Political and Fiscal Devolution
Devolution of powers and resources to local governments has been a foundation
for promoting sustainable decentralization in developing countries. Advocates
argue that local governments with decisionmaking power, authority, and
resources can play a more catalytic role in economic and social development.
Citizens are more likely to participate actively in local political processes where
local governments are perceived to have the capacity to make political and
financial decisions affecting their economic and social welfare.
In chapter 4 Merilee Grindle analyzes the findings of her recent study of
thirty randomly selected, medium-sized municipalities in Mexico to understand
how local governments are coping with new responsibilities and resources and
how they differ on indexes of government performance. She examines the
impacts of four factors—political competition, the capacity of political leaders
to mobilize resources for change, the introduction of new methods and skills for
public administration, and the demands and participation of civil society—on
the capacity of local governments to carry out their responsibilities efficiently,
effectively, and responsively. She then analyzes their correlation with improved
government performance.
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