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Political capture of decentralization : vote-buying through grants-financed local jurisdictions, Volume 1
Author:Khemani, Stuti; Country:World;
Date Stored:2010/06/24Document Date:2010/06/01
Document Type:Policy Research Working PaperSubTopics:Subnational Economic Development; Public Sector Economics; National Governance; Parliamentary Government; Banks & Banking Reform
Language:EnglishMajor Sector:Education; Public Administration; (Historic)Health and other social services
Rel. Proj ID:1W-Public Services Team-688125 -- -- P086338;Region:The World Region
Report Number:WPS5350Sub Sectors:Other Education; Other Public Administration; Other social services
Collection Title:Policy Research working paper ; no. WPS 5350Volume No:1

Summary: A recent trend in decentralization in several large and diverse countries is the creation of local jurisdictions below the regional level -- municipalities, towns, and villages -- whose spending is almost exclusively financed by grants from both regional and national governments. This paper argues that such grants-financed decentralization enables politicians to target benefits to pivotal voters and organized interest groups in exchange for political support. Decentralization, in this model, is subject to political capture, facilitating vote-buying, patronage, or pork-barrel projects, at the expense of effective provision of broad public goods. There is anecdotal evidence on local politics in several large countries that is consistent with this theory. The paper explores its implications for international development programs in support of decentralization.

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