FEDERALISM AND DECENTRALIZATIONGov1109 #5

RECAP: CLASSES SO FAR… Choices & processes of constitution-building

Power-sharing or power-concentrating Elite-led top-down or inclusive bottom-up processes Key building blocks: pros and cons of each…

Electoral systems and processes Majoritarian, mixed, proportional Sub-type variations

Types of executives Presidential, mixed, parliamentary executives Horizontal power-sharing

Types of federalism and decentralization Vertical power-sharing

TODAY’S STRUCTURE

1. Why the growth of multilevel governance?

2. Comparing normative arguments for and against

decentralization

3. Many types of federalism and decentralization

4. The impact of federalism on democracy

5. Case studies – India and Bangladesh, Brazil, Japan, Russia and

Sweden: one size does not fit all?

RESOURCES Norris Ch 7

Devas and Delay ‘Local democracy…’ Local Government Studies

Andrews and de Vries ‘High expectations…’ IRAS

Forum of Federations www.forumfed.org

1. GROWTH OF MULTILEVEL GOVERNANCE

Civil Society Public sector Private sector

Supra-nationalInternational NGOs and global

networks of activistsMultinational and regional

government

International corporations

National National interest groups, non-governmental organizations,

voluntary societies

Nation-state

Central organs of the national legislature, core executive and

bureaucracy, and national judiciary

Privatization of state sector nationalized assets

Sub-national Regional, local and community interest groups, non-

governmental organizations, voluntary societies

Federal constitutions safeguarding state’s rights and autonomy over some functions

Political, fiscal and administrative decentralization

to regional, local and community elected bodies

Privatization of regional and local sector assets and

contracting out of services

1. GROWTH OF MULTILEVEL GOVERNANCE- WHY?

WHY GROWING DECENTRALIZATION WORLDWIDE? (REF DEVAS AND DELAY)

1. Bottom-up demand; Reaction against perceived failures of the central state eg post-Communist Europe

2. Aspirations of nationalist movements Eg Spain, Belgium, United Kingdom, Canada, Indonesia,

Nigeria, Russia

3. Post-war peace-building process Eg Uganda, South Africa, Cambodia, Iraq

4. Role of international development agencies Part of the neo-liberal ‘Washington consensus’ Eg World Bank

2. NORMATIVE CLAIMS: THE PROS AND CONS OF DECENTRALIZATION

NORMATIVE DEBATE: CLAIMS IN FAVOR Gives citizens multiple points of access, enhancing

opportunities for public participation Increases the accountability and responsiveness of elected

officials to local citizens (voice to the poor) Local accountability lessens corruption eg social audits Flexible policy learning (see what ‘works’) Managerial efficiency; smaller units Closer to customers; service delivery tailored to local needs In divided societies, accommodates cultural autonomy eg

languages and religious schools More stability and less communal conflict (Nancy Bermeo,

Alf Stephan)

NORMATIVE DEBATE: CLAIMS AGAINST Overlapping multilevel roles and responsibilities reduces accountability and

responsibility (‘buck stops…?’) Reinforces geographic inequalities (eg in welfare benefits, natural resource

revenue) Maximizes opportunities for corruption Managerial duplication, redundancies, coordination costs, bureaucratic

inefficiencies (eg electoral management) Multiple veto points; slowness to respond In divided societies, can encourage ethno-nationalist regional parties and

lead to succession and national break-up, whether peaceful (Czechoslovakia 1993) or violent (Pakistan 1971, Yugoslavia)

Violence and continued conflict in the Russian Federation (in Chechnya?), in the Basque region of Spain, in India (in Kashmir), Nigeria, and Sudan (in Darfur).

Effects may depend upon state boundaries and party competition (Brancanti)

DESIGNING DECENTRALIZATION: (DEVAS AND DELAY)1. Size of units and number of levels

Impact on administrative costs and citizen participation

2. Structure for political accountability Single or plural executive, type of electoral system, use of reserved seats

3. Mechanisms for citizen engagement Periodic elections, citizen consultation, local audits, direct citizen decision-

making eg budgets (next class)

4. Financial structure Local taxes: property, income, business, vehicles Weak expenditure management; unequal resources in districts

5. Center-local relations Tensions between local accountability and central grants

6. Impact on service delivery, poverty and corruption Varied impacts; mixed evidence; depends on above factors “What matters is

how that system is designed and implemented.”

3. MANY TYPES OF FEDERALISM AND DECENTRALIZATION

CONCEPTS: DECENTRALIZATION Decentralization: definition

“The transfer of roles and responsibilities from the central government to different sub-national units”

Types Administrative decentralization

Local agents of central government eg education department Bureaucratic decision-making authority and managerial responsibilities for the delivery

and regulation of public services and for raising revenues are transferred from the central government to sub-national tiers.

May reinforce, not reduce, central control Fiscal decentralization

Locally-determined taxes and spending Strengthen accountability by linking expenditure for local services and goods with source

of revenues Use central performance indices

Political decentralization To an elected body with some degree of local autonomy Direct engagement of local citizens in local decisions

FISCAL AND POLITICAL DECENTRALIZATION

1.000.800.600.400.200.00

Low <<Political decentralization>> High

1.00

0.80

0.60

0.40

0.20

0.00

Low

<<F

isca

l dec

entr

aliz

atio

n>>

Hig

h

US Swi

SpSAfr

Rus

MexMalay

India

Ger

Can

Braz

Belg

Aus

Austl

Arg

GB

Por

Neth

Ita

Indonesi

Geo

Fiji

Zim

Tri

Thai

Taj Swe

Slov

Slovk

Sene

Rom

Pol

Phil

Para Pan

Nor

Nic

Mong

Mol

Maur

Lux

LithLat

Kyr

Ken

IsrIre

IceHung

Guat Fr

Fin

Est

Den

Czech

Cro

Chil

Bul

Bots

Bol

Bela

Aze

Alb

Federal Hybrid unionsUnitary

Type of constitution

Why these contrasts?• Physical size? • Culture and colonial

legacies?• Plural societies?• Levels of democracy

Norris ch 7

CONCEPTS AND TYPES OF FEDERALISM Federal regimes: definitions “An association of states, which are formed for certain

common purposes, but in which the member states retain a large portion of their original independence.” (K. Wheare)

“The combination of shared-rule for some purposes and regional self-rule for others within a single political system so that neither is subordinate to the other.” (Watts)

FEDERAL COUNTRIES (24/193 NATIONS) Argentina Australia Austria Belgium Bosnia and Herzegovina Brazil Canada Comoros Ethiopia Germany India Malaysia Mexico

Micronesia Nepal Nigeria Pakistan Russia St. Kitts and Nevis South Africa Spain Switzerland United Arab Emirates United States of America Venezuela

DISTRIBUTION OF TYPES

Type of regime

Federations (25)Decentralized unions (22)Unitary states (141)

MULTIPLE TYPES (LIJPHART 1999)

Type E.g.

Federal and decentralized Australia, Switzerland, Belgium, US

Federal and centralized Austria, Venezuela, India (?)

Semi-federal Israel, Spain

Unitary and decentralized Denmark, Japan, Norway

Unitary and centralized Costa Rica, Ireland, Jamaica, UK (?), France

TYPES OF FEDERAL AND DECENTRALIZED REGIMES

Figure 7.2: Matrix of vertical power-sharing arrangementsNote: See the text for definitions of each type of constitution and the measures of decentralization which are used. The numbers in parenthesis represent the distribution of each type out of 191 contemporary states worldwide in 2000. Source: Norris Driving Democracy

Type of constitution

Deg

ree

of a

dmin

istr

ativ

e, fi

scal

and

po

litic

al d

ecen

tral

izat

ion

Unitary states

(144)

Hybrid Unions

(22)

Federal states

(25)

Cen

tral

ized

Eg

Kenya

Zimbabwe

Eg

Indonesia

Azerbaijan

Eg

Malaysia

Belgium

Dec

entr

aliz

ed

Eg

Norway

Denmark

Eg

Italy

Eg

Canada

Switzerland

4. THE IMPACT OF FEDERALISM ON DEMOCRACY AND DEMOCRATIZATION

TRENDS IN DEMOCRACY BY TYPE

2004

2003

2002

2001

2000

1999

1998

1997

1996

1995

1994

1993

1992

1991

1990

1989

1988

1987

1986

1985

1984

1983

1982

1981

1980

1979

1978

1977

1976

1975

1974

1973

1972

Year

80.0

60.0

40.0

Low

<<M

ean

FH L

iber

al D

emoc

racy

>>

Hig

h

Federal statesHybrid unionsUnitary states

Type of federalism

Note: The standardized 100-point scale of democracy is described in Table 3.1. The scale measures Liberal Democracy (Freedom House 2000). For the classification of types of constitution, see text.

IMPACT ON DEMOCRACY

54

17

44

37

63

28

61

54

70

30

69

58

0

10

20

30

40

50

60

70

80

FH Vanhanen Polity Cheibub

Unitary states Hybrid unions Federal states

Note: The type of constitution was classified using the definitions defined in the text according to data derived from Griffiths (2005), Watts (1999), and Banks (2004). The standardized 100-point scales of democracy are described in Table 3.1. The four scales measure Liberal Democracy (Freedom House 2000), Constitutional Democracy (Polity IV 2000), Participatory Democracy (Vanhanen 2000), and Contested Democracy (Cheibub and Gandhi 2000). When tested by ANOVA, the difference between mean scores are all significant (at the p=.001 level).

FEDERALISM STRENGTHENS DEMOCRACYLiberal democracy Constitutional democracy

Freedom House Polity IV

b pcse p. b pcse. p.

INSTITUTIONSPR Electoral system 4.30 (.949) *** 10.54 (.530) ***

Parliamentary monarchy 11.68 (.569) *** 18.74 (1.17) ***

Federal constitution .70 (.222) *** 1.60 (.204) ***

CONTROLSLog GDP/Capita (US$) 11.46 (.979) *** 7.75 (.737) ***

Ex-British colony (0/1) 9.27 (.627) *** 9.66 (1.14) ***

(0/1) -13.33 (1.88) *** -16.94 (1.53) ***

Regional diffusion of democracy .59 (.052) *** .621 (.039) ***

Ethnic fractionalization (0-100-pt scale) -9.78 (.634) *** -2.40 (1.48) N/s

Population size (thou) -.000 (.001) *** -.001 (.001) N/s

Area size (sq.miles) .001 (.001) *** .001 (.001) ***

Constant -14.76 -7.45N. observations 5125 4221N. of countries 187 156Adjusted R2 .513 .560

5. CASE-STUDIES

CASE STUDIES: INDIA V BANGLADESHSocial and economic indicators India Bangladesh

Area 3,287,590 sq km 144,000 sq km

Pop., 2007 1.13 bn. 150.4m

Pop below poverty line (%) 25% 45%

GDP per capita (PPP US$), 2006 $3,700 $2,200

Life expectancy at birth, 2003 68 years 63 years

Human Development Index, 2003 .501 .600

Adult literacy (% of pop. 15+), 2003 59% 43%

Ethnic fractionalization, 2002 (Alesina) .418 .045

Political indicators

Year of independence (from) 1947 (Britain) 1971 (W. Pakistan)

Liberal Democracy (Freedom House) Index, 1973

Freedom House classification 1973

2.5

Free

3

Partly free

Liberal Democracy (Freedom House) Index, 2007 2.5 4

Freedom House classification 2007 Free Partly free

Control of Corruption (Kaufmann) 2005 47 8

Government effectiveness (Kaufmann) 2005 52 21

Political stability (Kaufmann) 2005 22 7

Rule of Law (Kaufmann) 2005 56 20

Voice and accountability (Kaufmann) 2005 56 31

Regulatory quality (Kaufmann) 2005 41 15

INDIAN STATES

INDIAN FEDERALISM & DECENTRALIZATION Federal Republic; 1947 Indian independence; 1950 new Constitution: Mixed Executive: Elected President Pratibha PATIL, Prime Minister

Manmohan SINGH Lok Sabha (545 MPs, first-past-the-post simple plurality) Pop 1.1 bn (country 1/3rd size of US) Religions: Hindu 80.5%, Muslim 13.4%, Christian 2.3%, Sikh 1.9%, other 1.8% Languages: Hindi 41%, Bengali 8.1%, Telugu 7.2%, Marathi 7%, Tamil 5.9%,

Urdu 5%, Gujarati 4.5%, Kannada 3.7%, Malayalam 3.2%, Oriya 3.2%, Punjabi 2.8%, Assamese 1.3%, Maithili 1.2%, other 5.9%

Federalism: Divided into 28 states and 7 union territories First-past the post elections for legislative assemblies, states vary in size by pop. Asymetrical federalism: special provisions for Jammu and Kashmir

Decentralization: 1992, the 73rd amendment strengthened rural and village councils (panchayats), new powers and funding, women must hold at least one-third of the seats on these bodies.

BRAZIL, JAPAN, RUSSIA AND SWEDEN Ref Andrews and de Vries Decentralization is a common policy among

international agencies Decentralization is usually assumed to enhance citizen

empowerment, allocation efficiency and decision-making.

Yet many negative consequences, one size does not fit all, context matters, impact on popular participation varies

‘Most different’ research strategy: Brazil, japan, Sweden and Russia

See Table 1 and Fig 1

CONTEXT MATTERS?

DIVERSE CASES: ANDREWS AND DE VRIES

SURVEY EVIDENCE

EFFECTS

CONCLUSIONS: ANDREWS AND DE VRIES

GENERAL CONCLUSIONS

1. Diverse types of federations and forms of sub-national decentralization; not equivalent

2. Decentralization growing (political, administrative and fiscal) but federalism is more difficult to change

3. Federalism usually strengthens democracy4. Complex to analyze the other types of effects5. Many conditions probably matter in plural societies,

including the boundaries drawn across or within ethnic communities, and types of parties.

6. Pros and cons?

NEXT CLASSInnovative forms of public participation and transparency