Decentralization: Why, What, and to Whom?

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Three questions stand out in development policy-making. First, in a particular country, what is the content of development; what is its direction; what are the objectives aimed at, with what instruments? Second, at what levels are decisions being taken, in which domain and with what range – centrally or more decentralized; by governmental institutions or by market partners? What type of decentralization has been chosen: geographical-territorial or ethnic-cultural? Are different types of decisions – regarding production, finance, investment, trade, employment, education, health care, social services and the environment – taken at different levels? How are they harmonized? Third, given the level of decision, how are decisions being made, and by whom? Are they made democratically or in an authoritarian manner, on the basis of market motives or the public interest, induced by tradition or by a preference for modernity, made mainly by men or by women, by elders or by younger generations, in a bureaucratic fashion, grounded in law, customs, a plan, or carried out flexibly? Who is responsible for coordination, for implementation and for feedback?

These questions can be phrased in descriptive terms or in the form of recommendations, based on theoretical analysis or on practical experience. They concern the development of a society, the economic order of a country and the political system of a nation-state. They were addressed extensively in classical literature, but received renewed attention owing to developments after the Second World War: the emerging ideological conflict between East and West and the decolonization of countries in the South. Both developments had an impact on national decisions concerning “the design of development”: what, where, how and by whom?

Two challenges dominated the debate during the first decades after 1945: building up new sovereign nation-states, and achieving sustained national economic growth for all. In most countries in the so-called third world, some form of a “developmental state” was introduced. There were variations, owing to historical differences, arbitrary frontiers, cultural diversities, proneness to conflict and vulnerability to threats from outside. The position of a country in the sphere of influence of East or West played a role as well. The choices were also influenced by aid and advice in the framework of development cooperation, by donors, Bretton Woods organizations and United Nations Agencies. Despite all this, a fair degree of centralism has characterized nearly all developing countries, which share a need to survive independently, to establish a state, to build a nation and to grow stronger.

This changed after 1989. Questions concerning the content and direction of development were approached from a different angle: sustainable development, human development, human security and poverty reduction became the chief objectives after economic growth. Questions regarding the level and domain of decision-making received new answers following the victory of capitalism over communism. Liberalization, privatization, deregulation and good governance became dominant themes. Finally, questions about the way in which decisions should be made were influenced by ideas regarding people’s participation and ownership, grassroots development, democracy and human rights.

The new philosophies had one viewpoint in common: a preference for “bottom up” rather than “top down”. Fostering human development, guaranteeing human security and maintaining human rights would require “development from below”, and this could be achieved through economic, political and administrative decentralization.

Decentralization is the theme of this book. It is state of the art. The authors sketch an outline of decentralization theory; discuss context and conditions; and present case studies and lessons learned. I have dealt with decentralization questions as an academic, as a policy-maker, as a politician, in my country and in international development cooperation. At first, my ideas were mainly macro oriented. However, I learned that implementation is more important than planning, and that models are not applicable equably. Everything is country specific, even situation specific. I gradually became an advocate of the decentralization of powers and the delegation of authority. However, I also learned that decentralization is not a panacea.

Any suggestion to decentralize should start with the question: why? What is the purpose? It is far from certain that decentralization will offer a greater chance of meeting macro objectives, such as higher economic growth or national cohesion. The primary objective of decentralization should be to enhance the well-being of the people of the region or the population group to whom authority is delegated.

This logically leads to a second question: delegation of what, and to whom? Decentralization of legal authority, administrative command and control of resources implies the transfer of power to local leaders. This could result in the opposite of what had been aimed at. Local elites may abuse those powers, and cannot easily be restrained by others. Building up countervailing power, keeping a balance of powers, may, after decentralization, become more difficult than before. Conflicts may rise between traditional local elites and newly established local institutions of the modern nation-state. The national pattern of majority and minority relations – for instance between tribes, indigenous peoples, ethnic groups or religious communities – may become more complicated following regional decentralization of powers. This may lead to conflict escalation, affecting other regions as well.

So, a third question has to be raised: will the nation-state remain viable despite decentralization? In some cases, the viability of the state will be enhanced through decentralization, but there are risks, not only for people at the grassroots but also for the state.

Decentralization is a fascinating subject. It may enchant and confuse. The chapters in this book provide the thoughtfulness required in order to strike a balance between nation-building and human development.

Foreword to: Joakim Öjendal & Anki Dellnäs, The Imperative of Good Local Governance. Challenges for the Next Decade of Decentralization. United Nations University Press, Tokyo, 2013