Contradictions and Constraints in Chile's Health Care and Education Decentralization.pdf

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1/32

Contradictions and Constraints in Chile's Health Care and Education DecentralizationAuthor(s): Mary Rose Kubal

Source: Latin American Politics and Society, Vol. 48, No. 4 (Winter, 2006), pp. 105-135Published by: Distributed by Wileyon behalf of the Center for Latin American Studies at theUniversity of MiamiStable URL: http://www.jstor.org/stable/4490494.

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2/32

Contradictions

nd Constraints

n

Chile'sHealth Care and

Education

Decentralization

Mary

Rose Kubal

ABSTRACT

Proponents

of

social

service

decentralization

ften claim

that trans-

ferring

ervice

administrationo lower

levels of

government

acili-

tates increases

citizen

participation

nd

governmental

ccountabil-

ity

while

improving

allocative

efficiency

and

equity

in service

distribution.Usingthe cases of healthand educationdecentraliza-

tion

in

Chile,

this

article

evaluateswhether

and under

what condi-

tions

social

service

decentralization

rograms

are

likely

to deliver

on

these

promises.

It discusses

the tensions

between

equity

and

efficiency

goals

and how

these

may

play

out

given

different

accountability

mechanisms n

local

public

choice,

principal-agent,

and

real-world

hybrid

ecentralization

models. The

case studies

illustrate

he

difficulty

of

balancing

he

need for central

standards

and

funding

with

local

autonomy,

but

suggest

that

accountability

mechanisms hat

emerged ollowing

Chile's

ransition o

democracy

in

1990

ed to

improvementsn bothequityandefficiency

n

decen-

tralized ervice

administration.

As

Latin

American

countries

struggle

to democratize

their

political

institutions while

pursuing

market-oriented

economic

strategies,

international financial

institutions have

encouraged

decentralization

as

an

administrative and

political strategy

for

rationalizing

the

two

processes.

If

properly

designed,

proponents

posit,

decentralization

measures

may

facilitate

increased citizen

participation

and

governmen-

tal accountability while improving allocative efficiency and equity in

service

distribution

(Agrawal

and

Ribot

1999, 473;

IDB

1994;

Litvack

et

al.

1998;

Peterson

1997).

In

addition,

international

lending

institutions

and

government

technocrats have

promoted

administrative

and fiscal

decentralization as a

means

of

providing

public

services

in

order

to

relieve

the

growing

financial burdens

on

central

treasuries

and

to

reduce

high

levels of

public

employment

(Rondinelli

1989,

77;

see

also

IDB

1994).

In

theory,

improved efficiency

and

central

budget

cuts make

free

market reforms economically sustainable; participation, accountability,

and

equity

make

market reform

politically

sustainable

by creating

stake-

holders,

as well as

deepening

democracy

or,

at

the

very

least,

moving

a

country

toward

good governance

(Graham 1998).

Using

the cases

of

105

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3/32

106

LATIN

AMERICAN

OLITICS

AND

SOCIETY

48: 4

health

and

education

decentralization

n

Chile,

this

article

evaluates

whether

and under

what

conditionssocial

service decentralization

ro-

grams

are

likely

to

deliver

on

these

promises, particularly

n

terms

of

improvements

n

equity,

efficiency,

and

government

accountability.

A

number of

scholars

have

attempted

to outline

the

optimal

arrangements

or social

service

decentralization-especially

in the area

of

fiscal

federalismand local

public

choice

(Bennett

1990;

IDB

1994;

Lit-

vack et

al.

1998;

Peterson

1997;

Rondinelli

1989).

These

analyses

focus

on

administrative

nd fiscal

decentralization

nd

normallyemphasize

theoretical

gains

in

efficiency.

They

often

acknowledge,

but fail

to deal

adequately

with,

the

potential

trade-off

between

efficiency

and

equity

goals. Otherauthors have identifiedpoliticaland institutional actors

that

encourage

or

discourage

decentralization

Murillo

1999;

O'Neill

2003;

Williset al.

1999)

and influencethe

design

and

implementation

f

decentralization

policy

(Eaton

2001, 2004;

Garman

et

al.

2001).

These

studies

focus

on

the

political goals

of decentralizers

and

help

predict

when and to what

degree

decentralization

an be

expected.

They

paint

a more

complex picture

of the interactionbetween

decentralization

nd

the

political process

in

developing

countries,

but

they

often

focus on

decentralization

utcomes in

terms

of

the

balance

of

power

and

respon-

sibilitiesbetween levels of government,ratherthan policy outcomes,

such as

equity

and

efficiency.

This

leaves a numberof

questions.

What

happens

to

accountability

when

central

politicians

and

administrators

maintain control

over

dimensions of

decentralized

ervices,

such

as

funding,

oversight,

and

evaluation,

but local

officials

are

subject

to electoral

and exit

pressures?

Is it

possible

to

balance the need for

central tandards

nd

funding

with

local

autonomy

and

accountability?

What

are

the

implications

or

equity

and

efficiency

n

service

delivery?

Recently,a numberof quantitative,ross-nationaltudieshaveiden-

tified

factors

exogenous

to

decentralization

olicy,

such as

regime

type,

that

help

to

explain

equity

outcomes

in

the social

sectors. The

findings

suggest

that

political

democratization,

ven

in the context

of

market

reform,

has

a

positive

impact

on

aggregate

levels

of social

spending

(Brown

and Hunter

1999),

or

at least results

in increased

spending

(Huber

et al.

2004;

Kaufman

nd

Segura

2001)

and levels

of

service

pro-

vision

(Brown

1999;

Lakeand Baum

2001)

in the

health

and education

sectors. While

these studies do

not consider

decentralization

rrange-

ments as explanatory rcontextualvariables, heyraisequestionsabout

the

significance

of

such

arrangements.

Primarily,

ow

do factors

other

than

funding

levels-such

as

the

way

financing

is

allocated and

... how

delivery systems

are

organized

(Kaufman

and

Segura

2001,

581)-shape policy

outcomes?

The

case studies

of Chilean health

and

education

decentralization offer some tentative

answers.



4/32

KUBAL:

CHILE'SDECENTRALIZATION 107

Given

the limits

of

a

one-country

study,

this articledoes not

set out

to

present

and test a

comprehensive

xplanation

or

decentralized

ocial

sector

outcomes.

Instead,

t

explores

the

implications

or

equity

and

effi-

ciency

outcomes that often are not addressedin the literatureon the

politics

of

decentralization.

n

doing

so,

it

contributes

o

the

literature

on

social

service

decentralizationand fiscal

federalism

by examining

two

cases of

hybrid

ecentralization,

omparing

ideal

ype

models

with

real-world

policies

and

exploring mplications

or

efficiency-equity

trade-offs

and

accountability

mechanisms.

Furthermore,

t

helps

to

answer

questions

raised

by

cross-national,

uantitative

tudies

by

iden-

tifying

accountability

mechanismsthat

affected

the distribution

of

the

additional unds allocated to the health and education sectorsin Chile

following

the

democratic

ransition.

Decentralizationn

Chile

was

initiated

n

1980

under

military

ule,

and it

continuedafter he

transition o

democracy

n

1990.

The variation

in

regime

type

allows

for an

exploration

of

conditions associated

with

democratization,

mainly

increased electoral

accountability,

that

are

hypothesized

to

affect social

policy

outcomes.

In

other

Latin

American

countries,

ocial

servicedecentralization

ften

coincided

with democratic

transitions,

or,

as in

Colombia and

Venezuela,

there

was

no

regime

change. Health and educationdecentralizationn Chilebegan almosta

decade

before

similar reforms

n

the

region,

and

the Chilean

reforms

have

been

held

up

as

a

model

(Delannoy

2000;

DB

1994;

Wiesner

2003).

The

first

consideration

s

the

tensions between

equity

and

efficiency

goals

and

how

they may play

out,

given

different

accountability

mecha-

nisms in

local

public

choice,

principal-agent,

nd

hybrid

ecentraliza-

tion

models. This

discussion

takes into account

contextual

variables,

such as

regime

type

and

government

deology,

which are

likely

to

shape

the

functioning

of

decentralized

ervicesand

thus,

policy

outcomes.

This

frameworks appliedto health and educationdecentralizationn Chile

with

a focus

on how

the initial

arrangements

hatwere established

under

the

Pinochet

dictatorship

were

(and

were

not)

altered

ollowing

the tran-

sition to

democracy

and

how

this

shaped

policy

outcomes.

Changing

lines of

accountability

n the

decentralized

ectors,

along

with

increased

funding

due

to

factors

exogenous

to the decentralization

rocess,

helped

improve

service

equity

and

quality,

and in some

instances,

efficiency.

THREEDECENTRALIZATIONODELS

Before

turning

to

the Chilean

cases,

it is useful

to

establish

how differ-

ent models

of

social service

decentralization

might

be

expected

to

improve

the

efficiency

and

equity

of

service

delivery

along

with increas-

ing

government

accountability.

These

particular

social

policy

outcomes

are

highlighted

for three related

reasons.

Proponents

of social

service



5/32

108 LATIN

AMERICAN OLITICSAND

SOCIETY

48:

4

decentralization ften

focus their

claims

on

these

areas

(as

do theircrit-

ics).

These

outcomes affect

people's

everyday

lives

in terms of

being

able to

access crucial

services such

as

health

care and education

and

having

avoice in matters hat

directly

affecttheir

quality

of life. At

times,

the

mechanisms

chosen to

achieve these

goals may

create

contradic-

tions within

the

decentralization

rocess

and constrain

he

achievement

of the

desired outcomes.

Decentralization

efers to a

variety

of

administrative, iscal,

and

political

changes

that involve

the transfer

of some combination

of

resources,

responsibilities,

r

decisionmaking

uthority

rom

the

central

government

o

lower-level

units,

be

they

subnational

overnments,

units

of the centralgovernment,orstate-ownedenterprises.Thismayinvolve

deconcentration

f

functions o

subnational

units of the

centralbureau-

cracy,

delegation

of

responsibility

to lower-level

actors

upwardly

accountable

to the central

government,

or devolution

of decisionmak-

ing,

financial,

and

managementauthority

o

lower levels

of

government

(which

may

or

may

not

be

downwardly

ccountable

o local

residents)

(Agrawal

and

Ribot

1999, 475;

Rondinelli

1989,

85).1

Decentralization an

furtherbe

categorized

n terms

of the substan-

tive area

being

reformed.

For

example,

Willis

et al.

(1999,

8)

define

political decentralizationas the establishment r reestablishmentof

elected autonomous

subnational

governmentscapable

of

making

bind-

ing

decisions at least in

some

policy

areas.

They

differentiate

his from

what

they

term

functional

ecentralization

r the transfer

f

policy

responsibilities

nd

expenditure

and

revenue-raising

owers

Willis

et

al.

1999,

8).

Social

service

decentralization

necessarily

involves

func-

tional

decentralization

ut,

as

in

the

Chilean

cases,

may

be achieved

in

the

absence of

political

decentralization

hrough

the

delegation

of

responsibilities

o

upwardly

accountable ocal

administrative

nits.

The two most common decentralizationmodels advocatedby the

internationalinancial

nstitutions,

ocal

public

choice

(LPC)

and

princi-

pal-agent

(P-A),

roughly

correspond

to devolution

and

delegation,

respectively.

In the LPC

model,

services are

locally

funded

and

locally

provided. Accountability

s

ensured

by

consumer

choice:

citizen-con-

sumers

vote with their feet

by

moving

to localities

that

offer their

pre-

ferred tax

service

package

(Tiebout 1956).2

The threats

of

exit

resi-

dents

moving

out

of

the

locality)

and voter

backlash

orce

local officials

to

formulate

policies

that

respond

to

constituent-consumer

emands.

Individualsrecognize that they getwhat they pay for (and pay for

what

they

get),

thus

preventingoverconsumption

nd

encouraging

effi-

cient resource allocation.

According

to this

logic,

continued central con-

trol over

resources undermines

efficiency

because fiscal

correspon-

dence,

the

connection between service

provision

and the

origin

of

the

funds

to

pay

for those

services,

is broken.



6/32

KUBAL:CHILE'SDECENTRALIZATION

109

The

public

choice

model,

with

its focus

on

allocative

efficiency,

assumes

that service

demand

across

local

jurisdictions

aries

mainlyby

tastesor

preferences

rather

than income

(Prud'homme

1995,

208).

Achieving

allocative

efficiency,

however,

is not a

primary

concern,

at

least for

the

majority

without

the resources o

exit,

n

countrieswhere

the tax

base

in

many

localities is

not sufficient

to

cover even minimal

service

provision.

Without

centralredistributive

mechanisms,

nequality

between

jurisdictions

ncreases

due

to

the variation

n local tax and

serv-

ice levels

that

theoretically

acilitates

efficiency

(Wolman

1990,

36).

A

trade-off

emerges:

central

ntervention o

improve

equity upsets public

choice

incentives,

and

efficiency

s

sacrificed

L6pezMurphy

t al.

1995,

14). Some analysts posit thatorganizedparticipation f poor residents

at

the local

level and the

targeting

of limited

resources

toward

those

individuals

and

communities

most

in

need can

increase

equity

in decen-

tralized

service

delivery

without

sacrificing

efficiency

(Graham

1998;

IDB

1994,

194-95;

Litvack t

al.

1998,

8).

In

addition

o

equity

concerns,

centralofficials

may

limit ocal fiscal

autonomy

because

they

believe that macroeconomic

stabilization

requires

central

control over

tax and

spending

levels.

They

cite

exam-

ples

such

as

the

contribution

of the

provincial

debt to the 2002

Argen-

tine fiscal meltdown. Accordingto analysts from the Inter-American

Development

Bank and

the

World

Bank,

national

governments

can use

a

principal-agent

model

of

decentralizationo create

ncentive

structures

that

encourage

efficient

resourceadministration

t the

local

level while

maintaining

entralcontrol

over resourceallocation

and

technical

over-

sight

(IDB

1994;

Litvack t al.

1998).

Rather han

being

held accountable

by

local

residents,

local

officials are

upwardly

accountable

to central

authorities.

Thus,

citizen

participation

that

is,

demand for increased

service

levels)

threatensthe

efficient

operation

of a P-A model

when

localauthoritiesare accountable o the principal centralgovernment]

and not to

the local

taxpayer

or voter

IDB

1994,

181).

The risk is that

such

arrangements

will

decrease incentives for

efficient

local adminis-

tration

by

allowing

local

officialsto blame the center

for

poor

services

and

use

political

pressure

to extract additional

resources.

Upward

accountability

lso

decreases the effectiveness

of

poor

residents'

organ-

ized

participation

t the local

level-one

of

the

proposed

mechanisms

for

overcoming

he

equity-efficiency

rade-off.

In

Latin

America,

hybrid

ecentralization

rrangements ombining

elements of both LPCand P-Amodels are common. Nationalgovern-

ments

maintain

a

role

in

various dimensions

of

decentralized

ervice

provision,

including

funding,

policymaking,

oversight,

and

program

evaluation,

while

local residents are

encouraged

to

hold local officials

accountable

through

their

choice of

local

services

and their choices at

the ballot

box. The

literature on the

politics

of decentralization

policy,



7/32

110

LATIN

AMERICAN OLITICS

AND SOCIETY

48:

4

with its

focus

on

the

dynamics

of center-subnational

ower

relations,

suggests

several reasons

for

the

emergence

of such

hybrid

arrange-

ments.

Recent

research

has

emphasized

the incentives

created

by

lines

of

accountability

within

politicalparties

Garman

t al.

2001;

Williset al.

1999).

In

countries

where

national-level

politicians

control

nominations

and make

party policy,

such

as

Mexico,

it is

unlikely

that

power

and

resourceswill be

handed down to

the state

or

local

level

with no

strings

attached.

In

countries

where subnational

politicians

have a voice

in

party

decisions,

such as

Brazil,

a

higher degree

of

devolution

can

be

expected.

Additionally,parties

that

expect

to lose control

over national

political

institutions

but maintain

support

at the subnational

evel

(see

O'Neill2003)and individualnational-levelpoliticianswho expect to run

for

subnational

office

in the

future

(Samuels

2000)

may

reasonably

be

expected

to

devolve

significant

autonomy

and resources.

As

long

as these

politicians

or

partiesexpect

to hold on to

national-

level

positions,

central

officials

will

generally

oppose,

or exhibit

an

ambivalent

ttitude

oward,

he decentralization

f

political

power

and

resources

o lower levels of

government

Eaton

2001;

Williset al.

1999).

National

executives

and

legislators

are

therefore

likely

to formulate

hybrid

decentralization

rrangements

which

correspond

neither o

pure

LPCnor to P-Aforms).Sucharrangements llow themto take credit or

improvements

n

efficiency

and

governance

while

maintaining

s much

controlover

resourcesas

possible

and

avoiding

responsibility

or

prob-

lems

relatedto

poor

service

delivery.

This

clearly

poses

a

challenge

to

efficient

service

administration,

as lines

of

accountability

become

blurredand

important

lements of service

delivery

may

be

neglected

or

duplicatedby

central

and

subnational

bureaucrats

as

Eaton2001 docu-

ments in the

case

of

the

Philippines).

The

tendency

to

establish

hybrid

forms

of social

service decentral-

ization s reinforcedby the demandsof publicsectorunions,whichgen-

erally oppose

decentralization.Union

leaders

can

be

expected

to

push

for

decentralization

rrangements

hat

guarantee

heir

right

to

negotiate

salary

evels and

working

conditions

with

central

officials,

thus

limiting

local

control

over

decentralized

ersonnel.

Centralized

unions

with

large

memberships,

eachers'unions in

Chile

and

Mexico,

for

example,

are

likely

to

negotiate

such

arrangements.

Weak

or

fragmented

unions

and those

that do not

have the

political support

of

central

politicians,

such

as

teachers'

unions

in

Nicaragua

and

Argentina,

are less

likely

to

influencedecentralizationutcomes(Gershberg 999;Murillo1999).Yet

even

where

teachers'

unions

fail

to

maintain centralized

bargaining

arrangements,

it is common

for national education

ministries to

main-

tain

or even

increase

involvement

in

education

policy

development

and

oversight

following

the

decentralization of school

administration

(Gersh-

berg

1999;

Gorostiaga

2001,

562).

This is

largely

because,

like central



8/32

KUBAL:CHILE'SDECENTRALIZATION

111

politicians

and

public

sector

unions,

centralbureaucrats

ave a stake

in

decentralization

rrangements.

In

addition

to

partisanmaneuvering,

the

struggle

to maintain

or

expand

bureaucratic

prerogatives

affects lines

of

accountability

n the

decentralized

sectors. Central

ministries

commonly

have

conflicting

objectives;

for

example,

health and

education

ministry

officials

con-

cerned

with

improving

ervice

quality

and

preserving

heir own

bureau-

cratic

prerogatives

will

conflict

with finance

ministry

officials

preoccu-

pied

with

macroeconomic

tability

and

limitingspending.

Beneath this

layer

of

conflict,

subnational

governments

are

likely

to

have

difficulty

asserting

control

over

decentralizedhealth clinics and

schools,

espe-

cially fhealthandeducationministry fficialsmaintain noversightrole

(which

is

usually

the

case).

Service

providers

face

one

more

layer

of

bureaucracy

and

may

feel that

municipal

or

regional

officials

are less

familiar

with their

problems

than

central

ministry

functionaries.

Still,

local

health

providers

and teachers

may align

themselves

with

local

offi-

cials

to

demand

more

resources romthe central

government.

This

type

of

politickingupsets

efficiency

outcomes

in

both the local

public

choice

and

principal-agent

ecentralizationmodels. In

the

former,

entral

rans-

fers

would

threatento

underminefiscal

correspondence;

n the

latter,

efficiencytargetsestablishedby centralplannersneed to be protected

from

demands of

their

subnational

agents.

Yet

if

subnational

actorsdemand

transparency

nd

equity

from

cen-

tral

politicians

and

bureaucrats

instead

of,

or in addition

o,

pork

barrel

transfers),

hey

may

introduce

an

additional ource of

vertical

ccount-

ability,

nverting

he

upward

accountability mphasized

n

the

P-Amodel

and

distinct rom

the

downward

accountability

ey

to the

functioning

of

the

LPC

model. This

vertical

accountability

s similar o

the

horizontal

accountability

described

by

O'Donnell

(1996,

44)

as

the

controls

that

stateagenciesaresupposedto exercise over other stateagencies, but it

involves

subnational

actors'

calling

centralactors

to

account,

and these

subnational

actors

may

or

may

not

have

legal authority

o

sanction

their

central

counterparts.

Local officials

may

work within

their

parties

or

through

nonpartisan

municipal

and

regionalgovernment

associations

o

hold

central

officials

accountable or theirside of

the

bargain.

Of

course,

central

officials

interested

in

claiming

credit for

improvements

n

the

functioning

of

decentralized

services also have incentives

to

follow

through

and hold

subnationalofficials accountable

or efficient service

administration.Both central and subnational officials have a greater

incentive

to

guarantee

mprovements

n

quality

and

equity

of

decentral-

ized

services

when

they

are

subject

to electoral

pressures.

Thus

the

larger political

context,

particularly

regime type

and

gov-

ernment

ideology,

will

affect both lines of

accountability

in

and levels

of

funding

to

decentralized service sectors. The

findings

of the

quantitative,



9/32

112

LATINAMERICAN OLITICS

AND

SOCIETY

48:

4

cross-national tudies cited

above

suggest

that

regardless

of administra-

tive

arrangements,

emocratic

egimes

are

likely

to

allocate

more

funds

to health

and

education

than their

authoritarian

ounterparts.

Lake

and

Baum

(2001)

argue

that

democracy

contributes

o increasedlevels of

health and

education

provision

because

political competition

and

the

low

cost

of

participation

imit

politicians'

ability

to seek rents

at the

expense

of

public

service

delivery.

Brown

1999)

posits

that

elected

offi-

cials

perceive increasing

primary

chool

enrollment

as

an

effective

way

to

expand

heirelectoral

base,

hus

explaining

his

finding

that

among

low-income

countries,

enrollment s

significantly

igher

n democracies.

Kaufman nd

Segura

2001,

583)

speculate

that

electoral

considerations

mayexplain why democraticpoliticians n LatinAmerica eem less will-

ing

than their

authoritarian

ounterparts

o cut

health

and education

spending. Puttinggreater

emphasis

on

government

deology,

Huber et

al.

(2004,

6)

find that

democracy

correlates

with

increased

health

and

education

spending

levels in

LatinAmerica

because

it

allows for

the

emergence

and consolidationof

political

parties

representing

he

inter-

ests of

the

underprivileged.

Their

analysis

shows

that

spending

increases

with

left and

center-left

majorities

n the

legislature.

Whether

or not

greater

national

government

nvestment

n health

and education will improveequity outcomes in decentralizedservice

sectors

depends

partly

on

accountability

mechanisms

n these sectors.

The

following

case

studies

suggest

that

where central

officials

maintain

control over

resource

allocation,

he

emergence

of vertical

accountabil-

ity

mechanisms

n

the context of democratization

an create

incentives

for

equitable

distribution.

Still,

even the most

skillful

democratic

politi-

cians

and administrators

ave to

weigh

efficiency

and

equity

outcomes

as

they design

and

modify

decentralization

rrangements.

n

Chile,

the

transition o

democracy

did

not resolve

the internal

contradictions

of

decentralization rograms,but insteadchangedthe politicalcontext in

which

these were

played

out

at

the national and

local levels

and

in

administrative

nd

political

arenas.

HEALTH

AND

EDUCATION

DECENTRALIZATIONN

CHILE

Social service

decentralization in Chile

was initiated

in

1980,

under

authoritarianule,with the transferof the firstpublicschools to munic-

ipal

administration;

he

first

primary

health

care clinics

were

transferred

in

1981.

Although

he

rhetoric

urrounding

ealth

and education

decen-

tralization

emphasized

choice and market

mechanisms,

the

military

model more

closely

followed

principal-agent

lines,

with administrative

responsibilities

deconcentrated to

centrally

controlled

municipalities,

continued central

oversight,

and

extremely

limited fiscal

autonomy.



10/32

KUBAL:

HILE'S

ECENTRALIZATION

113

Additionally,

consistent with

the

findings

of the

quantitative

studies

noted

earlier,

unding

for

health and education

was cut

by

the

right-

wing

military egime,

which

pursued

a marketreform

agenda,

thus

hurt-

ing

equity.

In

the

1990s

and

2000s,

elected

center-left

governments

ncreased

health and

education

funding

and

emphasized equity

and citizen

par-

ticipation

n service

delivery.

Despite

improvements

under

democracy,

some

of

the

old

contradictions

proved

difficult

to

resolve.

Tensions

between

municipal

and

centraladministrators

nd

politicians

ncreased,

and to

some

extent,

lines

of

accountability

became

blurred,

but the

return o

municipal

autonomy

and elections

generated

new accounta-

bilitymechanisms hatimprovedboth equityand efficiency.

DECENTRALIZATION

NDER

MILITARY uLE:

MUNICIPALIZATION

ND

ITS CONTRADICTIONS

In its

rhetoric,

the

military dictatorship

headed

by

General

Augusto

Pinochet

(1973-89)

was

committed

to

implementing

a

decentralization

program

based

on

public

choice

assumptions.

Pinochet

cast his

lot with

a

group

of

neoliberal

technocrats

known as

the

Chicago Boys.

While the

Brazilian

military

regime

was

investing

in

huge,

state-led

development

projects,

in

Chile there

was

massive

privatization

of

state-owned

enter-

prises

as reformers

attempted

to decrease the

level of state

intervention

in

the

economy.3

The

decentralization of

social service

administration

facilitated

this

state-shrinking

genda

by reducing

central

funding

for health

care and

education and

setting

the

stage

for

eventual

privatization.

Fiscal

devo-

lution was never

considered,

however,

and the

Chicago

Boys

main-

tained

central

authority

over

tax

policy

and

severely

constrained

local

autonomy

in

spending

decisions. With

municipal

officials

accountable

to

the

military

government

rather than

to local

populations,

and demo-

cratic

political participation

proscribed,

there

was

little

hope

for the

proper functioning

of a

local

public

choice

model.

In

reality,

the decen-

tralization mechanisms

implemented

more

closely

resembled

a

P-A

model,

with

continued

government

involvement

in

program

funding

and

oversight,

although

with

an element

of consumer

choice,

particu-

larly

in

education.

Decentralization rrangementslearlyreflected he military overn-

ment's

priority

of

decreasing

(or

eliminating

through

privatization)

spending

on social

services. The

1979

New

Municipal

Revenue

Law

ini-

tiated health care and

education decentralization

in

Chile.

It created

a

Common

Municipal

Fund

(Fondo

Comtin

Municipal,

FCM)

to assist

the

municipalities

in

creating, maintaining,

and

providing

services

to local

communities.4

The authors of this

legislation

intended

the increase

in



11/32

114

LATIN

AMERICAN OLITICSAND SOCIETY 48:

4

municipal

revenue to be

spent

on

newly

transferred

services,

such as

health care

and education. The

enabling

legislation

for the

municipal

revenue law

specified

that the

amount of

central funds

accompanying

the

transferred services

could

not

exceed

the amount

spent during

the

year

prior

to the transfer.

Any growth

in

spending

would

have to

come

from the

municipalities.

The

transfer

of

administrative

responsibilities

to the

municipalities

was seen as an intermediate

step

toward

privatization.

As

the

architect

of health care

decentralization

put

it,

To the extent that

it

was

possible

to

decentralize health care

administration,

it was easier to make it com-

petitive

with the

private

sector and this would facilitate

a

gradual

trans-

fer of state actions to private actions in the future (Hernfin Bichi,

quoted by

Duarte

1993,

298).

Education decentralization

actually

involved an

element of

privatization.

Parents

were

given

the

option

of

sending

their children to either

municipal

or state-subsidized

private

schools.

(Each

school received the

same

central

subsidy

per

student

enrolled).

More than a thousand new

subsidized

private

schools

were

established in

the first five

years

after the

reform,

with

2,643

operating

in

1985,

compared

to

1,627

in

1980

(Montt

and Serra

1994,

13).5

Policy-

makers

hoped

that

those

schools and clinics that could not be

privatized

would operate more efficiently as a result of new incentives for com-

petition

(subsidies

were allocated on the

basis

of students enrolled

and

number of

medical services

provided).

Funding

for the

transferred schools and clinics came

from two

main

sources: a

subsidy

from

the central

government

to

cover

operating

costs

(violating

the LPC

assumption

of fiscal

correspondence)

and

municipal

investment

in

infrastructure. In

reality,

the

municipal

contribution

went

to cover the

operational

deficit left

by

insufficient

central

governmental

funding

(Carciofi

et

al.

1996, 98, 107;

Friedmann

1995,

78).6

Local

sources of revenue, mainly driver permit and commercial license fees,

were

minimal,

and

significant

only

in

wealthy

urban areas with

sub-

stantial

commerce;

redistribution

through

the

new

FCM,

although

rep-

resenting

a

step

toward more

equitable

funding,

did not

provide

enough

resources

to

ensure local fiscal

autonomy.

Meanwhile,

the value

of cen-

tral transfers to

municipalized

clinics decreased

by

more than

30

percent

between

1982

and

1986

(Carciofi

et al.

1996,

127).

The trend for educa-

tion was

similar.

During

the

1982-83

recession,

the

government

dein-

dexed the

subsidy

levels

from the inflation

rate,

causing

a decline in the

real value of transfers for primaryeducation of 26 percent and a 30 per-

cent decrease for

secondary

education

from

1981 to

1985 (Carciofi

et al.

1996,

98).

The actual

transfer

of

schools

and clinics occurred

by way

of a

con-

tract

(convenio)

signed

by

the

mayor

(at

that

time

appointed

by

General

Pinochet)

and

the relevant

central

government ministry

or

public

entity.



12/32

KUBAL:

CHILE'SDECENTRALIZATION

115

The

ministriescontinued

to

transmit

policy

goals

and

programs

o the

local

level and to

supervise

program

implementation.

Mayors

were

responsible

or

overseeing

day-to-dayoperations,

ncludingbudget

allo-

cationsand

personnel

decisions.

Essentially,

municipal

officialsreceived

central

mandates

concerning

the

programs

o be

implemented

in

the

schools and

clinics,

and were

responsible

or

hiring

and

overseeing

edu-

cation and health

personnel

to

carry

out

those

mandates,

all

on

a

budget

determined

by

the

value of

central

government

ransfers.

Mayors

ould,

in

theory,

raise doctors'

and

teachers'

salaries

to

compete

with

other

municipalities

and

private

providers.

In

reality,

to do

this,

they

would

have to

contributescarce

municipallygenerated

fees.

As a

municipal

functionaryobserved in the mid-1980s, thegovernmentalministries

(health,

education)

transfer

esources to

the local

level,

oversee

these

resourcesand enforce

the

completion

of technical

norms.There is

a lot

of

rigidity

....

This

discourages

ocal

initiative

quoted

by Raczynski

and Serrano

1987,

141).

Thus

potential

efficiency

gains

from

ocal

choice

were undercut

by

continued

central

mandates.

Because local

financing

was

necessary

to

make

up

the deficit

in

central

transfers,

municipalization

ed to

increased

disparities

n health

and education

spending. Despite

the

redistribution

f income

through

the FCM,poor municipalitieswere unable to contributethe same

amount of resources

in

absolute terms

(not

as a

percentage

of their

budget)

to

fund schools and

clinics.

Additionally,

lack

of

transparency

in

settingsubsidy

levels resulted n

funding

some

municipalities, ener-

ally

wealthier ocalitieswhere

supporters

of the

military

egime

ived,

at

higher

ratesthan

other,

often

poorer

areas

(Duarte

1995,

307-12).7

Official

figures

on

municipal

spending

were

not

kept

during

the

militaryregime.

A

survey

conducted

in

Santiago

in

1982,

however,

revealed

great disparities

n

education

spending

between

wealthy

and

poormunicipalities.Thedifferencewas apparent nteachersalary evels

and

expendituresper

student.

One

wealthy

municipality,

Providencia,

spent

1,657

pesos monthlyper

student,

while

Renca,

a

poor

municipal-

ity,

spent

813

(Parry

1997,

115).

In

1990,

the

first

year

for which

official

figures

are

available,

the 10

percent

of

municipalities

with the

lowest

revenue

per capita spent

an

average

of

2,660

pesos

per

student,

while

the 10

percent

with the

highest

revenue

per

capita

spent

42,080

(Parry

1997,

116).

In

the same

year,

the 20

percent

of

municipalities

with the

least

revenue

per capita

spent

an

average

of

87

pesos

per

month

on

health clinicusers,and those municipalitiesn the top quintilespent489

pesos

(for

both

groups

this

represented

4.2

percent

of

municipal pend-

ing)

(Duarte

1995,

312).

Despite adding

an

element of local

choice,

funding

mechanisms

created

perverse

incentives

that hurt

efficiency.

The

funding

mechanism

for

health

clinics,

which

were reimbursed

for

each service

provided,



13/32

116 LATIN

AMERICAN

OLITICS

AND SOCIETY

48:

4

resulted

n

serious

productive

and

potentially

allocative)

nefficiency.

t

encouraged

the

clinics to

provide

unnecessary,expensive

services and

discouragedlow-priced,

often

preventive

measures,

such as

inocula-

tions. Thisdecreasedthe

quality

of care for

patients,

who were rushed

through

appointments

and often submitted

o

unnecessaryprocedures.

The

quasi-voucher

unding

system

for education

presented

efficiency

problems

because

parents

lacked sufficient information

about

their

choices

(such

as

school

test

scores),

and the

private

subsidized

schools

could

deny

students

entry,

leaving

difficult

students

to the

municipal

schools.

Competition

did

not

necessarily

ncrease

the

quality

of educa-

tion,

because

private

schools focused

on

status

lements

like

fancy

names(preferablyn English)anduniforms.Bothprivateandmunicipal

schools

resorted

o

practices

uch as

grade

inflation o

maintain tudent

enrollment

Carciofi

t al.

1996;

Gauri

1998).

The

quality

of

services also

declined

as

poor

working

conditions

and

low

salaries resulted in

a

shortage

of

physicians,

and teachers

worked

double

shifts

with

virtually

no

preparation

ime

(Collins

and

Lear

1995).

Once

a

municipality

assumed

control of

a

school or

clinic,

staff

members

signed

new

employment

contracts

with

the

municipality

under

the

terms of the

private

sector labor

code

(Cddigo

de

Trabajo).

These workers ost theirstatus as centralgovernmentemployees, elim-

inating

their

job

security,

opportunities

for career

advancement,

and

other

benefits,

such

as

administrative nd

maternity

eave

(Carciofi

t

al.

1996,

96;

Frank

2002,

40;

Heyermann

1994,

52).

Primary

health

care

workers,

in

addition,

were

cut off from the

rest of

the

public

health

sector

(hospitals

and

specialized

clinics),

further

hurting

heir chances

for

career

advancement.

Primary

are

physicians

could

no

longer

hope

for

more

prestigious

appointments

o

hospitals,making

jobs

in munici-

pal

clinics

much less

attractive.

By requiring

health care

and education

workers o negotiatewithmorethanthreehundredmunicipalitiesather

than

collectively

with

the

relevant

central

ministry,

he

military

egime

achieved its

not-so-publicized

oal

of

decreasing

he influence

of

public

sector

unions,

in addition

to

reducing

social

spending.

The failuresof

health

care and education

decentralization

uring

ts

first

decade-administrative

rigidity,

nequity,

ack

of

transparency,

nd

poor

design

of

funding

mechanisms-have

been attributed

o the

con-

straints reated

by

authoritarian

olitical

nstitutions,

articularly

he

lack

of

citizen

participation

Carciofi

et

al.

1996;

Heyermann

1994;

Marcel

1994). It is interesting hat while electoralpressuresdid increase the

accountability

f both

local

and

national

politicians,

community

partici-

pation

in the

decentralized services did not

emerge

in an

organized

and

sustained fashion at the

local level after the

transition.



14/32

KUBAL:

CHILE'SDECENTRALIZATION 117

DECENTRALIZATION

NDER DEMOCRACY:

RESOLVING

HE

CONTRADICTIONS?

Following

the

presidential

elections

of

1989,

the broad outlines

of the

military's

municipalization

program

remained

in

place.

President

Patri-

cio

Aylwin

(1990-94)

made it

clear that central

officials

had

no

interest

in

reassuming

responsibility

for

administering

health clinics and schools:

We

believe that

primary

health

care and

primary

and

secondary

edu-

cation

must

remain

at the

municipal

level. . .

.

The

serious

financial

problems

of

the

municipalized

health and education

systems

will

not

be

resolved

by

transferring

hese

services to the

[central]

tate

interview

in ElMercurio,November30, 1993,quoted by Heyermann1994, 47).

Equity

outcomes

improved

nevertheless

as the

posttransition overn-

ments'

deological

commitment o

growth

with

equity,

he

emergence

of

municipal

officialsas

watchdogs

ver central

policy

concerning

he

municipalized

ervices,

and

electoral

pressures

on both

centraland local

officials

facilitatedan

increase

in the level

of central ransfers

and their

more

equitable

distribution.

till,

democratization

id

not

resolve

all

the

contradictions

n

the

military's

ecentralization

model,

as

problems

with

administrative

igidities,

difficulties

creating

community

stakeholders,

and tensions within and across local and nationaladministrative nd

political

arenas

persisted,

constraining

progress

in terms

of

efficiency

and

equity.

Democratization

and

Changing

Lines of

Accountability

The first

three

posttransition

governments-all

from the center-left

Con-

certaci6n

coalition-wanted

to address the

social

debt left

by

the

Pinochet

regime,

but

without

returning

to the level

of

popular

mobi-

lization

before the

1973

military coup

or

endangering

the

military's

neoliberal

economic

project

(Garret6n

1994;

Weyland

1997).

The

post-

transition

preoccupation

with

achieving

growth

with

equity

led

to a

focus on

increasing

social

spending.

During

its first

year

in

office,

the

Aylwin

administration

egotiated

a tax increase

equivalent

to

2

percent

of

GNP,

which

was

spent

on

targeted

social

programs;

he health

care

and

education

budgets

rose

by

7

and

23

percent,respectively,

as

a

result

(Hershberg

1997,

352;

Weyland

1997).

Accordingto FinanceMinistry igures, centralgovernmentsocial

spending

increased,

on

average,

7

percent

annually

during

the decade

of

the

1990s,

for a

total

increase of

112

percent

(MIDEPLAN

d,

chap.

2,

sec.

1).

Central

redistribution

was made

possible by

a

period

of sus-

tained

growth

following

the

democratic transition.

During

the

1990s,

rising per

capita

GDP

was the

most

important determining

factor for

per

capita

social

spending

levels

in

Chile,

more

important

than the

level of



15/32

118

LATIN

AMERICAN OLITICSAND

SOCIETY

48:

4

public spending

relative o GDPor

the shareof

social

spending

in

terms

of

total

public

spending

(Mostajo

2000,

14-15).

Democratization

reated

incentives

for

the

posttransitiongovern-ments to

modify

the

decentralization

rrangements

nherited

from the

military

egime

in

ways

that

increased

the

central

government's

role in

terms of

funding,

oversight,

and

personnel

administration,

et

newly

autonomous

municipal

officials

were

able to

take

advantage

of

the

opportunities

fforded

by

the

democratic ontext

to

lobby

for increased

resources.

Increasedcentral

supervision,

guidelines,

and

funding

after

the

democratic ransition

elped

improve

he

quality

and

equity

of

serv-

ice

delivery,

but

local control

remained imited.This

point

is

important

not so much in explaining the relative weakness of subnationalgov-

ernments in

postauthoritarian

Chile,

but for

the

implications

of this

weakness as

it

affected he

functioning

of Chile's

hybrid

decentralization

arrangements

nder

democracy.8

The

visible

intervention

of

President

Ricardo

Lagos

(2000-2006)

in

health

and

education

policy

before the October

2000

municipal

elec-

tions

(the

resultsof

which would be

interpreted

s

a

referendum n

the

administration's

erformance)

highlights

he

political

ncentives or

cen-

tral

officials

o intervene

n

supposedly

decentralized

ervices.

In March

2000,the UnitedNationsreleasedthe resultsof a 1999survey revealing

that

almost

70

percent

of

Chileans

were dissatisfied

with the

country's

situation.

Respondents

anked

educationand

health care

as the

top

two

areas

where

changes

were

needed

(Santiago

Times

2000a).

Soon

after-

ward,

President

Lagos pledged

to

end

waiting

lines in all

of

the

coun-

try's

municipally

administered ealth

clinics

within

three

months

(San-

tiago

Times

2000c).

This

included

a

much-publicized

but less-than-

successful

attempt

by

the

Health

Ministry

o draw more

physicians

nto

municipal

clinics.

In

education,

the

president

promised

to double

the

per-studentsubsidy, reduce dropout rates, and improvethe perform-

ance of

disadvantaged

students

(Santiago

Times

2000b).

The central

government

responded

to

public

opinion

(not

organized popular

demand),

but not

by

increasing

ocal control

over clinics

and

schools;

just

the

opposite.

While the

desire

to

improve

the

quality

and

equity

of

public

serv-

ices

was

certainly

a factor n

these

decisions,

political

calculations-the

inclination of

central

politicians

to take credit

for

improvements

in

locally

administered

ervices-also

probably

played

a

part.

This

trend

correspondswith the earlierobservation hatcentralofficials nterested

in

credit

claiming

have incentives

to

hold

subnational

officialsaccount-

able for

effective service administration. Instead of

holding municipal

governments

accountable for

improved

services, however,

in Chile the

central

government

has

acted for

them,

partly

to

help

the electoral

chances of

the

governing

coalition's candidates

for

municipal

office.



16/32

KUBAL:


119

Thus,

in

the context

of the

administrative ecentralization

f

important

services,

municipal

elections

became

a

mechanism

or

local

communi-

ties

(albeit

it somewhat

indirectly)

to hold

the

central

government

accountable for service

quality

when their own local

governments

lacked the

autonomy

and

resources

o act.

A

government

headed

by

the

right,

while

likely

to

respond

with different

policies,

would have

the

same

incentives

during

the

local election season.9

Newly

elected

municipal

officials

entered

their

first

term in

1992

at

a

disadvantage

elative

o

central

politicians

and administrators.

ecause

mayors

were

appointed

during

he

two decades of

military

ule

(and

the

firsttwo

years

afterthe

transition),

he

prestige

of

the

office was some-

whattainted.10 ome of the reforms hat ncreasedcentral nfluenceover

health

and education

administration

ere

passed

before

the

municipal-

ities

gained

political

autonomy.

Control

over

fiscal

resources,moreover,

did not

accompany

(and

thus

constrained)

the renewal

of

municipal

political

autonomy

(IDB

1994, 209;

Yafhez

and

Letelier

1995,

138).

Somewhat

paradoxically,

t

may

be

that the

very

weakness

of Chile's

municipalities

orced

municipal

officials

o

become

more effective

advo-

cates for

the

local

consumers

of decentralized

ervices,

introducing

an

element of

vertical

accountability,

which

certainly

did

not

exist

under

military ule.

Municipal

officials

and

their

nonpartisan

lobbying group,

the

Chilean

Municipal

Association

Asociaci6n

Chilena

de

Municipalidades,

AChM),

ormed

in

1993,

had

some

success in

changing

the transfer

mechanismsand

increasing

he

funding

or

the decentralized

linics

and

schools.

They

framed

this

issue

in terms

of

accountability.

One AChM

official

observed

that from

the

municipal

standpoint,

it s

irresponsible

on our

part

to

maintaina

system

where we cannot

guarantee

he

pop-

ulation a

situation

of

quality

in

terms

of the services

we are

offering

(Luna1997). This sentimentwas echoed by the association'ssecond

president

in

his

inaugural

peech:

Wedo

not

want

to continue

lying

and

sacrificing

our

neighbors.

They

have

the

right

to

count on

good

education

and health

care.

. .

This

is

why

we are

demanding

resources

[from

the

central

government].

It is because

we

feel an

obligation

towardthe

people

whom

we swore

to serve

El

Mercurio

1997a).

Because the

original decentralizing

legislation

obligated

central

authorities o

fund the

operating

budgets

of health

and

educationestab-

lishments,

municipal

efforts

to

secure

this

funding

represent

an

attempt

to hold the nationalexecutive accountable.Becausethey did not have

legal

authority

o

sanction

central

ministry

officials,moreover,

his was

accomplished mainly by

using

the

media to

get

municipal

issues

onto

the

public

agenda

(Belmar 2003).



17/32

120

LATIN

AMERICAN OLITICSAND SOCIETY

48:

4

Education

Reform

During

the

1990s

and

2000s,

central

education

reform

focused

on

improving

the

quality

and

equity

of

municipalized

education

through

expanded

ministry support,

both financial and technical.

Between

1990

and

1993,

spending

on

decentralized educational establishments

increased

by

nearly

25

percent.

Under

the

Aylwin

administration,

sev-

eral

support programs

were

implemented,

including

the

program

for the

Improvement

of

Education in Poor

Zones

(P-900),

initially

funded

partly

by

the

Swedish and

Danish

governments,

and

the

Program

to

Improve

Educational

Quality

and

Equity

(MECE).

The

MECE

program

received

a

$170

million

loan

from the World Bank and

$73

million

in

matching

funds

from

the Chilean

government

(Allard

1994,

37).

During

the

second half of

the

1990s,

the

government

of Eduardo

Frei

1994-2000)

dedicatedeven more

resources o

education

under the

rubric

of its

comprehensive

Educational

Reform

nitiative

La

Reforma

Educativa).

The

MECE nd

P-900

programs

were

expanded,

along

with

other

programs

aimed

at

pedagogical

improvement

at the school

level,

initiatives

to

improve

teacher

training

and

motivation,

and

a

gradual

transition o

a

full

schoolday

(as

opposed

to

dual

morning

and after-

noon shifts).11The Lagosadministration ommitted tself to continuing

the

reforms,

particularly

xpanding

the

P-900

program,

which

targets

underprivileged

hildren;

completing

the transition

o the full

school-

day;

and

increasingmandatory

ducation from 8 to

12

years (Santiago

Times

2001a,

2003,

2004).

The

administrative

tructure

of

the

ministryprograms

conveys

the

tensions

between

centraland

local bureaucrats.

The

implementation

f

initiatives

under the MECE

and the

P-900

programs

did not involve

municipal

education

administrators;

he

relationship

was between

the

municipalized chools and the centralministry through ts provincial

departments).

One Education

Ministry

fficial

remarked

hat

legally,

the

ministry's

responsibility

was to

support

the

educational

establish-

ments-it

was not

obliged

to

go through

the

municipalities,

although

there was

movement

in

this direction

(Herrera

1997).

In

reality,

the

arrangements

f

municipalization

fficially

eft all

technical-pedagogi-

cal decisions

to the

ministry.

Nevertheless,

many (particularly

arger,

urban)

municipalities

moved to create

their

own

technical

eams,

which

worked

alongside

the

provincial

ministry

upervisors.

Whenmunicipaleducationdepartmentswere involvedin technical

and

pedagogical

matters,

heir

decisions often were

subordinated

o cen-

tral

planning priorities.

For

example,

the

centrally

mandated

annual

municipal

education

plan

(PADEM)

was executed

by

the

municipal

edu-

cation

departments

at

the

direction of

the

ministry

and had to be

adapted

to the

technical-pedagogical

norms,

policies,

and

programs

of



18/32

KUBAL:


121

the

Education

Ministry

Ministerio

de

Educaci6n

nd,

13).

A

researcher

who worked on an

Interior

Ministry

valuation

of

the

PADEM

bserved

that tensions between

ministry upervisors

and

municipal

officials

were

particularly

isible in

municipalities

where

mayors

or

municipal

educa-

tion

departments

ook a

strong

nterest

n

technical

ssues

(Zambra

997).

At

the school

level,

significant

progress

was made

toward

increas-

ing

the

autonomy

and

participation

f administrators

nd

staff,

which,

along

with

resources

accompanying

central

initiatives,

contributed

o

increasing

he

quality

of

education

n

targeted

chools. Some

central

ni-

tiatives,

such as the

educational

improvement

projects

(PME)

unded

through

the MECE

rogram,

gave

a

great

deal

of discretion

to

school

officials.12 he PMErepresented he firststep in what has been termed

pedagogical

decentralization

y

creating

a

space

for teachers

collec-

tively

to

evaluate their

schools'

needs

and to

design

projects

to

meet

those needs.

Examples

of

projects mplemented

n

the schools

include

folklore

workshops,

innovative

programs

o

improve

math

skills,

and

facilities or

art nstruction.

The teachers

received

technical

support

rom

the

ministry's

provincial

departments

n

formulating

heir

proposals,

which were then

submitted

for

the

ministry's

onsideration

n

annual

competitions.

Althoughthe PME mprovedteachers'participationn the schools

and contributed

much-needed materials

and

inancial

support,

there is

little

empirical

evidence to

support

the Education

Ministry's

laim

that

the

projects

have

significantly

ltered he

schools'

relationship

with the

larger

community

Courard

1998;

Kubal

2001;

Ministerio

de

Educaci6n

1996,

57).

The

PADEM

lso

succeeded

in

increasing

eacher

nvolvement

in

school

management

but

generally

failed

to include the

larger

com-

munity

in

meaningful

decisionmaking,

as

originally

intended

(Kubal

2001;

Ramirez

nd

Zufiiga

1997).

Recognizingthe frustrations f municipaleducation officials and

hoping

to

spur

local

innovation,

the

Frei administration

moved to

increasethe

municipal

role

in

education

policy

decisions;

for

example,

by giving

municipal

education

departments

he

option

to

modify

the

curriculum

under

the

supervision

of

provincial

education

administra-

tors).

This increased ocal

autonomy,

however,

increased

choices

only

in

those

jurisdictions

with

the resources

to

innovate.

The one

case of

large-scale

nnovation in

municipal

education

administration

n

Chile

illustrates his

point.

Under the administration

f

Mayor

Joaquin

Lavin

(1993-99), control over public schools in Chile'swealthiestmunicipal-

ity,

Las

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