Abstract
Governments decentralized for various political and economic reasons. It can be a means to move decision making closer to people, to enhance the efficiency and responsiveness of service delivery, and to make tax systems more productive. In some countries, it may also promote national cohesion (e.g., Indonesia). Done well, decentralization can lead to all of the benefits promised by a multi-tiered intergovernmental system: better public services, enhanced local accountability, and a potential tool for poverty alleviation. But if decentralization is done badly, it can lead to macroeconomic instability, deterioration in service delivery, corruption and collapse of the safety net.
Lead Public Sector Specialist, the World Bank, dweist@worldbank.org. This paper reflects the views of the author and not the World Bank.
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Weist, D. (2007). Intergovernmental Loans: Their Fit into a Transfer System. In: Martinez-Vazquez, J., Searle, B. (eds) Fiscal Equalization. Springer, Boston, MA. https://doi.org/10.1007/978-0-387-48988-9_17
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DOI: https://doi.org/10.1007/978-0-387-48988-9_17
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