Impacts and Consequences of the New Regime of Autonomies in Bolivia: Elements for a Discussion

43 Pages Posted: 21 Jul 2011

See all articles by Jean-Paul Faguet

Jean-Paul Faguet

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP)

Date Written: July 1, 2011

Abstract

Bolivia’s 1994 Popular Participation reforms devolved political powers and resources to hundreds of municipal governments throughout the land. The country is currently implementing a further round of reforms that would grant a degree of autonomy to departmental, regional, municipal, and indigenous and rural governments. What effects might this have on public investment patterns, government responsiveness, government fiscal relations, the sustainability of public finances, and political accountability? Acknowledging from the outset that it is too soon to analyze the effects of this reform, I instead examine its main provisions in light of the insights provided by the international fiscal federalism literature, and extensive evidence on the effects of Bolivia’s 1994 reforms. By submitting the law to the dual rigors of theory and evidence, we can try to arrive at contingent predictions of its likely effects which, if not precise, are at least reasonable baselines. These in turn allow us to make recommendations for amendments and adjustments, not so much to the legal text as to the more complicated question of the implementation of reform. The deeper aim of this paper is to enrich the current debate on how decentralization can be implemented in ways that strengthen democracy and give voice to the poor.

Keywords: decentralisation, autonomy, fiscal federalism, public investment, local government, Bolivia

JEL Classification: H41, H75, H77

Suggested Citation

Faguet, Jean-Paul, Impacts and Consequences of the New Regime of Autonomies in Bolivia: Elements for a Discussion (July 1, 2011). Available at SSRN: https://ssrn.com/abstract=1892011 or http://dx.doi.org/10.2139/ssrn.1892011

Jean-Paul Faguet (Contact Author)

London School of Economics & Political Science (LSE) - Centre for Economic Performance (CEP) ( email )

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