Concepts of decentralization have changed rapidly over the past quarter of
a century in tandem with the evolution in thinking about governance.
Until the early 1980s government and the state were generally perceived of
interchangeably. Government was seen as the institutional embodiment of state
sovereignty and as the dominant source of political and legal decisionmaking. In
developing countries, debates over the structure, roles, and functions of government
focused on the effectiveness of central power and authority in promoting
economic and social progress and on the potential advantages and disadvantages
of decentralizing authority to subnational units of administration, local governments,
or other agents of the state. Decentralization was defined as the transfer of
authority, responsibility, and resources—through deconcentration, delegation, or
devolution—from the center to lower levels of administration.1
By the early 1980s increasing international trade and investment; growing
economic, social, and political interaction across national borders; and rapidly
emerging technological innovations that increased the scope and reduced the
costs of communications and transportation and helped spread knowledge and
information worldwide, changed perceptions of governance and of the appropriate
functions of the state. The concept of governance expanded to include not
only government but also other societal institutions, including the private sector
and civil associations. Debates shifted from the proper allocation of responsibilities
within government to how strongly the state should intervene in economic
From Government Decentralization
to Decentralized Governance
g. shabbir cheema and dennis a. rondinelli
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activities, whether central governments inhibited or promoted economic growth
and social development, and the appropriate roles of government, the private
sector, and civil society.2
As international economic interaction grew and as societies became more
complex and interconnected, government came to be seen as only one, albeit a
critically important, governance institution. The fact that people’s lives were
also shaped by decisions made by individual entrepreneurs, family enterprises,
and private firms; by multinational corporations and international financial
institutions; and by a variety of civil society organizations operating both within
and outside of national territories, became more apparent.3 As globalization
pushed more countries to adopt market or quasi-market economies, and as
technology drove the growth and integration of worldwide communication and
transportation networks, demands for political and economic participation grew
even in countries that had totalitarian, authoritarian, or dictatorial governments
and in which the state traditionally played the dominant or controlling role in
managing national affairs. Good governance came to be seen as transparent,
representative, accountable, and participatory systems of institutions and procedures
for public decisionmaking.4
From this broader perspective on governance new concepts of decentralization
emerged as well. As the concept of governance became more inclusive,
decentralization took on new meanings and new forms. In this book, we trace
the transformation and evolution of concepts and practices of decentralization
from the transfer of authority within government to the sharing of power,
authority, and responsibilities among broader governance institutions. The contributors
to this volume assess the emerging concepts of decentralization; the
political, economic, social, and technological forces driving them; and new
approaches to decentralizing both government and governance. The authors of
each chapter explore the objectives of decentralization within this changing
paradigm and the potential benefits of and difficulties in achieving them. Each
of the chapters offers lessons of experience from countries around the world
where attempts have been made to decentralize government or governance and
the implications for public policy in the future.