Decentralization and Popular Democracy: Governance from Below in Bolivia, by Jean-Paul Faguet.

This study is a welcome contribution to the literature on the workings of decentralization in developing countries. Understood as the devolution by a central government of political, administrative, and fiscal powers to local-level governments, the author explores the effects of decentralization on government performance across Bolivian municipalities. In contrast to much of the existing literature that uses a top-down approach to decentralization (i.e., treating it as a nationwide reform and expecting similar results regardless of local context), Faguet instead approaches the problem from the “bottom up”: since the key outcomes of decentralization are largely the aggregation of independent, local level, political processes; in order to understand decentralization, one needs to study how local governments work in the first place.

Based on a rich blend of qualitative and quantitative methods, and insights from disciplines such as public economics and comparative politics, Faguet exploits variation in local government performance across Bolivia to develop a unifying theory of the conditions under which accountable and responsive government emerges. In the empirical analysis, government performance is always measured using administrative budget data: public investment figures in different sectors, such as education, health, and infrastructure. In the theory, politics takes center stage: levels of political competition …