Decentralisation: Pros and Cons (theory and empirical evidence)



Year of publication 2014
Type Article in Proceedings
Conference Centralization Decentralization Debate Revisited
MU Faculty or unit

Faculty of Economics and Administration

Field Management and administrative
Keywords subsidiarity; decentralization; economies of scale; Central and Eastern Europe
Description The principle of subsidiarity represents the official “ideology” in Europe. Its meaning is explained in more detail in the European Charter for Local Self-Government. Signatory countries should respect the principles set out in the Charter, for example right to self-government of municipality or region, right to own financial income for municipality or regional budget, etc. This paper has three main goals. First, based on literature review, it discusses selected theoretical arguments for and against subsidiarity/decentralisation. Second, it shows examples of existing evidence about economies of scale in the CEE region and third, it also indicates region specific issues limiting the potential of decentralisation in the conditions of developing countries in Central and Eastern Europe. The main conclusions of paper are that decentralisation shall be understood as a tool and not as the definite goal. Decentralization cannot be sees as a one-dimensional strategy. Its outcomes and impacts will differ according to concrete time and environment. Finally, this strategy has to include all main involved elements such as legal, financial, territorial and ownership aspect of the process.
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