Decentralization is a gerund or Decentraliz ing , not decentraliz ation

1. Decentralization is a gerundorDecentralizing, not decentralization Luis Crouch Lead Education Economist, HDNED - World Bank Lcrouch@worldbank.org

2. Some of our initial questions can’t really be answered • Every country’s decentralization is different • It is almost always part of a bigger set of reforms • It is never complete, changes at the margin (USA!) • Service-delivery considerations not central in determining shape and timing • Some centralized countries have efficient and equitable systems, some decentralizations are a total mess • No system ever fully decentralized or centralized, even in theory, much less in practice

3. Some of our initial questions can’t really be answered • “Do things right”vs.“do the right things?” • It is happening anyway, all over, so the premium is on doing it right; the “whether we should do it” debate is pretty academic (Anecdote.)

4. What does “decentralizing education” mean? • For a minute, forget the textbook definitions • Focus on: incentives (accountability) and information • Incentives to get information • Incentives to use information • Making information cheaper • Lowering costs of transactions and horse-trading in decision-making • By lowering numbers that have to be involved in the trading (one way to do so is autocracy… issue is how to do it in democracy?) • With that in mind, what does it mean?

5. What does “decentralizing education” mean? • Communities have different needs, teachers have different capabilities, etc. • Delivering good services therefore requires information: about what pupils want and need, about which teachers are good and which are no good, about what fixes schools need • Information is expensive and gets diluted and merged when it goes up the management chain • So, push decision down to those who can easily get information on how to act • Make them want to get the information (incentives, accountability) • Make them want to use it (incentives, accountability)

6. Why?

7. But… • What if whatever one region does causes problems or benefits for another region? • What if educated kids migrate? • What if everyone decides to use their own weights and measures? Their own tests, their own diplomas? • What if some areas are really poor? • These are “centralist” needs • Sometimes such needs over-ride the advantages of decentralization • (Note they are also above incentives and information…) • So there is some need for central functions

8. But that’s enough of “theory.”Rest of this presentation:1. What are the usual mistakes or issues that seem to recur?2. What are some practical things we could know more about?

9. Usual problems, recurrent mistakes • Lack of clarity • Management vs. governance • Who does what • Failure to recognize self-interested behavior (so, “mistakes” are not always true mistakes, just rational self-seeking behavior) • Lack of capacity

10. Lack of clarity in decentralizing management vs. governance • Decentralized management: give goals, give block grants, let lower levels decide how to “produce,” make own decisions (hiring, firing, buying, norming) but accountability (for goals) still upward • Decentralized governance: accountability is horizontal • Can do both, carefully • Related debate: reach the right depth: school autonomy, or just district decentralization (USA vs. other cases, Chile vs. Nicaragua examples)

11. Lack of clarity or poor decisions in who does what • Functions too broad: “education” is decentralized • Or even, “teacher management” is decentralized • Instead: analyze each function in detail • Also, though decisions political, technical input valuable, yet often little or none • Tech issues to balance: • Info incentives, loss, dilution • Accountability pressure • Economies of scale • Capacity • Spillovers • Homogeneity of information (weights and measures) Decentralize Centralize

12. Failure to watch out for self-interest • Self-interest from decentralized units conspires with self-interest at center to create unfunded, re-centralizing mandates • E.g., “sports teaching” interest in districts, together with sports interest in center create national norms for sports teaching as unfunded mandate • Many other examples… such as opportunities for corruption • Self-interest also in decentralizing of course, more local capture by local elites

13. Lack of capacity • Serious problem but... • Capacity can be created • Local capacity does not emerge, to be “further capacitated”until there is something real to manage so you have to start with decentralization • It takes time… • Yet, not taken seriously enough… • Key decentralizing countries have no systematic inventory of province or district capacity: none

14. This is all “known…”Expertise exists that can be transmitted, and can help make better decisions at the margin(Remember anecdote)What are some things we don’t know?

15. Things we (or I?) don’t know • What are good examples of org structure for apex ministry in a decentralized system? Does it matter? • What are reasonable staffing and spending proportions for apex ministry in a decentralized system? What should it depend on? (Depends on function, but…) • What are reasonable levels of output/input variability between districts, schools? When is too much variability a sign of insufficient accountability pressure from central location? Or insufficient capacity?

16. Things we don’t know • How to keep management and governance lines from mucking with each other? (US case?) • Or, how deep into school management does governance go? Do you need democratically-accountable decision to decide when to clean the toilets? • Are there good examples of successful and well-managed asymmetric autonomy? Where are the norms and checklists? • When to do it by “stealth” (Nicaragua, Honduras) vs. law (South Africa)? Pros and cons?

17. We don’t know… but we find out, even by trial and error, because decentralization is a gerund… we are all decentralizing or recentralizing… no one has reached the “right” and “final” stage of decentralization.