Decentralization and Regime Transformation
by
Pierre F. Landry
Assistant Professor
Department of Political Science
Yale University
P.O. Box 208301
New Haven, CT 06520-8301
Phone: 203/432-5016
Fax: 203/432-6196
Prepared for presentation at the
Annual Meeting of the
American Political Science Association
Panel 12-14: Decentralization and Public Service Delivery
September 2, 2005
Marriott Hotel, Washington, D.C.
Abstract:
This paper explores the relationship between decentralization and democracy around the world. Based on
cross-section time-evidence data that combines measures of fiscal decentralization with most complete
dataset of authoritarianism and democracy around the world, I find evidence of a causal link between
decentralization and democracy. Democracies are likely to favor fiscal decentralization. Moreover, the
decentralization of fiscal expenditures further reinforces the likelihood of democracy. This feedback loop
comes with twist, because revenue and expenditure decentralization have opposite impacts on the survival
of regimes. Autocracies that develop the capability to decentralize revenue collection are likely to endure,
as do democracies that decentralize spending authority. These findings help explain why some authoritarian
regimes have pursed decentralization strategies in an era where decentralization and democratization seem
highly correlated. As long as these regimes develop and maintain institutional mechanisms that allow them
to extract taxes locally while at the same time limiting the discretionary powers of local politicians by
centralizing expenditure assignments, authoritarian regimes can rationally adopt strategies of partial
decentralization.