London Connection Q&A: Professor Jean-Paul Faguet

LSE Professor Jean-Paul Faguet talks to Keith McDonald about his new project on decentralization and the value of a degree in international development
Professor Jean-Paul Faguet, London School of Economics and Political Science
Is decentralization good for development? In short, yes! - Professor Jean-Paul Faguet
Increasing complexity in government can lead to some greater cost. But the upsides are potentially far more important

You have recently co-edited a book on 'decentralization' – a subject you've worked on for 20 years. Can you tell us more about what this term means and why it's important?

Once we define 'development' as increasing human well-being and freedom, you might think that what 'decentralization' means is the easier question. Weirdly, it isn't. There's far less agreement about exactly what it means. As a result, people are tempted to twist it into different contexts.

What decentralization does is to empower (or create) subnational governments by delegating significant resources and authority downwards. A relatively simple system of bureaucracy that is run from the capital gets transformed into a more complex system of coordination, cost sharing, and overlapping responsibilities amongst multiple tiers of autonomous government with independent mandates.

As a result, the provision of public services, from local level to national level, becomes the joint-responsibility of two or more levels of government.

Despite what some may say, decentralization is not about the abolition or elimination of the important role of central government in providing public services. Nor does it mean the transfer of all functions to regional or local governments. For the most part, it does not even mean the complete transfer of any service to subnational governments.

With the exception of some very local services with few economies of scale – like trash collection – the centre will continue to be involved in local service provision, even after radical decentralization, in important ways.

So, is decentralization good for development?Decentralization cover

In short – yes! Increasing complexity in government can lead to some greater cost. But the upsides are potentially far more important.

One advantage of a multi-tiered system is its ability to compensate when any one part fails. Imagine you live in a centralized country: a hurricane is coming, and the government is inept. Where can you turn? Nowhere – you’re sunk!

In a decentralized country, ineptitude in regional government can be offset by a competent local government, for example. And even where both fail, central government is independently constituted and may be able to help.

Furthermore, multiple government levels help to generate a competitive arena in which candidates and parties can use local platforms to demonstrate their competence and work themselves up the chain of hierarchy. In a centralized system, by contrast, there is one – very big – prize, and not much of a training ground on which to prepare.

You either believe in democracy or you don't. If you really do, and if locally-specific services exist, then you must believe in local democracy too

Another key advantage is the level of information that a decentralized government can bring to any public problem.

Consider the technical expertise required to plan a vaccination campaign or build a water treatment plant, for example. These tasks require specialists that tend to cluster in cities and work for central government, where the pay is better and the challenges more interesting. Accordingly, central government has an important advantage in the different sorts of technical expertise required.

But location-specific data is also important to deliver efficient and effective services. When and where can the targets of a vaccination drive best be reached? How are local sewerage needs likely to grow and change in the future?

Information of this sort is crucial to the success of a public project. But it does not reside with central government, which has weak incentives to acquire it. It resides naturally with local government, which has much stronger incentives to find it out and act on it.

The genius of a properly designed decentralization system is that it combines technical expertise from above with local time-and-place information from below in a way that is superior to what either level of government could achieve on its own. The result is greater public-sector efficiency, effectiveness, and faster development.

How does decentralization relate to democracy?

Deeply. The two are in my view integral to one another. Consider for a moment: who is it that should be deciding on local services that mainly affect the residents of a particular region – the officials in that place, elected by the affected residents, or the officials in the capital, elected by the entire nation?

I have heard colleagues declare their allegiance to both democracy and the centralized state, and I just don’t get it. Citizens must be allowed to vote… but only for national government? Should they not be allowed local governments too? Why must local services with few externalities, like local policing or primary education, be provided by a distant central government?

After 20 years of thinking about this, it seems arbitrary, incoherent, and wrong. You either believe in democracy or you don't. If you really do, and if locally-specific services exist, then you must believe in local democracy too.

As the author of the study materials for the Development Management module (DV3165), could you explain a bit more about the subject?

The discipline of development management views the comparative statics and comparative dynamics of development through the lens of institutions and organisations.

What do we mean by that?

The comparative statics of development are: why are some countries rich and some countries poor at any given moment in time? Comparative dynamics are the process of getting richer and freer and more developed and more sophisticated and more productive, but also the processes of decay (or 'de-development') in other cases.

In development management, we seek to explain these process of development and also, at any given moment in time, to understand the distribution of countries and societies and regions across the world in terms of development through the lens of institutions and organisations.

Anyone seeking employment that deals with the developing world, even if it’s not doing development in itself, can benefit from doing an international development degree

The University of London module in Development Management (DV3165) uses an institutional approach to examine the development process and to analyse the root of developmental and anti-developmental experiences in countries, regions and organisations. The approach draws on institutional theories from political science, sociology and the new institutional economics.

Finally, for anybody who might be interested in studying an international development degree or taking individual modules to supplement their other programmes: what is the value of a degree in this field? Where can it lead, career-wise?

The subject matter naturally appeals to the social sciences, but it will also benefit those with interests or specialisms in mathematics, literature, history, economics, and the core sciences.

Graduates with development management experience – particularly those with postgraduate qualifications – can end up working in governments in developing countries, as well as big and small NGOs and the big multilateral institutions.

Some with experience in IT and project management go on to found electronic banking companies or social enterprises.

Anyone seeking employment that deals with the developing world, even if it's not doing development in itself, can benefit from doing an international development degree, and these industries can certainly benefit from hiring graduates of these programmes.

Jean-Paul Faguet

Jean-Paul Faguet (@jpfaguet) is Professor of the Political Economy of Development in the Department of International Development at the London School of Economics and Political Science. He is the author of the subject guide and resource pack for the 'Development Management' module (DV3165), which is available through the Economics, Management, Finance and the Social Sciences programmes. The new collection of essays on decentralization co-edited by Jean-Paul is now available from Oxford University Press.