeals to its pivotal members. In two dimensions, strategic minorities will always be able to offer pivotal voters attractive policy concessions. We argue that this instability of multidimensional politics explains why minorities raise wedge issues and how wedge issues result in partisan realignment in legislative politics. Applying agenda‐constrained ideal point estimation techniques to immigration debates, we show that the Reagan coalition—pro‐business and social conservatives—has been vulnerable on the wedge issue of immigration and that parties have switched their positions on immigration over the last three decades. We use the uncovered set as the best‐fit theoretical solution concept in this legislative environment, to capture the limits of majority rule coalitional possibilities and policy change in the two‐dimensional absence of a core.