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On the local politics of administrative decentralization: applying for policy
responsibilities in Ecuador
Faust, J.; Harbers, I.
DOI
10.1093/publius/pjq046
Publication date
2012
Document Version
Final published version
Published in
Publius - The Journal of Federalism
Link to publication
Citation for published version (APA):
Faust, J., & Harbers, I. (2012). On the local politics of administrative decentralization: applying
for policy responsibilities in Ecuador.
Publius - The Journal of Federalism
,
42
(1), 52-77.
https://doi.org/10.1093/publius/pjq046
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Download date:10 Aug 2022
On the Local Politics of Administrative
Decentralization: Applying for Policy
Responsibilities in Ecuador
Jo« rg Faust* and Imke Harbers
y
*German Development Institute; joerg.faust@die-gdi.de
y
University of Amsterdam; i.harbers@uva.nl
Variation in the behavior and preferences of subnational governments is one of the areas
that remain poorly understood by students of comparative decentralization and federalism. Yet,
evidence suggests that this variation plays an important role in shaping intergovernmental rela-
tions. Ecuador provides an especially interesting case for systematically exploring variation in the
behavior of municipalities. Rather than establishing a uniform division of competences between
levels of government, the 1998 constitution called on subnational governments to apply for policy
responsibilities. Using an original data set, our analysis demonstrates that, in addition to
national-level incentives, municipal-level political variablesçsuch as the government’s support
base and linkages to civil societyçhave a strong and significant impact on the behavior of local
governments.
In the past two decades advanced industrialized and developing countries alike
have moved toward more decentralized patterns of governance and decentralization
has attracted the interest of scholars from various disciplines. While our
understanding of decentralization has grown, the literature on decentralization
has tended to focus extensively on the comparison of countries or presiden-
tial administrations as units of analysis. Subnational governments have mostly
been treated as a homogeneous group as theoretical and empirical work has
tended to assume that they share common preferences and, therefore, behave
similarly during processes of decentralization. Consequently, variation in the
behavior of subnational governments has remained poorly understood (Wibbels
2006: 182).
The assumption that subnational governments share a set of preferences, which
has guided much of the literature, hampers our understanding of the degree and
shape of decentralized governance in contemporary democracies. Intergovernmental
Publius:The Journal of Federalism
volume 42 number1, pp. 52^77
doi:10.1093/publius/pjq046
Advance Acces s publication February 23, 2011
ß The Author 2011. Published by Oxford University Press on behalf of CSF Assoc iates: Publius, Inc.
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relations are not determined at one point in time and then remain unchanged.
They are more aptly understood as a sequence of political bargains between
governments, in which ‘‘the details of policy and the powers to make policies are
negotiated and renegotiated through time’’ (Congleton 2006: 132). Often,
constitutions and national framework legislations are vague and leave leeway for
adjustments. Therefore, heterogeneity of subnational governments with regard to
their interests and their ability to pursue these interests has often led to
considerable asymmetry between governments at the same level. While such
asymmetries in the distribution of fiscal and regulatory authority are widespread
and can be found in countries as different as Spain, China, and Venezuela, their
origins have remained under-theorized (Congleton 2006).
Renegotiations of bargains between governments at different levels occur in all
political systems over time, but the process of institutional change is likely to be
accelerated during periods of decentralization. Moreover, in many countries—
despite national framework legislation—subnational governments have considerable
discretionary leeway in assuming policy competences or refusing to do so. In this
article we aim to contribute to the literature on asymmetric federalism by offering a
theoretically grounded explanation of variation in the behavior of subnational
governments. Drawing on the public choice literature about the determinants of
public good provision we examine empirically how political factors at the
subnational level have influenced the process of administrative decentralization in
Ecuador.
Ecuador offers a rare opportunity to systematically study local-level influences
on the politics of administrative decentralization. First, Ecuador’s 19th constitution,
which was in effect from 1998 to 2008, established the principle of optional
decentralization, which calls on subnational governments to apply for policy
responsibilities rather than creating a uniform distribution of administrative
competences between levels of government. Thus, the national framework does not
constrain variation in the behavior of subnational governments, but gives local
governments the opportunity to pursue their interests. The observable heteroge-
neity in the behavior of subnational governments enables us to examine its
determinants. Second, Ecuador’s party system makes the country an interesting case
for analysis. On the one hand, the country has often been cited as one of the most
extreme cases of crises of representation in Latin America (e.g. Mainwaring 2006).
Its traditional parties have been severely criticized for having failed to fulfill their
task as intermediaries (e.g. Freidenberg, and Alca
´
ntara Sa
´
ez 2001). On the other
hand, the country has experienced the emergence of a lively civil society with a
substantial mobilizing capacity. In particular, the Ecuadorian indigenous
movement, which appeared during the 1990s, is still considered as one of the
strongest social movements in the Andean region and the affiliated party
Movimiento Unidad Plurinacional Pachakutik-Nuevo Paı
´
s has performed well
Local Politics of Administrative Decentralization 53
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electorally during our period of investigation from 2001 to 2004 (Van Cott 2005;
Madrid 2005; Mijeski and Beck 2008).
The findings of our comparative analysis suggest that political variables have a
strong and significant impact on the behavior of subnational governments. Our
data show that even in the absence of fiscal incentives, local governments with
broad popular support and municipalities governed by the indigenous party
Pachakutik—a party closely linked to civil society—have actively pursued
administrative decentralization. These findings are robust when we control for
demographic and financial characteristics of municipalities. Municipalities governed
by traditional, hierarchically organized and clientelistic parties, in contrast, have
been reluctant to demand administrative competences.
The article proceeds as follows. The first section lays out the theoretical
framework for the analysis and situates the present study in the context of
the comparative analysis of decentralization. The following section substantiates
our case selection and outlines the basic characteristics of Ecuador’s
decentralization framework. We then test our hypotheses about the deter-
minants of subnational variation on the basis of an original data set
of Ecuadorian municipalities. The article concludes with a discussion of our
findings.
The Decentralization Debate and the Puzzle of Subnational
Variation
Scholarship on decentralization has grown substantially in recent years. Yet, much
of the literature has tended to focus on the initial steps of decentralization reforms.
In tackling the question of why central governments choose to give up power,
researchers have concentrated on the motivations of actors located at the national
level, either within the executive (e.g. O’Neill 2005; Grindle 2000) or the legislature
(e.g. Escobar-Lemmon 2003; Willis, da Garman, and Haggard 1999). However,
even though in Latin America initial decisions to pursue decentralization reforms
have often been top-down, over time the reforms have created new stakeholders
and subnational governments have started to lobby for their interests more
assertively (Tulchin and Seele 2004: 10). Therefore, the focus on national-level
decision-makers becomes increasingly inadequate as decentralization processes
carry on (Montero 2001; Gonza
´
lez 2008). To come to a fuller understanding of
these reforms we therefore need to incorporate the preferences and behavior of
subnational governments.
Scholarship has often treated subnational governments en-bloc, building on the
assumption that they share a set of preferences. Yet, there is growing empirical
evidence that differences among subnational entities exert considerable influence on
their political behavior (e.g. Eaton 2004; Samuels 2003; Ferraz and Finan 2008;
54 J. Faust and I. Harbers
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Kauneckis and Andersson 2009). Far from being a unified bloc, subnational
governments are heterogeneous with regard to their policy preferences and
accordingly, behave differently in decentralized contexts and during decentraliza-
tion processes.
Asymmetric federal arrangements, where certain subnational entities pos-
sess more authority and powers than their peers, can be found in Spain (e.g. Galicia
and Catalonia), Canada (Quebec), and the UK (Wales and Scotland). While
a number of studies shed light on the dynamics of policy-making in
asymmetric systems (Swenden 2002; Bulmer et al. 2006), the origins of this
asymmetry, also called ‘menu federalism’ (Congleton 2006), have remained
under-theorized. The assumption that subnational governments are homog-
enous with regard to their preferences has hampered our ability to understand
and explain such arrangements. The optional decentralization frameworks
instituted by several countries, where local governments apply for policy
responsibilities, provide scholars with an opportunity to examine subnational
heterogeneity in action and to study the emergence of asymmetric federalism. In
Latin America, for instance, Ecuador, Peru (Polastri and Rojas 2006), and
Venezuela (Escobar-Lemmon 2003; de la Cruz and Legovini 2004) have opted for
national frameworks that allow subnational units to select administrative
competences.
Yet, the issue of subnational heterogeneity is relevant even where there is no
framework for optional decentralization. Especially in developing countries
variation of subnational behavior often occurs due to vagueness of legislation,
unclear assignment of shared competences or the failure of higher levels of
government to provide services effectively. In Indonesia, for example, the
decentralization framework left all responsibilities not assigned to the central or
provincial level to municipal districts. As competences were only vaguely defined,
districts were able to either actively pursue the transfer of competences through
negotiations with higher levels of government, or to abstain from the assumption
of additional responsibilities. In addition, individual subnational governments have
sometimes taken over responsibilities not formally assigned to them when higher
levels of government failed to provide the service. In South Africa, for instance,
where providing housing is formally a provincial task, some municipalities
have taken over this responsibility, even without a clear legal basis or additional
fiscal transfers (Heymans 2006: 66). In many developing countries, where central
governments with a limited presence have been unable or unwilling to provide
services to citizens throughout the national territory, local governments
have stepped into the void. Thus, for different reasons municipalities and
provinces in many countries have at least some leeway to behave according to their
preferences.
Local Politics of Administrative Decentralization 55
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