Governance from Below: A Theory of Local Government with Two Empirical Tests

LSE-STICERD Political Economy and Public Policy Working Paper No. 12

48 Pages Posted: 8 Nov 2005

See all articles by Jean-Paul Faguet

Jean-Paul Faguet

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

Multiple version iconThere are 2 versions of this paper

Date Written: September 2005

Abstract

I examine decentralization through the lens of the local dynamics that it unleashes. The national effects of decentralization are simply the sum of its local-level effects. Hence to understand decentralization we must first understand how local government works. This paper proposes a theory of local government as the confluence of two quasi-markets and one organizational dynamic. Good government results when these three elements - political, economic and civil - are in rough balance, and actors in one cannot distort the others. Specific types of imbalance map into specific forms of government failure. I use comparative analysis to test the theory's predictions with qualitative and quantitative evidence from Bolivia. The combined methodology provides a higher-order empirical rigor than either approach can alone. The theory proves robust.

Keywords: local government, civil society, democratic theory, good governance, decentralization, Q2 (Q-squared), Bolivia

JEL Classification: D71, H41, H42, H72, O18

Suggested Citation

Faguet, Jean-Paul, Governance from Below: A Theory of Local Government with Two Empirical Tests (September 2005). LSE-STICERD Political Economy and Public Policy Working Paper No. 12, Available at SSRN: https://ssrn.com/abstract=842884 or http://dx.doi.org/10.2139/ssrn.842884

Jean-Paul Faguet (Contact Author)

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

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