The Independent Evaluation Group (IEG) assessed the effectiveness of Bank support for decentralization between fiscal 1990 and 2007 in 20 countries, seeking to inform the design and implementation of future support. Given the difficulties of measuring the results of decentralization, the evaluation used intermediate outcome indicators such as strengthened legal and regulatory frameworks for intergovernmental relations, improved administrative capacity, and increased accountability of subnational governments and functionaries to higher levels of government and to citizens to assess the results of Bank support in these 20 countries. To examine potential lessons at a sectoral level, the evaluation also assessed whether Bank support for decentralization improved intermediate outcomes for service delivery in the education sector in 6 of the 20 countries. Bank support contributed to more effective decentralization substantially in more than one-third of the 20 cases and modestly in the others. The most successful aspects of Bank support pertained to the legal frameworks for intergovernmental relations...

This study considers key aspects of administrative performance in three areas related to policy, people, and systems. First, in the field of policy, the study addresses issues of performance management, strategic planning and policy coordination and formulation. Second, as regards people, the study reviews human resource management practices such as recruitment and career management, incentive systems and politico-administrative relations with the aim of assessing the extent to which public administrations in the EU8 can attract and retain high quality staff in the context of rapidly changing labor markets. Finally, in relation to systems, the study looks into one specific aspect of public service delivery, namely the extent to which states have introduced e-Governance systems and used these effectively to enhance the business environment. A benchmarking exercise was conducted in each of the key aspects studied. A specific aim of the study was to identify examples of good practice within the region which might be replicable in other EU8 countries. This study reviews the direction of administrative development in the first two years of EU membership in the EU8 and includes a review of general trends in administrative development as well as a benchmarking exercise for a sample of states on selected criteria that illustrate capacity for public management innovations. The study will draw conclusions on ways to address the identified issues and problems in the development of the public management systems of the EU8...

This paper investigates how reductions of barriers to migration affect the decision of middle school graduates to attend high school in rural China. Change in the cost of migration is identified using exogenous variation across counties in the timing of national identity card distribution, which made it easier for rural migrants to register as temporary residents in urban destinations. The analysis first shows that timing of identification card distribution is unrelated to local rainfall shocks affecting migration decisions, and that timing is not related to proxies reflecting time-varying changes in village policy or administrative capacity. The findings show a robust negative relationship between migrant opportunity and high school enrollment. The mechanisms behind the negative relationship are suggested by observed increases in subsequent local and migrant non-agricultural employment of high school age young adults as the size of the current village migrant network increases.

This paper discusses decentralization (administrative, fiscal and political) of government in public service provision. It aims to facilitate understanding among practitioners, policy makers, and scholars about what decentralization entails in practice compared to theory. A review of the empirical literature and experience of decentralization is presented. The paper highlights issues that policy makers in developing and transitional countries should be aware of when reforming government, considering their unique political and economic environment. The author argues that decentralization produces efficiency gains stemming from inter-jurisdictional competition, enhanced checks and balances over the government through voting at the subnational level, and informational advantages due to proximity to citizens. By contrast, arguments against decentralization include the risk of an increased level of corruption, coordination problems stemming from multiple layers of government, low capacity of subnational government...

The Municipal Development Program (MDP) ws launched in 1991 with the World Bank as the executing agency and with the support of several donors to assist the governments in building local government capacity. The Program reflects the belief that since locally-elected officials are usually more in touch with the public than their central government counterparts, there is greater likelihood that the policies chosen will reflect the concerns of the committees and also be more accountable to them. The MDP is a facility that provides quick-disbursing grants to local executing authorities for policy development and capacity building. Support is made in the form of small grants and consultants, using action planning workshops and asissting in strategic planning aimed at providing management tools and adding key skills to selected staff. The MDP has been able to do this because of its design which allows for flexibility and easy access to funds, and its focus--local municipalities.

Developing countries have decentralized functions and responsibilities for service delivery to lower levels of government at an increasing pace in recent years. The main reasons for such reforms are often political, but governments adopt them also as a way to improve service delivery and local governance. Typically, after the political decision is made, a country will turn to its development partners including the World Bank for support in implementing the new policies and achieving their development objectives. Independent Evaluation Group (IEG) assessed the effectiveness of Bank support for decentralization between FY90 and FY07 in 20 countries, seeking to inform the design and implementation of future support. Given the difficulties of measuring the results of decentralization, the evaluation used intermediate outcome indicators such as strengthened legal and regulatory frameworks for intergovernmental relations, improved administrative capacity, and increased accountability of sub-national governments and functionaries to higher levels of government and to local citizens to assess the results of Bank support in these 20 cases. To examine potential lessons at a sectoral level...

This study evaluates the connections between community-driven development (CDD) and decentralized local governance, and the need to identify strategies for operational integration. It aims to deepen the understanding of how the institutional environment for local governance interacts with CDD project operations. It gives special emphasis on the issue of accountability, analyzing how CDD operations perform in terms of strengthening the capacity of citizens and civil society to hold local authorities and public service providers accountable, and the capacity of the local government to be held accountable. The study utilizes a two-pronged approach. First, it assesses the institutional environment for accountability in local governance. Second, it examines the operations of two major World Bank-assisted CDD projects in two municipal case study sites. Given that CDD projects both shape and are shaped by local governance contexts in which they are embedded, the study investigates how CDD operations in the Philippines are affected by and are helping reform local governance conditions. It is from the analysis of this interface between CDD operations and local governance conditions that the study aims to generate policy and operational recommendations to enhance integration between CDD and local governance approaches. The analysis of the institutional environment for accountability in local governance often found an enabling policy and legal framework in principle...

Demand for social protection is growing in low income countries and fragile situations. In recent years, the success of social protection (SP) interventions in middle income countries (MICs) like Brazil and Mexico, along with the series of food, fuel, and financial crises, has prompted policymakers in low income countries (LICs) and fragile situations (FSs) to examine the possibility of introducing such programs in their own countries. Flagship programs in countries as diverse as Ethiopia, India, Pakistan, and Rwanda have shown the adaptability of social protection interventions to the LIC context. Yet, despite growing levels of support for these initiatives, many challenges remain. In LICs and FSs, governments are confronted with a nexus of mutually reinforcing deficits that increase the need for SP programs and simultaneously reduce their ability to successfully respond. Governments face hard choices about the type, affordability, and sustainability of SP interventions. The paper reviews how these factors affect SP programs in these countries and identifies ways to address the deficits. It supports the establishment of resilient SP systems to address specific needs and vulnerabilities and to respond flexibly to both slow and sudden onset crises. To achieve this...

Several Association of Southeast Asian Nation (ASEAN) member states, in the aftermath of the global financial crisis, are expanding their social safety net programs. In many cases, existing delivery mechanisms for social assistance in the region tend to be basic, in line with the small size of programs. This paper is an analytical framework to systematically consider and include governance aspects in the design and analysis of modern social assistance programs. The underlying conceptual model is simple. Programs face a set of supply-side challenges that have to do with their institutional structure and the ways in which accountability and incentive relationships are shaped. However, both in the region and elsewhere in the world there are a number of experiences with diverse governance tools that countries can draw upon as they think how best to design and implement more sophisticated and comprehensive social safety net programs. Finally, administrative capacity is likely to represent a constraint as governments seek to deliver increasingly complex programs to a growing number of beneficiaries over a wide geographically dispersed area. While large investments in administrative capacity are unlikely...

Improving governance is a major development challenge for Cameroon and for many other developing countries, and making public financial management more transparent is a central part of it. While budgets are public documents, accessible to citizens in principle, in practice, budget information is difficult to come by as a result of political, administrative, capacity, and logistical constraints as well as cost barriers at all tiers of government, including the national, regional, and municipal level and at service-delivery points like schools and health centers. In two of Cameroon s 10 regions, a World Bank-supported initiative has piloted a citizen-centered approach for disseminating simplified budget information of 151 schools, 58 health centers, and 28 municipalities and the two regional administrations. Budgets were made public and awareness was raised through various activities, including public community meetings at which the budgets of institutions were read aloud, poster campaigns, art competitions...

The Chinese economy has experienced an unprecedented 30-year period of economic growth and development that has delivered enormous social and economic benefits to the people but has had seriously adverse and continuing effects on the state of the environment. The government is well aware of the problem. Over the last five to ten years, environmental objectives have become increasingly important in priorities set under successive national five-year plans. To address these problems, the government has provided increasingly large infusions of capital and implemented a series of administrative reforms. Notwithstanding all these actions, the state of the national environment continues to deteriorate, and further action is clearly needed. This policy note focuses particularly on continuing issues related to the operations of the Ministry for Environmental Protection (MEP), including the legal framework under which it operates and its operational relationships with other agencies at the national level and with its counterparts at lower levels of government. This focus is justified given that MEP's effectiveness is critical to the effectiveness of the government's overall environmental objectives. Without an effective MEP...

To achieve higher growth and reduce poverty and inequality, Mexico needs to improve public service delivery. Mexico is a middle-income country with continuing high levels of poverty (46.2 percent of the population). To improve public sector service delivery, Mexico needs to ensure sufficient financial and human resources relative to the needs of the population, and effective and efficient public management of spending programs to address those needs-two basic prerequisites for an effective public sector. Mexico's public service delivery is hindered by low tax collection and expenditure inefficiencies at all three levels of government: federal, state, and municipal. Mexico's tax collection is also low by Latin American standards. The problem of low tax collection is particularly acute at the local level, as many subnational governments lack incentives and administrative capacity. At the local level, improving tax collection faces additional challenges. Low subnational tax collection increases the volatility of subnational finances within Mexico's fiscal federalism framework. Subnational governments need incentives and assistance to improve their tax administration to increase own revenues. As part of an ambitious strategy to modernize public sector financial management...

Recent international experience has shown that excessively complex administrative procedures, required to establish, and operate a business, discourage inflows of foreign direct investment. The authors present a new database on the administrative costs faced by private investors in 32 developing countries. The database is much more comprehensive than the existing sources, as it contains not only information on general entry procedures, such as business and tax registration, but also captures regulation on land access, site development, import procedures, and inspections, The data include measures on the number of procedures, direct monetary costs, and time. The cost of administrative procedures vary significantly across countries. The most important barriers appear to be the delays associated with securing land access, and obtaining building permits, which in several countries, take more than two years. Countries that impose excessive administrative costs on entry, tend to be equally intrusive in firm operations...

The objective of this report is to review and recommend improvements to Ethiopia's approach to public sector reform in order to advise the Government and executive institutions on the future of its public sector reform. The report also serves as a think piece for the World Bank, other partners, and policy makers. The report provides important basic information about the features of Ethiopia's public sector reform approach and reviews what worked well and what did not. It draws lessons from other countries' experience to help develop ideas and instruments of future public sector reforms in Ethiopia. Ethiopia's system of decentralization process has been credible in devolving power, improving governance and service delivery well as narrowing the per capital differences among Regional Governments and districts. The second phase of decentralization was 'big bang' and brought some gaps on addressing administrative and fiscal decentralization issues associated with: a) detailed clarity of expenditure and revenue assignments...

This Country Economic Memorandum is the first economic report in a decade. It gives priority to updating knowledge about the evolution of social and economic developments during the 1990s. It reviewareas of progress in macroeconomic reforms and the lack of success in governance and institutional reforms. Substantial reforms were undertaken in this period , but the civil war continued to have a serious negative impact on Sudan's people and its economic prospects. While the results of the reforms have been promising, particularly in the area of macroeconomic stabilization and liberalization, the distribution of economic wealth needs to improve. Although there has not been any national household survey since 1978, social indicators point to low levels of welfare throughout Sudan, with some indicators well below those in Sub-Saharan Africa. among the many issues facing the Sudanese economy are these: There has been high growth but skewed distribution. Stabilization has been costly in social terms: expenditures were cut by more than 50 percent relative to gross domestic product (GDP)...

This report reviews intergovernmental fiscal relations in Moldova and recommends ways to improve the efficiency and equity of local public finance, while maintaining fiscal sustainability. Local public authorities are responsible for meeting key public service delivery needs. They play a major role in education and bear primary responsibility for urban and rural functions such as water supply and local road construction and maintenance. But local authorities are unable to fulfill this role due to sub-optimal size, inadequate financial capacity, and low administrative capacity. The Government of Moldova is reforming intergovernmental fiscal relations, as part of broader commitments under the national decentralization strategy (2012). They set new rates for sharing national taxes with the two tiers of local government, introduce formulas for transfers to local governments, and remove subordination in financial relations between top and bottom tiers of local government. This report reviews recent reforms in local public finance and makes suggestions to further improve subnational expenditures...

This paper examines historically the World Bank's twin features: lending to developing economies to achieve tangible results and advocating specific development policies. Section 1 provides some conceptual underpinnings for the view that an effective state is essential for development. It asks whether development can be engineered, and state capacity increased, with large aid flows. Section 2 sketches the historical evolution of what characterizes the World Bank: lending to developing economies and advocacy of development policy. It concludes that, while the Bank discourse explicitly recognizes that developing countries need to improve their governance and build the capacity of the public sector to improve living standards, the Bank's performance in assisting governments in building state capacity and achieving better governance outcomes has been disappointing. Section 3 proposes an interpretation of why this has been the case. The interpretation is structural, and related to the way the Bank is organized. This concerns in particular (1) how its research is prioritized and used for decision-making...

Both consumers and the government benefited from reform of the water system in Conakry, Guinea, whose deterioration since independence had become critical by the mid-1980s. Less than 40 percent of Conakry's population had access to piped water - low even by regional standards - and service was intermittent, at best, for the few who had connections. The public agency in charge of the sector was inefficient, overstaffed, and virtually insolvent. In several ways, the reform introduced to the sector in 1989 under a World Bank-led project was remarkable. It showed that even in a weak institutional environment, where contracts are hard to enforce and political interference is common, private sector participation can improve sector performance. The authors discuss the mechanisms that made progress possible and identify factors that inhibit the positive effects of reform. Water has become very expensive, the number of connections has increased very slowly, and conflicts have developed between SEEG (the private operator) and SONEG (the state agency). Among the underlying problems: a) The lack of strong, stable institutions. b) The lack of an independent agency capable of restraining arbitrary government action, regulating the private operator...

The aim of this summary note is to highlight the technical complexity of the decentralization process in the Democratic Republic of Congo (DRC) as well as the risks and opportunities inherent in it. It also provides a review of the in-depth work conducted on the fiscal aspects of the decentralization process, which is crucial to obtain an understanding of the real life impact of the "40 percent" rule and the difficulties inherent in its practical application. It also provides an overview of potential solutions to the dilemmas faces by Democratic Republic of Congo's (DRC's) policy makers. In this regard, this note will review four key aspects of the decentralization process (fiscal aspects and competency transfers, human resource issues and capacity development, legal supervision issues, public investment management and the equalization fund) as well as a transversal analysis of the impact of these four aspects of the process on the education sector. This note, which is the result of joint work by experts from the World Bank and the European commission...

This thesis starts from the following question: Why, after 16 years of receiving Structural Funds, do some regions still have difficulties in spending their allocated resources? Empirical evidence shows that Funds implementation rates have varied widely among European Union Objective 1 regions. The overall performance of Italian regions, in particular, has consistently lagged behind other countries. However, an investigation into individual Italian Objective 1 regions reveals that not all follow this general trend. Indeed, some regions have outperformed others remarkably. Why is this the case? I explore these differences and identify potential variables that may account for such regional variation. My central hypothesis is that differences in implementation are strongly dependent on the degree of administrative capacity that exists in the recipient regional government. Due to the deficiency in the existing literature of a clear definition of administrative capacity, I attempt to fill this gap by introducing a novel characterization that allows me to operationalize and measure the concept. The core of the methodology is an in-depth case study supported by field research based on personal interviews and documented questionnaires. I investigate two contrasting southern Italian regions...