A sequential Theory of Decentralization: Latin American Cases in Comparative Perspective

This article was published in the American Political Science Review Vol. 99, No. 3, in August 2005.

Author: Tulia Falleti, Associate Professor at the University of Pennsylvania

Abstract:

"Both advocates and critics of decentralization assume that decentralization invariably increases

the power of subnational governments. However, a closer examination of the consequences of

decentralization across countries reveals that the magnitude of such change can range from

substantial to insignificant. In this article, I propose a sequential theory of decentralization that has three

main characteristics: (1) it defines decentralization as a process, (2) it takes into account the territorial

interests of bargaining actors, and (3) it incorporates policy feedback effects. I argue that the sequencing

of different types of decentralization (fiscal, administrative, and political) is a key determinant of the

evolution of intergovernmental balance of power. I measure this evolution in the four largest Latin

American countries and apply the theory to the two extreme cases (Colombia and Argentina). I show

that, contrary to commonly held opinion, decentralization does not necessarily increase the power of

governors and mayors."