Government Decentralization in the 21st Century

A Literature Review

Decentralization is widely lauded as a key component of good governance and development. It is also broadly recognized as a process fraught with complexity and potential failure. This background paper offers a review of 33 scholarly papers, articles, and books on decentralization from 1956 to the present, with the majority of works (26) published since 2000. It includes research by the U.S. government, the World Bank, national and international think tanks, and a wide range of universities and scholars. An annotated bibliography is included at the end summarizing the reviewed works.

The implicit rationale for decentralization goes something like this. If a government can perform closer to the people it is meant to serve, the people will get more out of government and, in turn, will be more willing to accept that government’s authority. The rationale is compelling, and despite the potential pitfalls associated with implementation, most scholars agree that a decentralized system of government is more likely to result in enhanced efficiency and accountability than its centralized counterpart. Still, disparities between the theoretical rationale for decentralization and what is actually gained in practice are gaping. Real-life efforts to decentralize across a range of contexts have failed for a variety of reasons, many of them difficult to measure. Therefore, much of the scholarly literature on the subject focuses on understanding what has failed and why and on hypothesizing potential improvements to implementation. To that end, the articles included in this literature review deconstruct particular aspects of the decentralization process in an attempt to identify their negative and positive outcomes.

Stacey White