Across the world the relevance of local governments – states, provinces, and municipalities – has been increasing for a long time and decentralization has emerged as a dominating paradigm in Asia since the 1990s.
Pakistan has moved to a federal structure more than ten years ago and Nepal is moving toward fiscal federalism right now. In Bhutan, decentralization features prominently in the new Five-Year Plan and in India the 15th Finance Commission is concerned with subnational finance as well.
The World Bank and other developing partners have a long history supporting countries during their transition to political, administrative, and fiscal decentralization. Fiscal decentralization can improve allocative efficiency and preference matching and is often accompanied by stronger accountability and helpful competition between local governments. Hence, more responsibilities at the subnational level are usually expected to strengthen democracy, transparency, and especially to bring about more efficient service delivery.
However, evidence to confirm the success of past decentralization efforts is scare. Empirical studies find mixed evidence and successful decentralization seems to require certain conditions. Fiscal decentralization is a potentially threat to redistribution and bound to fail if scale effects are important or local capacity is very low. Consequently, there is ongoing debate about the appropriate locus of fiscal responsibility and decision making.
Against this backdrop, SANEM and the World Bank invite papers addressing one of the following (or related) questions:
- How is subnational finance affecting local service delivery in South Asia?
- How successful are decentralization efforts in South Asia in improving service delivery?
- What is the effect of fiscal decentralization on the efficiency of public services? Which conditions make decentralization efforts more successful?
- How can the measurement and reporting of subnational expenditure and subnational revenue in South Asia be strengthened?
While we will consider extended abstracts, we strongly encourage the submission of full papers. Travel costs of invited speakers from South Asia will be fully covered. The conference will feature different academic sessions as well as a special lecture and a high-level policy discussion.