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{{Libertarianism sidebar}}{{Anarchism sidebar}}Decentralization is the process by which the activities of an organization, particularly those regarding planning and decision making, are distributed or delegated away from a central, authoritative location or group.Definition of decentralisation {{webarchive|url=|date=2013-01-26}}, Merriam-Webster Dictionary, accessed march 5 , 2013. Concepts of decentralization have been applied to group dynamics and management science in private businesses and organizations, political science, law and public administration, economics, money and technology.


File:Alexis de Tocqueville.jpg|thumb|left|upright|Alexis de TocquevilleAlexis de TocquevilleThe word "centralization" came into use in France in 1794 as the post-French Revolution French Directory leadership created a new government structure. The word "decentralization" came into usage in the 1820s.Vivien A. Schmidt, Democratizing France: The Political and Administrative History of Decentralization, Cambridge University Press, 2007, p. 22 {{webarchive|url= |date=2016-05-05 }}, {{ISBN|9780521036054}} "Centralization" entered written English in the first third of the 1800s;Barbara Levick, Claudius, Psychology Press, 2012, p. 81 {{webarchive|url= |date=2016-06-02 }}, {{ISBN|9780415166195}} mentions of decentralization also first appear during those years. In the mid-1800s Tocqueville would write that the French Revolution began with "a push towards decentralization...[but became,] in the end, an extension of centralization."Vivien A. Schmidt, Democratizing France: The Political and Administrative History of Decentralization, p. 10 {{webarchive|url= |date=2016-05-20 }}. In 1863 retired French bureaucrat Maurice Block wrote an article called "Decentralization" for a French journal which reviewed the dynamics of government and bureaucratic centralization and recent French efforts at decentralization of government functions.Robert Leroux, French Liberalism in the 19th Century: An Anthology, Chapter 6: Maurice Block on "Decentralization", Routledge, 2012, p. 255 {{webarchive|url= |date=2016-05-29 }}, {{ISBN|9781136313011}}Ideas of liberty and decentralization were carried to their logical conclusions during the 19th and 20th centuries by anti-state political activists calling themselves "anarchists", "libertarians", and even decentralists. Tocqueville was an advocate, writing: "Decentralization has, not only an administrative value, but also a civic dimension, since it increases the opportunities for citizens to take interest in public affairs; it makes them get accustomed to using freedom. And from the accumulation of these local, active, persnickety freedoms, is born the most efficient counterweight against the claims of the central government, even if it were supported by an impersonal, collective will."A History of Decentralization {{webarchive|url= |date=2013-05-11 }}, Earth Institute of Columbia University website, accessed February 4, 2013. Pierre-Joseph Proudhon (1809–1865), influential anarchist theoristBOOK, Encyclopedia Americana, George Edward Rines, 1918, Encyclopedia Americana Corp., New York, 7308909, 624, Encyclopedia Americana, BOOK, Hamilton, Peter, Émile Durkheim, Routledge, New York, 1995, 978-0415110471, 79, wrote: "All my economic ideas as developed over twenty-five years can be summed up in the words: agricultural-industrial federation. All my political ideas boil down to a similar formula: political federation or decentralization.""Du principe Fédératif" ("Principle of Federation"), 1863.In early twentieth century, America's response to the centralization of economic wealth and political power was a decentralist movement. It blamed large-scale industrial production for destroying middle class shop keepers and small manufacturers and promoted increased property ownership and a return to small scale living. The decentralist movement attracted Southern Agrarians like Robert Penn Warren, as well as journalist Herbert Agar.Craig R. Prentiss, Debating God's Economy: Social Justice in America on the Eve of Vatican II, Penn State Press, 2008, p. 43 {{webarchive|url= |date=2016-05-03 }}, {{ISBN|9780271033419}} New Left and libertarian individuals who identified with social, economic, and often political decentralism through the ensuing years included Ralph Borsodi, Wendell Berry, Paul Goodman, Carl Oglesby, Karl Hess, Donald Livingston, Kirkpatrick Sale (author of Human Scale),ENCYCLOPEDIA, Kauffman, Bill, Bill Kauffman, Ronald, Hamowy, Ronald Hamowy, The Encyclopedia of Libertarianism,weblink 2008, SAGE Publications, Cato Institute, Thousand Oaks, CA, 10.4135/9781412965811.n71, 978-1-4129-6580-4, 750831024, 2008009151, 111–13, live,weblink 2016-05-01, Decentralism, The Encyclopedia of Libertarianism, Murray Bookchin,David De Leon, Leaders from the 1960s: A Biographical Sourcebook of American Activism, Greenwood Publishing Group, 1994, p. 297 {{webarchive|url= |date=2015-11-05 }}, {{ISBN|9780313274145}} Dorothy Day,Nancy L. Roberts, Dorothy Day and the Catholic worker, Volume 84, Issue 1 of National security essay series, State University of New York Press, 1984, p. 11 {{webarchive|url= |date=2016-05-17 }}, {{ISBN|9780873959391}} Senator Mark O. Hatfield,Jesse Walker, Mark O. Hatfield, RIP {{webarchive|url= |date=2013-06-03 }}, Reason, August 8, 2011. Mildred J. LoomisMildred J. Loomis, Decentralism: Where It Came From – Where Is It Going?, Black Rose Books, 2005, {{ISBN|9781551642499}} and Bill Kauffman.Bill Kauffman, Bye Bye, Miss American Empire: Neighborhood Patriots, Backcountry rebels, Chelsea Green Publishing, 2010, p. xxxi {{webarchive|url= |date=2016-05-05 }}, {{ISBN|9781933392806}}(File:Megatrendsbookcover.jpg|thumb|right|upright=0.55|Decentralization was one of ten Megatrends identified in this best seller.)Leopold Kohr, author of the 1957 book The Breakdown of Nations – known for its statement "Whenever something is wrong, something is too big" – was a major influence on E.F. Schumacher, author of the 1973 bestseller (Small is Beautiful|Small is Beautiful:Economics As If People Mattered) .Dr. Leopold Kohr, 84; Backed Smaller States {{webarchive|url= |date=2017-01-18 }}, The New York Times obituary, February 28, 1994.John Fullerton, The Relevance of E. F. Schumacher in the 21st Century {{webarchive|url= |date=2013-04-05 }}, New Economics Institute, accessed February 7, 2013. In the next few years a number of best-selling books promoted decentralization.Daniel Bell's The Coming of Post-Industrial Society discussed the need for decentralization and a "comprehensive overhaul of government structure to find the appropriate size and scope of units", as well as the need to detach functions from current state boundaries, creating regions based on functions like water, transport, education and economics which might have "different 'overlays' on the map."W. Patrick McCray, The Visioneers: How a Group of Elite Scientists Pursued Space Colonies, Nanotechnlogies, and a Limitless Future, Princeton University Press, 2012, p. 70 {{webarchive|url= |date=2016-05-14 }}, {{ISBN|9780691139838}}Daniel Bell, The Coming Of Post-industrial Society, Basic Books version, 2008, p. 320–21 {{webarchive|url= |date=2016-05-16 }}, {{ISBN|9780786724734}} Alvin Toffler published Future Shock (1970) and The Third Wave (1980). Discussing the books in a later interview, Toffler said that industrial-style, centralized, top-down bureaucratic planning would be replaced by a more open, democratic, decentralized style which he called "anticipatory democracy".Alvin Toffler, Previews & Premises: An Interview with the Author of Future Shock and The Third Wave, Black Rose books, 1987, p. 50 {{webarchive|url= |date=2016-05-08 }}, {{ISBN|9780920057377}} Futurist John Naisbitt's 1982 book "Megatrends" was on The New York Times Best Seller list for more than two years and sold 14 million copies.John Naisbitt biography {{webarchive|url= |date=2013-09-16 }} at personal website, accessed February 10, 2013. Naisbitt's book outlines 10 "megatrends", the fifth of which is from centralization to decentralization.Sam Inkinen, Mediapolis: Aspects of Texts, Hypertexts and Multimedial Communication, Volume 25 of Research in Text Theory, Walter de Gruyter, 1999, p. 272 {{webarchive|url= |date=2016-04-28 }}, {{ISBN|9783110807059}} In 1996 David Osborne and Ted Gaebler had a best selling book Reinventing Government proposing decentralist public administration theories which became labeled the "New Public Management".JOURNAL, Public Administration Review, 56, 3, May–June 1996, 247–55, Role of the "Reinventing Government" Movement in Federal Management Reform, Kamensky, John M., 10.2307/976448, 976448, Stephen Cummings wrote that decentralization became a "revolutionary megatrend" in the 1980s.Stephen Cummings, ReCreating Strategy, SAGE, 2002, p. 157 {{webarchive|url= |date=2016-05-22 }}, {{ISBN|9780857026514}} In 1983 Diana Conyers asked if decentralization was the "latest fashion" in development administration.Diana Conyers, "Decentralization: The latest fashion in development administration?" {{webarchive|url= |date=2014-05-22 }}, Public Administration and Development, Volume 3, Issue 2, pp. 97–109, April/June 1983, via Wiley Online Library, accessed February 4, 2013. Cornell University's project on Restructuring Local Government states that decentralization refers to the "global trend" of devolving responsibilities to regional or local governments.Decentralization {{webarchive|url= |date=2012-10-26 }}, article at the "Restructuring local government project {{webarchive|url= |date=2013-01-17 }}" of Dr. Mildred Warner, Cornell University, accessed February 4, 2013. Robert J. Bennett's Decentralization, Intergovernmental Relations and Markets: Towards a Post-Welfare Agenda describes how after World War II governments pursued a centralized "welfarist" policy of entitlements which now has become a "post-welfare" policy of intergovernmental and market-based decentralization.In 1983, "Decentralization" was identified as one of the "Ten Key Values" of the Green Movement in the United States.According to a 1999 United Nations Development Programme report:}}


Systems approach

File:Decentralization.jpg|thumb|Graphical comparison of centralized and decentralized systemdecentralized systemThose studying the goals and processes of implementing decentralization often use a systems theory approach. The United Nations Development Programme report applies to the topic of decentralization "a whole systems perspective, including levels, spheres, sectors and functions and seeing the community level as the entry point at which holistic definitions of development goals are most likely to emerge from the people themselves and where it is most practical to support them. It involves seeing multi-level frameworks and continuous, synergistic processes of interaction and iteration of cycles as critical for achieving wholeness in a decentralized system and for sustaining its development.""Decentralization: A Sampling of Definitions", 1999, p. 13.However, has been seen as part of a systems approach. Norman Johnson of Los Alamos National Laboratory wrote in a 1999 paper: "A decentralized system is where some decisions by the agents are made without centralized control or processing. An important property of agent systems is the degree of connectivity or connectedness between the agents, a measure global flow of information or influence. If each agent is connected (exchange states or influence) to all other agents, then the system is highly connected."JOURNAL, Norman L., Johnson, Diversity in Decentralized Systems: Enabling Self-Organizing Solutions,, Theoretical Division, Los Alamos National Laboratory, for University of California Los Angeles 1999 conference "Decentralization Two", University of California, Irvine's Institute for Software Research's "PACE" project is creating an "architectural style for trust management in decentralized applications." It adopted Rohit Khare's definition of decentralization: "A decentralized system is one which requires multiple parties to make their own independent decisions" and applies it to Peer-to-peer software creation, writing:, University of California, Irvine's Institute for Software Research, Last Updated – May 10, 2006.}}


Decentralization in any area is a response to the problems of centralized systems. Decentralization in government, the topic most studied, has been seen as a solution to problems like economic decline, government inability to fund services and their general decline in performance of overloaded services, the demands of minorities for a greater say in local governance, the general weakening legitimacy of the public sector and global and international pressure on countries with inefficient, undemocratic, overly centralized systems.Holger Daun, School Decentralization in the Context of Globalizing Governance: International Comparison of Grassroots Responses, Springer, 2007, pp. 28–29 {{webarchive|url= |date=2016-06-17 }},{{ISBN|9781402047008}} The following four goals or objectives are frequently stated in various analyses of decentralization.ParticipationIn decentralization the principle of subsidiarity is often invoked. It holds that the lowest or least centralized authority which is capable of addressing an issue effectively should do so. According to one definition: "Decentralization, or decentralizing governance, refers to the restructuring or reorganization of authority so that there is a system of co-responsibility between institutions of governance at the central, regional and local levels according to the principle of subsidiarity, thus increasing the overall quality and effectiveness of the system of governance, while increasing the authority and capacities of sub-national levels.""Decentralization: A Sampling of Definitions", 1999, pp. 2, 16, 26.Decentralization is often linked to concepts of participation in decision-making, democracy, equality and liberty from higher authority.Subhabrata Dutta, Democratic decentralization and grassroot leadership in India {{webarchive|url= |date=2015-03-19 }}, Mittal Publications, 2009, pp. 5–8, {{ISBN|9788183242738}}Robert Charles Vipond, Liberty & Community: Canadian Federalism and the Failure of the Constitution {{webarchive|url= |date=2016-06-24 }}, SUNY Press, 1991, p. 145, {{ISBN|9780791404669}} Decentralization enhances the democratic voice. Theorists believe that local representative authorities with actual discretionary powers are the basis of decentralization that can lead to local efficiency, equity and development."JOURNAL, Ribot, J, Democratic Decentralisation of Natural Resources: Institutional Choice and Discretionary Power Transfers in Sub-Saharan Africa, Public Administration and Development, 2003, 23, 53–65, 10.1002/pad.259, Columbia University's Earth Institute identified one of three major trends relating to decentralization as: "increased involvement of local jurisdictions and civil society in the management of their affairs, with new forms of participation, consultation, and partnerships."Decentralization has been described as a "counterpoint to globalization [which] removes decisions from the local and national stage to the global sphere of multi-national or non-national interests. Decentralization brings decision-making back to the sub-national levels". Decentralization strategies must account for the interrelations of global, regional, national, sub-national, and local levels."Decentralization: A Sampling of Definitions", 1999, pp. 12–13.DiversityNorman L. Johnson writes that diversity plays an important role in decentralized systems like ecosystems, social groups, large organizations, political systems. "Diversity is defined to be unique properties of entities, agents, or individuals that are not shared by the larger group, population, structure. Decentralized is defined as a property of a system where the agents have some ability to operate "locally." Both decentralization and diversity are necessary attributes to achieve the self-organizing properties of interest."Advocates of political decentralization hold that greater participation by better informed diverse interests in society will lead to more relevant decisions than those made only by authorities on the national level.Political Decentralization {{webarchive|url= |date=2013-04-09 }}, Decentralization and Subnational Economies project, World Bank website, accessed February 9, 2013. Decentralization has been described as a response to demands for diversity.Therese A McCarty, Demographic diversity and the size of the public sector {{webarchive|url= |date=2014-05-22 }}, Kyklos, 1993, via Wiley Online Library. Quote: "...if demographic diversity promotes greater decentralization, the size of the publicsector is not affected 10 consequently."EfficiencyIn business, decentralization leads to a management by results philosophy which focuses on definite objectives to be achieved by unit results."Decentralization: A Sampling of Definitions", 1999, p. 11. Decentralization of government programs is said to increase efficiency – and effectiveness – due to reduction of congestion in communications, quicker reaction to unanticipated problems, improved ability to deliver services, improved information about local conditions, and more support from beneficiaries of programs.Jerry M. Silverman, Public Sector Decentralization: Economic Policy and Sector Investment Programs, Volume 188, World Bank Publications, 1992, p. 4 {{webarchive|url= |date=2016-05-28 }}, {{ISBN|9780821322796}}Firms may prefer decentralization because it ensures efficiency by making sure that managers closest to the local information make decisions and in a more timely fashion; that their taking responsibility frees upper management for long term strategics rather than day-to-day decision-making; that managers have hands on training to prepare them to move up the management hierarchy; that managers are motivated by having the freedom to exercise their own initiative and creativity; that managers and divisions are encouraged to prove that they are profitable, instead of allowing their failures to be masked by the overall profitability of the company.Don R. Hansen, Maryanne M. Mowen, Liming Guan, Cost Management: Accounting & Control, Cengage Learning, 2009, p. 338 {{webarchive|url= |date=2016-05-13 }}, {{ISBN|9780324559675}}The same principles can be applied to government. Decentralization promises to enhance efficiency through both inter-governmental competition with market features and fiscal discipline which assigns tax and expenditure authority to the lowest level of government possible. It works best where members of subnational government have strong traditions of democracy, accountability and professionalism.Conflict resolutionEconomic and/or political decentralization can help prevent or reduce conflict because they reduce actual or perceived inequities between various regions or between a region and the central government.David R. Cameron, Gustav Ranis, Annalisa Zinn, Globalization and Self-Determination: Is the Nation-State Under Siege?, Taylor & Francis, 2006, p. 203 {{webarchive|url= |date=2016-05-03 }}, {{ISBN|9780203086636}} Dawn Brancati finds that political decentralization reduces intrastate conflict unless politicians create political parties that mobilize minority and even extremist groups to demand more resources and power within national governments. However, the likelihood this will be done depends on factors like how democratic transitions happen and features like a regional party's proportion of legislative seats, a country's number of regional legislatures, elector procedures, and the order in which national and regional elections occur. Brancati holds that decentralization can promote peace if it encourages statewide parties to incorporate regional demands and limit the power of regional parties.Dawn Brancati, Peace by Design:Managing Intrastate Conflict through Decentralization, Oxford University Press, 2009, {{ISBN|9780191615221}}


The processes by which entities move from a more to a less centralized state vary. They can be initiated from the centers of authority ("(wikt:top-down|top-down)") or from individuals, localities or regions ("bottom-up"),Ariunaa Lkhagvadorj, Fiscal federalism and decentralization in Mongolia, University of Potsdam, Germany, 2010, p. 23 {{webarchive|url= |date=2016-06-10 }}, {{ISBN|9783869560533}} or from a "mutually desired" combination of authorities and localities working together.Karin E. Kemper, Ariel Dinar, Integrated River Basin Management Through Decentralization, Springer, 2007, p. 36 {{webarchive|url= |date=2016-04-25 }}, {{ISBN|9783540283553}}. Bottom-up decentralization usually stresses political values like local responsiveness and increased participation and tends to increase political stability. Top-down decentralization may be motivated by the desire to "shift deficits downwards" and find more resources to pay for services or pay off government debt. Some hold that decentralization should not be imposed, but done in a respectful manner."Decentralization: A Sampling of Definitions", 1999, p. 12.Appropriate sizeGauging the appropriate size or scale of decentralized units has been studied in relation to the size of sub-units of hospitalsRobert J. Taylor, Susan B. Taylor, The Aupha Manual of Health Services Management, Jones & Bartlett Learning, 1994, p. 33, {{ISBN|9780834203631}} and schools, road networks,Frannie Frank Humplick, Azadeh Moini Araghi, "Is There an Optimal Structure for Decentralized Provision of Roads?", World Bank Policy Research Working Paper, 1996, p. 35. administrative units in businessAbbass F. Alkhafaji, Strategic Management: Formulation, Implementation, and Control in a Dynamic Environment, Psychology Press, 2003, p. 184, {{ISBN|9780789018106}} and public administration, and especially town and city governmental areas and decision making bodies.Ehtisham Ahmad, Vito Tanzi, Managing Fiscal Decentralization, Routledge, 2003, p. 182 {{webarchive|url= |date=2016-05-27 }}, {{ISBN|9780203219997}}Aaron Tesfaye, Political Power and Ethnic Federalism: The Struggle for Democracy in Ethiopa, University Press of America, 2002, p. 44 {{webarchive|url= |date=2016-05-02 }}, {{ISBN|9780761822394}}In creating planned communities ("new towns"), it is important to determine the appropriate population and geographical size. While in earlier years small towns were considered appropriate, by the 1960s, 60,000 inhabitants was considered the size necessary to support a diversified job market and an adequate shopping center and array of services and entertainment. Appropriate size of governmental units for revenue raising also is a consideration.Harry Ward Richardson, Urban economics, Dryden Press, 1978, pp. 107, 133, 159 {{webarchive|url= |date=2016-05-13 }}.Even in bioregionalism, which seeks to reorder many functions and even the boundaries of governments according to physical and environmental features, including watershed boundaries and soil and terrain characteristics, appropriate size must be considered. The unit may be larger than many decentralist bioregionalists prefer.Allen G Noble, Frank J. Costa, Preserving the Legacy: Concepts in Support of Sustainability, Lexington Books, 1999, p. 214 {{webarchive|url= |date=2016-05-13 }}, {{ISBN|9780739100158}}
Inadvertent or silent
Decentralization ideally happens as a careful, rational, and orderly process, but it often takes place during times of economic and political crisis, the fall of a regime and the resultant power struggles. Even when it happens slowly, there is a need for experimentation, testing, adjusting, and replicating successful experiments in other contexts. There is no one blueprint for decentralization since it depends on the initial state of a country and the power and views of political interests and whether they support or oppose decentralization."Decentralization: A Sampling of Definitions", 1999, p. 21.Decentralization usually is conscious process based on explicit policies. However, it may occur as "silent decentralization" in the absence of reforms as changes in networks, policy emphasize and resource availability lead inevitably to a more decentralized system.H.F.W. Dubois and G. Fattore, Definitions and typologies in public administration research: the case of decentralization, International Journal of Public Administration, Volume 32, Issue 8, 2009, pp. 704–27.
Decentralization may be uneven and "asymmetric" given any one country's population, political, ethnic and other forms of diversity. In many countries, political, economic and administrative responsibilities may be decentralized to the larger urban areas, while rural areas are administered by the central government. Decentralization of responsibilities to provinces may be limited only to those provinces or states which want or are capable of handling responsibility. Some privatization may be more appropriate to an urban than a rural area; some types of privatization may be more appropriate for some states and provinces but not others."Decentralization: A Sampling of Definitions", 1999, p. 19.
Measuring the amount of decentralization, especially politically, is difficult because different studies of it use different definitions and measurements. An OECD study quotes Chanchal Kumar Sharma as stating:OECD, 2013, Fiscal Federalism Studies Measuring Fiscal Decentralisation: Concepts and Policies {{webarchive|url= |date=2016-04-23 }}, OECD, Korea Institute of Public Finance "a true assessment of the degree of decentralization in a country can be made only if a comprehensive approach is adopted and rather than trying to simplify the syndrome of characteristics into the single dimension of autonomy, interrelationships of various dimensions of decentralization are taken into account."Chanchal Kumar Sharma, Decentralization Dilemma: Measuring the Degree and Evaluating the Outcomes {{webarchive|url= |date=2011-05-01 }}, The Indian Journal of Political Science, Vol. 67, No. 1, 2006, pp. 49–64.

Determinants of decentralization

The academic literature frequently mentions the following factors as determinants of decentralization:BOOK, Globalization and Self-Determination, Cameron, David R., Ranis, Gustav, Zinn, Annalisa, 2006-04-12, Routledge, 9780415770224, 10.4324/9780203086636,
  • "The number of major ethnic groups"
  • "The degree of territorial concentration of those groups"
  • "The existence of ethnic networks and communities across the border of the state"
  • "The country’s dependence on natural resources and the degree to which those resources are concentrated in the region’s territory"
  • "The country’s per capita income relative to that in other regions"
  • The presence of self-determination movements

Government decentralization

Historians have described the history of governments and empires in terms of centralization and decentralization. In his 1910 The History of Nations Henry Cabot Lodge wrote that Persian king Darius I (550–486 BC) was a master of organization and "for the first time in history centralization becomes a political fact." He also noted that this contrasted with the decentralization of Ancient Greece.Henry Cabot Lodge, Volume 1 of The History of Nations, H. W. Snow, 1910, p. 164 {{webarchive|url= |date=2016-05-01 }}. Since the 1980s a number of scholars have written about cycles of centralization and decentralizations. Stephen K. Sanderson wrote that over the last 4000 years chiefdoms and actual states have gone through sequences of centralization and decentralization of economic, political and social power.Stephen K. Sanderson, Civilizations and World Systems: Studying World-Historical Change, Rowman & Littlefield, 1995, pp. 118–19 {{webarchive|url= |date=2016-04-25 }}, {{ISBN|9780761991052}} Yildiz Atasoy writes this process has been going on "since the Stone Age" through not just chiefdoms and states, but empires and today's "hegemonic core states".Yildiz Atasoy, Hegemonic Transitions, the State and Crisis in Neoliberal Capitalism, Volume 7 of Routledge Studies in Governance and Change in the Global Era, Taylor & Francis US, 2009, pp. 65–67 {{webarchive|url= |date=2016-06-17 }}, {{ISBN|9780415473842}} Christopher K. Chase-Dunn and Thomas D. Hall review other works that detail these cycles, including works which analyze the concept of core elites which compete with state accumulation of wealth and how their "intra-ruling-class competition accounts for the rise and fall of states" and of their phases of centralization and decentralization.Christopher K. Chase-Dunn, Thomas D. Hall, Rise and Demise: Comparing World Systems'', Westview Press, 1997, pp. 20, 33 {{webarchive|url= |date=2016-05-17 }}, {{ISBN|9780813310060}}Rising government expenditures, poor economic performance and the rise of free market-influenced ideas have convinced governments to decentralize their operations, to induce competition within their services, to contract out to private firms operating in the market, and to privatize some functions and services entirely.Editors: S. N. Mishra, Anil Dutta Mishra, Sweta Mishra, Public Governance and Decentralisation: Essays in Honour of T.N. Chaturvedi, Mittal Publications, 2003, p. 229 {{webarchive|url= |date=2016-05-01 }}, {{ISBN|9788170999188}}File:East Province districts.png|thumb|East Province, RwandaEast Province, RwandaGovernment decentralization has both political and administrative aspects. Its decentralization may be territorial, moving power from a central city to other localities, and it may be functional, moving decision-making from the top administrator of any branch of government to lower level officials, or divesting of the function entirely through privatization."Decentralization: A Sampling of Definitions", 1999, pp. 5–8. It has been called the "new public management" which has been described as decentralization, management by objectives, contracting out, competition within government and consumer orientation.Managing Decentralisation: A New Role for Labour Market Policy, Organisation for Economic Co-operation and Development, Local Economic and Employment Development (Program), OECD Publishing, 2003, p 135 {{webarchive|url= |date=2016-04-30 }}, {{ISBN|9789264104709}}


Political decentralization signifies a reduction in the authority of national governments over policymaking. This process is accomplished by the institution of reforms that either delegate a certain degree of meaningful decision-making autonomy to subnational tiers of government, or grant citizens the right to elect lower-level officials, like local or regional representatives.BOOK, The architecture of government: rethinking political decentralization, Treisman, Daniel, Cambridge University Press, 2007, 9780521872294, Depending on the country, this may require constitutional or statutory reforms, the development of new political parties, increased power for legislatures, the creation of local political units, and encouragement of advocacy groups.A national government may decide to decentralize its authority and responsibilities for a variety of reasons. Decentralization reforms may occur for administrative reasons, when government officials decide that certain responsibilities and decisions would be handled best at the regional or local level. In democracies, traditionally conservative parties include political decentralization as a directive in their platforms because rightist parties tend to advocate for a decrease in the role of central government. There is also strong evidence to support the idea that government stability increases the probability of political decentralization, since instability brought on by gridlock between opposing parties in legislatures often impedes a government's overall ability to enact sweeping reforms.JOURNAL, Spina, Nicholas, July 2013, Explaining political decentralization in parliamentary democracies,weblink Comparative European Politics, 11, 4, 428–457, ProQuest, 10.1057/cep.2012.23, The rise of regional ethnic parties in the national politics of parliamentary democracies is also heavily associated with the implementation of decentralization reforms. Ethnic parties may endeavor to transfer more autonomy to their respective regions, and as a partisan strategy, ruling parties within the central government may cooperate by establishing regional assemblies in order to curb the rise of ethnic parties in national elections. This phenomenon famously occurred in 1999, when the United Kingdom's Labour Party appealed to Scottish constituents by creating a semi-autonomous Scottish Parliament in order to neutralize the threat from the increasingly popular Scottish National Party at the national level.In addition to increasing the administrative efficacy of government and endowing citizens with more power, there are many projected advantages to political decentralization. Individuals who take advantage of their right to elect local and regional authorities have been shown to have more positive attitudes toward politics,JOURNAL, Rosenblatt, Fernando, Bidegain, Germán, Monestier, Felipe, Rodríguez, Rafael Piñeiro, 2015, A Natural Experiment in Political Decentralization: Local Institutions and Citizens' Political Engagement in Uruguay, Latin American Politics and Society, en, 57, 2, 91–110, 10.1111/j.1548-2456.2015.00268.x, 1531-426X, and increased opportunities for civic decision-making through participatory democracy mechanisms like public consultations and participatory budgeting are believed to help legitimize government institutions in the eyes of marginalized groups.JOURNAL, Lyon, Aisling, 2015, Political decentralization and the strengthening of consensual, participatory local democracy in the Republic of Macedonia, Democratization, 22, 157–178, 10.1080/13510347.2013.834331, Moreover, political decentralization is perceived as a valid means of protecting marginalized communities at a local level from the detrimental aspects of development and globalization driven by the state, like the degradation of local customs, codes, and beliefs.JOURNAL, James, Manor, 1999-03-31, The political economy of democratic decentralization,weblink en, In his 2013 book, Democracy and Political Ignorance, George Mason University law professor Ilya Somin argued that political decentralization in a federal democracy confronts the widespread issue of political ignorance by allowing citizens to engage in foot voting, or moving to other jurisdictions with more favorable laws.BOOK, Democracy and Political Ignorance: Why Smaller Government is Smarter, Somin, Ilya, Stanford University Press, 2013, 9780804789318, ProQuest, He cites the mass migration of over one million southern-born African Americans to the North or the West to evade discriminatory Jim Crow laws in the late 19th century and early 20th century.The European Union follows the principle of subsidiarity, which holds that decision-making should be made by the most local competent authority. The EU should decide only on enumerated issues that a local or member state authority cannot address themselves. Furthermore, enforcement is exclusively the domain of member states. In Finland, the Centre Party explicitly supports decentralization. For example, government departments have been moved from the capital Helsinki to the provinces. The Centre supports substantial subsidies that limit potential economic and political centralization to Helsinki .Political decentralization does not come without its drawbacks. A study by Fan concludes that there is an increase in corruption and rent-seeking when there are more vertical tiers in the government, as well as when there are higher levels of subnational government employment.JOURNAL, Fan, C. Simon, Lin, Chen, Treisman, Daniel, February 2009, Political decentralization and corruption: Evidence from around the world, Journal of Public Economics, 93, 1–2, 14–34, 10.1016/j.jpubeco.2008.09.001, 0047-2727, Other studies warn of high-level politicians that may intentionally deprive regional and local authorities of power and resources when conflicts arise. In order to combat these negative forces, experts believe that political decentralization should be supplemented with other conflict management mechanisms like power-sharing, particularly in regions with ethnic tensions.


Four major forms of administrative decentralization have been described.Different forms of decentralization {{webarchive|url= |date=2013-05-26 }}, Earth Institute of Columbia University, accessed February 5, 2013."Decentralization: A Sampling of Definitions", 1999, p. 8.
  • Deconcentration, the weakest form of decentralization, shifts responsibility for decision-making, finance and implementation of certain public functionsBy the way chosen by the Italian Supreme Court, the regional legislature is allowed to add its administrative penalties to national criminal punishment: JOURNAL, Buonomo, Giampiero, Patrimonio dello Stato: le norme speciali e il taglio abusivo di bosco, Diritto&Giustizia Edizione Online, 2004,weblink live,weblink 2016-03-24, {{Subscription required |via=Questia}} from officials of central governments to those in existing districts or, if necessary, new ones under direct control of the central government.
  • Delegation passes down responsibility for decision-making, finance and implementation. It involves the creation of public-private enterprises or corporations, or of "authorities", special projects or service districts. All of them will have a great deal of decision-making discretion and they may be exempt from civil service requirements and may be permitted to charge users for services.
  • Devolution transfers responsibility for decision-making, finance and implementation of certain public functions to the sub-national level, such as a regional, local, or state government.
  • Divestment, also called privatization, may mean merely contracting out services to private companies. Or it may mean relinquishing totally all responsibility for decision-making, finance and implementation of certain public functions. Facilities will be sold off, workers transferred or fired and private companies or non-for-profit organizations allowed to provide the services.Summary of Janet Kodras {{webarchive|url= |date=2012-06-16 }}, "Restructuring the State: Devolution, Privatization, and the Geographic Redistribution of Power and Capacity in Governance", from State Devolution in America: Implications for a Diverse Society, Edited by Lynn Staeheli, Janet Kodras, and Colin Flint, Urban Affairs Annual Reviews 48, SAGE, 1997, pp. 79–68 at Restructuring local government project {{webarchive|url= |date=2013-01-17 }} website. Many of these functions originally were done by private individuals, companies, or associations and later taken over by the government, either directly, or by regulating out of business entities which competed with newly created government programs.John Stossel, "Private charity would do much more – if government hadn't crowded it out {{webarchive|url= |date=2013-02-09 }}", Jewish World Review, August 24, 2005.


Fiscal decentralization means decentralizing revenue raising and/or expenditure of moneys to a lower level of government while maintaining financial responsibility. While this process usually is called fiscal federalism it may be relevant to unitary, federal and confederal governments. Fiscal federalism also concerns the "vertical imbalances" where the central government gives too much or too little money to the lower levels. It actually can be a way of increasing central government control of lower levels of government, if it is not linked to other kinds of responsibilities and authority.David King, Fiscal Tiers: The Economics of Multilevel Government, George Allen and Unwin, 1984.Nico Groenendijk, "Fiscal federalism Revisited" paper presented at Institutions in Transition Conference organized by IMAD, Slovenia Ljublijana."Decentralization: A Sampling of Definitions", 1999, p. 18.Fiscal decentralization can be achieved through user fees, user participation through monetary or labor contributions, expansion of local property or sales taxes, intergovernmental transfers of central government tax monies to local governments through transfer payments or grants, and authorization of municipal borrowing with national government loan guarantees. Transfers of money may be given conditionally with instructions or unconditionally without them.Intergovernmental Fiscal Relations {{webarchive|url= |date=2013-06-16 }}, Decentralization and Subnational Economies project, World Bank website, accessed February 9, 2013.


Market decentralization can be done through privatization of public owned functions and businesses, as described briefly above. But it also is done through deregulation, the abolition of restrictions on businesses competing with government services, for example, postal services, schools, garbage collection. Even as private companies and corporations have worked to have such services contracted out to or privatized by them, others have worked to have these turned over to non-profit organizations or associations,Since the 1970s there has been deregulation of some industries, like banking, trucking, airlines and telecommunications which resulted generally in more competition and lower prices. {{citation needed|date=May 2014}} According to Cato Institute, an American libertarian think-tank, some industries deregulation of aspects of an industry were offset by more ambitious regulations elsewhere that hurt consumers, the electricity industry being a prime example.Jerry Taylor and Peter Van Doren, Short-Circuited {{webarchive|url= |date=2013-06-17 }}, The Wall Street Journal, August 30, 2007, reprinted at Cato Institute website. For example, in banking, Cato Institute believes some deregulation allowed banks to compete across state lines, increasing consumer choice, while an actual increase in regulators and regulations forced banks to do business the way central government regulators commanded, including making loans to individuals incapable of repaying them, leading eventually to the financial crisis of 2007–2008.Mark A. Calabria, Did Deregulation Cause the Financial Crisis? {{webarchive|url= |date=2013-06-17 }}, Cato Policy Report, July/August 2009, Vol. XXXI No. 4 pp. 1, 6–8. {{unreliable source?|date=May 2014}}One example of economic decentralization, which is based on a libertarian socialist model, is decentralized economic planning. Decentralized planning is a type of economic system in which decision-making is distributed amongst various economic agents or localized within production agents. An example of this method in practice is in Kerala, India which started in 1996 as, The People's Planning in Kerala.WEB,weblinkweblink" title="">weblink dead, 485 K.P.Kannan,  People's planning, Kerala's dilemma, April 29, 2015, Some argue that government standardisation in areas from commodity market, inspection and testing procurement bidding, Building codes, professional and vocational education, trade certification, safety, etc. are necessary.{{Citation needed|date=February 2013}} Emmanuelle Auriol and Michel Benaim write about the "comparative benefits" of decentralization versus government regulation in the setting of standards. They find that while there may be a need for public regulation if public safety is at stake, private creation of standards usually is better because "regulators or 'experts' might misrepresent consumers' tastes and needs." As long as companies are averse to incompatible standards, standards will be created that satisfy needs of a modern economy.JOURNAL, Emmanuelle, Auriol, Michel, Benaim, Standardization in Decentralized Economies, The American Economic Review, June 2000, 550–570, 90, 3, 10.1257/aer.90.3.550,weblink


Central governments themselves may own large tracts of land and control the forest, water, mineral, wildlife and other resources they contain. They may manage them through government operations or leasing them to private businesses; or they may neglect them to be exploited by individuals or groups who defy non-enforced laws against exploitation. It also may control most private land through land-use, zoning, environmental and other regulations.Terry L. Anderson, Vernon L. Smith, and Emily Simmons, How and Why to Privatize Federal Lands {{webarchive|url= |date=2013-08-17 }}, Cato Institute policy paper No. 363, November 9, 1999. Selling off or leasing lands can be profitable for governments willing to relinquish control, but such programs can face public scrutiny because of fear of a loss of heritage or of environmental damage. Devolution of control to regional or local governments has been found to be an effective way of dealing with these concerns.JOURNAL, Larson, A, Decentralisation and Forest Management in Latin America: Towards a Working Model, Public Administration and Development, 2003, 23, 3, 211–26, 10.1002/pad.271, BOOK, Ribot, J, Democratic Decentralisation of Natural Resources: Institutionalising Popular Participation, 2002, Routledge, Oxon, Such decentralization has happened in IndiaI. Scoones, Beyond Farmer First, London: Intermediate technology publications. and other third world nations.JOURNAL, Larson, A, Natural Resource Management and Decentralisation in Nicaragua: Are Local Governments up to the job?, World Development, 2002, 30, 1, 17–31, 10.1016/s0305-750x(01)00098-5,

Ideological decentralization

Libertarian socialist decentralization

File:Portrait of Pierre Joseph Proudhon 1865.jpg|thumb|right|Pierre Joseph Proudhon, anarchistanarchistLibertarian socialism is a group of political philosophies that promote a non-hierarchical, non-bureaucratic society without private property in the means of production. Libertarian socialists believe in converting present-day private productive property into common or public goods."The revolution abolishes private ownership of the means of production and distribution, and with it goes capitalistic business. Personal possession remains only in the things you use. Thus, your watch is your own, but the watch factory belongs to the people."weblinkAlexander Berkman. "What Is Communist Anarchism?" {{webarchive|url=|date=2012-05-23}} Libertarian socialism is opposed to coercive forms of social organization. It promotes free association in place of government and opposes the social relations of capitalism, such as wage labor.As Noam Chomsky put it, a consistent libertarian "must oppose private ownership of the means of production and the wage slavery, which is a component of this system, as incompatible with the principle that labor must be freely undertaken and under the control of the producer". Chomsky (2003) p. 26 {{webarchive|url= |date=2016-05-05 }} The term libertarian socialism is used by some socialists to differentiate their philosophy from state socialism,Paul Zarembka. Transitions in Latin America and in Poland and Syria. Emerald Group Publishing, 2007. p. 25Guerin, Daniel. Anarchism: A Matter of Words: "Some contemporary anarchists have tried to clear up the misunderstanding by adopting a more explicit term: they align themselves with libertarian socialism or communism." Faatz, Chris, Towards a Libertarian Socialism. and by some as a synonym for left anarchism.Ostergaard, Geoffrey. "Anarchism". A Dictionary of Marxist Thought. Blackwell Publishing, 1991. p. 21.Chomsky (2004) p. 739Ross, Dr. Jeffery Ian. Controlling State Crime {{webarchive|url= |date=2015-03-18 }}, Transaction Publishers (2000) p. 400 {{ISBN|0-7658-0695-9}}Accordingly, libertarian socialists believe that "the exercise of power in any institutionalized form – whether economic, political, religious, or sexual – brutalizes both the wielder of power and the one over whom it is exercised".BOOK, Ackelsberg, Martha A., Free Women of Spain: Anarchism and the Struggle for the Emancipation of Women, 41, 2005, AK Press, 978-1-902593-96-8, Libertarian socialists generally place their hopes in decentralized means of direct democracy such as libertarian municipalism, citizens' assemblies, or workers' councils.BOOK, Rocker, Rudolf, Anarcho-Syndicalism: Theory and Practice, 65, 2004, AK Press, 978-1-902593-92-0, Libertarian socialists are strongly critical of coercive institutions, which often leads them to reject the legitimacy of the state in favor of anarchism.Spiegel, Henry. The Growth of Economic Thought Duke University Press (1991) p. 446 Adherents propose achieving this through decentralization of political and economic power, usually involving the socialization of most large-scale private property and enterprise (while retaining respect for personal property). Libertarian socialism tends to deny the legitimacy of most forms of economically significant private property, viewing capitalist property relations as forms of domination that are antagonistic to individual freedom.Paul, Ellen Frankel et al. Problems of Market Liberalism Cambridge University Press (1998) p. 305However, libertarian socialism retains respect for personal property.Political philosophies commonly described as libertarian socialist include most varieties of anarchism (especially anarchist communism, anarchist collectivism, anarcho-syndicalism,BOOK, Sims, Franwa, The Anacostia Diaries As It Is, 160, 2006, Lulu Press, and mutualismA Mutualist FAQ: A.4. Are Mutualists Socialists? {{webarchive|url= |date=2009-06-09 }}. Retrieved on 2011-12-28.) as well as autonomism, communalism, participism, libertarian Marxist philosophies such as council communism and Luxemburgism,Murray Bookchin, Ghost of Anarcho-Syndicalism; Robert Graham, The General Idea of Proudhon's Revolution and some versions of "utopian socialism"Kent Bromley, in his preface to Peter Kropotkin's book The Conquest of Bread, considered early French utopian socialist Charles Fourier to be the founder of the libertarian branch of socialist thought, as opposed to the authoritarian socialist ideas of Babeuf and Buonarroti." Kropotkin, Peter. The Conquest of Bread, preface by Kent Bromley, New York and London, G. P. Putnam's Sons, 1906. and individualist anarchism."(Benjamin) Tucker referred to himself many times as a socialist and considered his philosophy to be "Anarchistic socialism." An Anarchist FAQ by Various AuthorsFrench individualist anarchist Émile Armand shows clearly opposition to capitalism and centralized economies when he said that the individualist anarchist "inwardly he remains refractory – fatally refractory – morally, intellectually, economically (The capitalist economy and the directed economy, the speculators and the fabricators of single are equally repugnant to him.)""Anarchist Individualism as a Life and Activity" by Emile Armand {{webarchive|url= |date=2012-07-28 }}Anarchist Peter Sabatini reports that In the United States "of early to mid-19th century, there appeared an array of communal and "utopian" counterculture groups (including the so-called free love movement). William Godwin's anarchism exerted an ideological influence on some of this, but more so the socialism of Robert Owen and Charles Fourier. After success of his British venture, Owen himself established a cooperative community within the United States at New Harmony, Indiana during 1825. One member of this commune was Josiah Warren (1798–1874), considered to be the first individualist anarchist"Peter Sabatini. "Libertarianism: Bogus Anarchy" {{webarchive|url= |date=2012-05-03 }} For Murray Bookchin "In the modern world, anarchism first appeared as a movement of the peasantry and yeomanry against declining feudal institutions. In Germany its foremost spokesman during the Peasant Wars was Thomas Muenzer; in England, Gerrard Winstanley, a leading participant in the Digger movement. The concepts held by Muenzer and Winstanley were superbly attuned to the needs of their time – a historical period when the majority of the population lived in the countryside and when the most militant revolutionary forces came from an agrarian world. It would be painfully academic to argue whether Muenzer and Winstanley could have achieved their ideals. What is of real importance is that they spoke to their time; their anarchist concepts followed naturally from the rural society that furnished the bands of the peasant armies in Germany and the New Model in England."Lewis Herber. (Murray Bookchin) "Ecology and Revolutionary Thought" {{webarchive|url= |date=2012-05-15 }}. (2009-04-27). Retrieved on 2011-12-28. The term "anarchist" first entered the English language in 1642, during the English Civil War, as a term of abuse, used by Royalists against their Roundhead opponents. By the time of the French Revolution some, such as the Enragés, began to use the term positively,Sheehan, Sean. Anarchism, London: Reaktion Books, 2004. p. 85. in opposition to Jacobin centralisation of power, seeing "revolutionary government" as oxymoronic.WEB,weblink Anarchism, BBC Radio 4, In Our Time (BBC Radio 4), In Our Time, 7 Dec 2006, April 30, 2012, live,weblink" title="">weblink March 28, 2012, By the turn of the 19th century, the English word "anarchism" had lost its initial negative connotation.For Proudhon, mutualism involved creating "industrial democracy," a system where workplaces would be "handed over to democratically organised workers' associations . . . We want these associations to be models for agriculture, industry and trade, the pioneering core of that vast federation of companies and societies woven into the common cloth of the democratic social Republic."Guerin, Daniel (ed.) No Gods, No Masters, AK Press, vol. 1, p. 62 He urged "workers to form themselves into democratic societies, with equal conditions for all members, on pain of a relapse into feudalism." This would result in "Capitalistic and proprietary exploitation, stopped everywhere, the wage system abolished, equal and just exchange guaranteed."The General Idea of the Revolution, Pluto Press, pp. 277, 281 Workers would no longer sell their labour to a capitalist but rather work for themselves in co-operatives. Anarcho-communism calls for a confederal form in relationships of mutual aid and free association between communes as an alternative to the centralism of the nation-state. Peter Kropotkin thus suggested that "Representative government has accomplished its historical mission; it has given a mortal blow to court-rule; and by its debates it has awakened public interest in public questions. But to see in it the government of the future socialist society is to commit a gross error. Each economic phase of life implies its own political phase; and it is impossible to touch the very basis of the present economic life-private property – without a corresponding change in the very basis of the political organization. Life already shows in which direction the change will be made. Not in increasing the powers of the State, but in resorting to free organization and free federation in all those branches which are now considered as attributes of the State."WEB,weblinkweblink" title="">weblink dead, Anarchist Communism: Its Basis and Principles, October 3, 2012, The Anarchist Library, When the First Spanish Republic was established in 1873 after the abdication of King Amadeo, the first president, Estanislao Figueras, named Francesc Pi i Margall Minister of the Interior. His acquaintance with Proudhon enabled Pi to warm relations between the Republicans and the socialists in Spain. Pi i Margall became the principal translator of Proudhon's works into SpanishGeorge Woodcock. Anarchism: a history of libertarian movements. p. 357 and later briefly became president of Spain in 1873 while being the leader of the Democratic Republican Federal Party. According to George Woodcock "These translations were to have a profound and lasting effect on the development of Spanish anarchism after 1870, but before that time Proudhonian ideas, as interpreted by Pi, already provided much of the inspiration for the federalist movement which sprang up in the early 1860's."George Woodcock. Anarchism: a history of libertarian movements. p. 357 According to the Encyclopædia Britannica "During the Spanish revolution of 1873, Pi y Margall attempted to establish a decentralized, or "cantonalist," political system on Proudhonian lines.""Anarchism" {{webarchive|url= |date=2014-04-24 }} at the Encyclopædia Britannica online.To date, the best-known examples of an anarchist communist society (i.e., established around the ideas as they exist today and achieving worldwide attention and knowledge in the historical canon), are the anarchist territories during the Spanish Revolution"This process of education and class organization, more than any single factor in Spain, produced the collectives. And to the degree that the CNT-FAI (for the two organizations became fatally coupled after July 1936) exercised the major influence in an area, the collectives proved to be generally more durable, communist and resistant to Stalinist counterrevolution than other republican-held areas of Spain." Murray Bookchin{{webarchive|url= |date=2012-03-18 }}. To Remember Spain: The Anarchist and Syndicalist Revolution of 1936] and the Free Territory during the Russian Revolution. Through the efforts and influence of the Spanish Anarchists during the Spanish Revolution within the Spanish Civil War, starting in 1936 anarchist communism existed in most of Aragon, parts of the Levante and Andalusia, as well as in the stronghold of Anarchist Catalonia before being crushed by the combined forces of the regime that won the war, Hitler, Mussolini, Spanish Communist Party repression (backed by the USSR) as well as economic and armaments blockades from the capitalist countries and the Second Spanish Republic itself.Murray Bookchin {{webarchive|url= |date=2012-03-18 }}. To Remember Spain: The Anarchist and Syndicalist Revolution of 1936] During the Russian Revolution, anarchists such as Nestor Makhno worked to create and defend – through the Revolutionary Insurrectionary Army of Ukraine – anarchist communism in the Free Territory of Ukraine from 1919 before being conquered by the Bolsheviks in 1921. Several libertarian socialists, notably Noam Chomsky among others, believe that anarchism shares much in common with certain variants of Marxism (see libertarian marxism) such as the council communism of Marxist Anton Pannekoek. In Chomsky's Notes on Anarchism,Noam Chomsky Notes on Anarchism {{webarchive|url= |date=2014-08-28 }} he suggests the possibility "that some form of council communism is the natural form of revolutionary socialism in an industrial society. It reflects the belief that democracy is severely limited when the industrial system is controlled by any form of autocratic elite, whether of owners, managers, and technocrats, a 'vanguard' party, or a State bureaucracy."

Free market decentralization

Free market ideas popular in the 19th century, such as those of Adam Smith returned to prominence in the 1970s and 1980s. Nobel Prize-winning economist Friedrich von Hayek emphasized that free markets themselves are decentralized systems where outcomes are produced without explicit agreement or coordination by individuals who use prices as their guide.Marvin Zelkowitz, Editor, Advances in Computers, Volume 82, Academic Press, 2011, p. 3 {{webarchive|url= |date=2016-05-28 }}, {{ISBN|9780123855138}} As Eleanor Doyle writes: "Economic decision-making in free markets is decentralized across all the individuals dispersed in each market and is synchronized or coordinated by the price system." The individual right to property is part of this decentralized system.Eleanor Doyle, The Economic System, John Wiley & Sons, 2005, p. 61 {{webarchive|url= |date=2016-06-23 }}, {{ISBN|9780470015179}} Analyzing the problems of central government control, Hayek wrote in The Road to Serfdom:, {{ISBN|9780226320533}}}}According to Bruce M. Owen, this does not mean that all firms themselves have to be equally decentralized. He writes: "markets allocate resources through arms-length transactions among decentralized actors. Much of the time, markets work very efficiently, but there is a variety of conditions under which firms do better. Hence, goods and services are produced and sold by firms with various degrees of horizontal and vertical integration." Additionally, he writes that the "economic incentive to expand horizontally or vertically is usually, but not always, compatible with the social interest in maximizing long-run consumer welfare." When it does not, he writes regulation may be necessary.Bruce M. Owen, Antecedents to Net Neutrality {{webarchive|url= |date=2013-06-17 }}, Cato Institute publication "Regulation", Fall, 2007, p. 16.It often is claimed that free markets and private property generate centralized monopolies and other ills; the counter is that government is the source of monopoly.
  • Tibor R. Machan, Private Rights & Public Illusions, Transaction Publishers, 1995, p. 99 {{webarchive|url= |date=2016-04-26 }}, {{ISBN|9781412831925}}
  • Tibor R. Machan, editor, The Libertarian Alternative, Nelson-Hall, 1974 included Yale Brozen's, "Is Government the source of monopoly? and other essays", Cato Institute, 1980; and Roy Childs' "Big Business and the Rise of American Statism", 1971, Reason. Historian Gabriel Kolko in his book The Triumph of Conservatism argued that in the first decade of the 20th century businesses were highly decentralized and competitive, with new businesses constantly entering existing industries. There was no trend towards concentration and monopolization. While there were a wave of mergers of companies trying to corner markets, they found there was too much competition to do so. This also was true in banking and finance, which saw decentralization as leading to instability as state and local banks competed with the big New York City firms. The largest firms turned to the power of the state and working with leaders like United States Presidents Theodore Roosevelt, William H. Taft and Woodrow Wilson passed as "progressive reforms" centralizing laws like The Federal Reserve Act of 1913 that gave control of the monetary system to the wealthiest bankers; the formation of monopoly "public utilities" that made competition with those monopolies illegal; federal inspection of meat packers biased against small companies; extending Interstate Commerce Commission to regulating telephone companies and keeping rates high to benefit AT&T; and using the Sherman Anti-trust Act against companies which might combine to threaten larger or monopoly companies.Gabriel Kolko, The Triumph of Conservatism: A Reinterpretation of American History, 1900–1916, Chapter Two: "Competition and Decentralization: The Failure to Rationalize Industry", Simon and Schuster, 2008, pp. 26–56, 141, 220, 243, 351 {{webarchive|url= |date=2016-05-11 }}, {{ISBN|9781439118726}}Roy Childs, "Big Business and the Rise of American Statism {{webarchive|url= |date=2013-01-30 }}", Reason, 1971. When government licensing, franchises, and other legal restrictions create monopoly and protect companies from open competition, deregulation is the solution.D. T. Armentano, Antitrust Policy: Reform or Repeal? {{webarchive|url= |date=2013-06-17 }}, Cato Institute Policy Analysis No. 21, January 18, 1983
Author and activist Jane Jacobs's influential 1961 book The Death and Life of American Cities criticized large-scale redevelopment projects which were part of government-planned decentralization of population and businesses to suburbs. She believed it destroyed cities' economies and impoverished remaining residents.John Montgomery, The New Wealth of Cities: City Dynamics and the Fifth Wave, Ashgate Publishing, Ltd., 2008, p. 2 {{webarchive|url= |date=2016-05-22 }}, {{ISBN|9780754674153}} Her 1980 book The Question of Separatism: Quebec and the Struggle over Sovereignty supported secession of Quebec from Canada.Jane Jacobs, The Question of Separatism: Quebec and the Struggle over Sovereignty, (1980 Random House and 2011 Baraka Books), {{ISBN|978-1-926824-06-2}} Her 1984 book Cities and the Wealth of Nations proposed a solution to the various ills plaguing cities whose economies were being ruined by centralized national governments: decentralization through the "multiplication of sovereignties", i.e., acceptance of the right of cities to secede from the larger nation states that were squelching their ability to produce wealth.Gopal Balakrishnan, Mapping the Nation, Verso, 1996, p. 277 {{webarchive|url= |date=2016-06-10 }}, {{ISBN|9781859840603}}Jane Jacobs, Cities and the Wealth of Nations: Principles of Economic Life, Vintage Books, 1984, {{ISBN|0-394-72911-0}}

Technological decentralization

File:Living Machine at Port of Portland-interior.jpg|left|thumb|alt=A view of the Port of Portland, Oregon, headquarters showing the Living Machine installation in the lobby|The Living Machine installation in the lobby of the Port of Portland headquarters, which was completed and ready for occupation May 2010. The decentralized wastewater reuse system contributed to the headquarter's certification as a LEED Platinum building by the U.S. Green Building CouncilU.S. Green Building CouncilTechnological decentralization can be defined as a shift from concentrated to distributed modes of production and consumption of goods and services.Eggimann, S. The optimal degree of centralisation for wastewater infrastructures. A model-based geospatial economic analysis Doctoral Thesis ETH Zurich., 30. November 2016. Generally, such shifts are accompanied by transformations in technology and different technologies are applied for either system. Technology includes tools, materials, skills, techniques and processes by which goals are accomplished in the public and private spheres. Concepts of decentralization of technology are used throughout all types of technology, including especially information technology and appropriate technology.Technologies often mentioned as best implemented in a decentralized manner, include: water purification, delivery and waste water disposal,Jeremy Magliaro, Amory Lovins, Valuing Decentralized Wastewater Technologies: A Catalog of Benefits, Costs, and Economic Analysis Techniques {{webarchive|url= |date=2013-03-05 }}, Rocky Mountain Institute, 2004.Lawrence D. Smith, Reform and Decentralization of Agricultural Services: A Policy Framework, United Nations Food and Agriculture Organization, 2001, p. 2010–211 {{webarchive|url= |date=2016-06-10 }}, {{ISBN|9789251046449}} agricultural technologyLawrence D. Smith, Reform and Decentralization of Agricultural Services: A Policy Framework, 2001. and energy technology.Maggie Koerth-Baker, What We Talk About When We Talk About the Decentralization of Energy {{webarchive|url= |date=2016-12-31 }}, The Atlantic, April 16, 2012.WEB,weblink How blockchain technology could electrify the energy industry,, en-US, 2019-10-07, Advancing technology may allow decentralized, privatized and free market solutions for what have been public services, such utilities producing and/or delivering power, water, mail, telecommunications and services like consumer product safety, money and banking, medical licensing and detection and metering technologies for highways, parking, and auto emissions.Fred E. Foldvary, Daniel Bruce Klein, Editors, The Half-Life of Policy Rationales: How New Technology Affects Old Policy Issues NYU Press, 2003, pp. 1, 184 {{webarchive|url= |date=2016-05-01 }}, {{ISBN|9780814747773}}{{clarify|reason=I can't parse this sentence at all.|date=November 2015}} However, in terms of technology, a clear distinction between fully centralized or decentralized technical solutions is often not possible and therefore finding an optimal degree of centralization difficult from an infrastructure planning perspective.JOURNAL, Eggimann S., Truffer, B., Maurer, M., To connect or not to connect? Modelling the optimal degree of centralisation for wastewater infrastructures, Water Research, 2015, 84, 218–32, 10.1016/j.watres.2015.07.004, 26247101,

Information technology

Information technology encompasses computers and computer networks, as well as information distribution technologies such as television and telephones. The whole computer industry of computer hardware, software, electronics, internet, telecommunications equipment, e-commerce and computer services are included.{{citation |last1=Chandler |first1=Daniel |last2=Munday |first2=Rod |contribution=Information technology |title=A Dictionary of Media and Communication |edition=first |publisher=Oxford University Press |url= |accessdate=1 August 2012}} {{subscription required}}Executives and managers face a constant tension between centralizing and decentralizing information technology for their organizations. They must find the right balance of centralizing which lowers costs and allows more control by upper management, and decentralizing which allows sub-units and users more control. This will depend on analysis of the specific situation. Decentralization is particularly applicable to business or management units which have a high level of independence, complicated products and customers, and technology less relevant to other units.John Baschab, Jon Piot, The Executive's Guide to Information Technology, John Wiley & Sons, 2007, p. 119 {{webarchive|url= |date=2016-05-01 }}, {{ISBN|9780470135914}}Information technology applied to government communications with citizens, often called e-Government, is supposed to support decentralization and democratization. Various forms have been instituted in most nations worldwide.G. David Garson, Modern Public Information Technology Systems: Issues and Challenges, IGI Global, 2007, p. 115–20 {{webarchive|url= |date=2016-05-19 }}, {{ISBN|9781599040530}}The internet is an example of an extremely decentralized network, having no owners at all (although some have argued that this is less the case in recent yearsWEB, Kopfstein, Janus, The Mission To Decentralize The Internet,weblink The New Yorker, Condé Nast, 13 December 2013, live,weblink" title="">weblink 13 December 2013, ). "No one is in charge of internet, and everyone is." As long as they follow a certain minimal number of rules, anyone can be a service provider or a user. Voluntary boards establish protocols, but cannot stop anyone from developing new ones.Thomas W. Malone, Robert Laubacher, Michael S. Scott Morton, Inventing Organizations 21st Century, MIT Press, 2003, 65–66 {{webarchive|url= |date=2016-04-28 }}, {{ISBN|9780262632737}} Other examples of open source or decentralized movements are Wikis which allow users to add, modify, or delete content via the internet.Chris DiBona, Mark Stone, Danese Cooper, Open Sources 2.0: The Continuing Evolution, O'Reilly Media, Inc., 2008, p. 316 {{webarchive|url= |date=2016-06-10 }}, {{ISBN|9780596553890}} Pseudopedia has been described as decentralized.Axel Bruns, Blogs, Wikipedia, Second Life, and Beyond: From Production to Produsage, Peter Lang, 2008, p. 80 {{webarchive|url= |date=2016-05-28 }}, {{ISBN|9780820488660}} Smartphones have greatly increased the role of decentralized social network services in daily lives worldwide.Joseph Nye, The politics of the information age {{webarchive|url= |date=2013-02-21 }}, Prague Post, February 13, 2010.Decentralization continues throughout the industry, for example as the decentralized architecture of wireless routers installed in homes and offices supplement and even replace phone companies relatively centralized long-range cell towers.Adi Kamdar and Peter Eckersley, Can the FCC Create Public "Super WiFi Networks"? {{webarchive|url= |date=2013-02-12 }}, Electronic Frontier Foundation, February 5, 2013.Inspired by system and cybernetics theorists like Norbert Wiener, Marshall McLuhan and Buckminster Fuller, in the 1960s Stewart Brand started the Whole Earth Catalog and later computer networking efforts to bring Silicon Valley computer technologists and entrepreneurs together with countercultural ideas. This resulted in ideas like personal computing, virtual communities and the vision of an "electronic frontier" which would be a more decentralized, egalitarian and free-market libertarian society. Related ideas coming out of Silicon Valley included the free software and creative commons movements which produced visions of a "networked information economy".Jennifer Holt, Alisa Perren, Media Industries: History, Theory, and Method, John Wiley & Sons, 2011, pp. 1995–97 {{webarchive|url= |date=2016-05-04 }}, {{ISBN|9781444360233}}Because human interactions in cyberspace transcend physical geography, there is a necessity for new theories in legal and other rule-making systems to deal with decentralized decision-making processes in such systems. For example, what rules should apply to conduct on the global digital network and who should set them? The laws of which nations govern issues of internet transactions (like seller disclosure requirements or definitions of "fraud"), copyright and trademark?David G. Post and David R. Johnson, 'Chaos Prevailing on Every Continent': Towards a New Theory of Decentralized Decision-Making in Complex Systems {{webarchive|url= |date=2011-08-26 }}, Chicago-Kent Law Review, Vol. 73, No. 4, p. 1055, 1998, full version at David G. Post's Temple University website {{webarchive|url= |date=2012-10-03 }}.

Centralization and redecentralization of the Internet

The New Yorker reports that although the Internet was originally decentralized, in recent years it has become less so: "a staggering percentage of communications flow through a small set of corporations – and thus, under the profound influence of those companies and other institutions [...] One solution, espoused by some programmers, is to make the Internet more like it used to be – less centralized and more distributed."Examples of projects that attempt to contribute to the redecentralization of the Internet include ArkOS, Diaspora, FreedomBox, Namecoin, SAFE Network, twtxt and ZeroNet as well as advocacy group, which provides support for projects that aim to make the Web less centralized.In an interview with BBC Radio 5 Live one of the co-founders of explained that:}}

Appropriate technology

"Appropriate technology", originally described as "intermediate technology" by economist E. F. Schumacher in Small is Beautiful, is generally recognized as encompassing technologies that are small-scale, decentralized, labor-intensive, energy-efficient, environmentally sound, and locally controlled.BOOK, Appropriate Technology: Tools, Choices, and Implications, 1999, Academic Press, New York, 978-0-12-335190-6, 3, 270, Hazeltine, B., Bull, C., It is most commonly discussed as an alternative to transfers of capital-intensive technology from industrialized nations to developing countries.BOOK, Economic Development, 2003, Addison Wesley, Boston, 978-0-273-65549-7, 252–54, Todaro, M., Smith, S., Even developed countries developed appropriate technologies, as did the United States in 1977 when it created the National Center for Appropriate Technology (NCAT), though funding later dropped off.National Center for Appropriate Technology {{webarchive|url= |date=2013-03-10 }} website. A related concept is "design for the other 90 percent" – low-cost solutions for the great majority of the world's low income people.WEB, Cooper–Hewitt Museum, Design for the other 90%,weblink live,weblink" title="">weblink 2013-03-02,

Blockchain technology

Blockchain based networks are designed to support decentralization by way of a cryptographic distributed triple-entry accounting ledger, typically with "layers" where each layer is defined by an interoperable open protocol on top of which network participants can transact and build products or services without requiring permission from central authorities.Bitcoin is the original implementation of a blockchain where proof-of-work is used as a means of establishing decentralized consensus (aka. Nakamoto consensus), thus enabling the uniqueness of its intrinsic digital asset and utility as a scarce cryptocurrency. Since a blockchain is otherwise an arbitrary data structure with no inherent decentralized properties, at present there are limited use cases, although there is active experimentation in many industries and with different methods of achieving consensus.Decentralized protocols, applications, and ledgers could be more difficult for governments to control, censor, or regulate as has been seen with BitTorrent.DECENTRALIZED BLOCKCHAIN TECHNOLOGY AND THE RISE OF LEX CRYPTOGRAPHIA, SSRN, accessed March 21, 2017.JOURNAL, 7 March 2017, Bitcoin: Order without Law in the Digital Age, 2929133, McGinnis, John,


Factors hindering decentralization include weak local administrative or technical capacity, which may result in inefficient or ineffective services; inadequate financial resources available to perform new local responsibilities, especially in the start-up phase when they are most needed; or inequitable distribution of resources. Decentralization can make national policy coordination too complex; it may allow local elites to capture functions; local cooperation may be undermined by any distrust between private and public sectors; decentralization may result in higher enforcement costs and conflict for resources if there is no higher level of authority.Chapter 2. Decentralization and environmental issues {{webarchive|url= |date=2013-01-02 }}, "Environment in decentralized development", United Nations Food and Agriculture Organization ("FAO"), accessed February 23, 2013; also see Environment in Decentralized Decision Making, An Overview {{webarchive|url= |date=2013-05-29 }}, Agricultural Policy Support Service, Policy Assistance Division, FAO, Rome, Italy, November 2005. Additionally, decentralization may not be as efficient for standardized, routine, network-based services, as opposed to those that need more complicated inputs. If there is a loss of economies of scale in procurement of labor or resources, the expense of decentralization can rise, even as central governments lose control over financial resources.Other challenges, and even dangers, include the possibility that corrupt local elites can capture regional or local power centers, while constituents lose representation; patronage politics will become rampant and civil servants feel compromised; further necessary decentralization can be stymied; incomplete information and hidden decision-making can occur up and down the hierarchies; centralized power centers can find reasons to frustrate decentralization and bring power back to themselves.{{Citation needed|date=February 2013}}It has been noted that while decentralization may increase "productive efficiency" it may undermine "allocative efficiency" by making redistribution of wealth more difficult. Decentralization will cause greater disparities between rich and poor regions, especially during times of crisis when the national government may not be able to help regions needing it.Summary of Remy Prud’homme, "The Dangers of Decentralization {{webarchive|url= |date=2012-06-16 }}", World Bank Research Observer, 10(2):201, 1995, linked from Decentralization {{webarchive|url= |date=2012-10-26 }}, article "Restructuring local government project" of Dr. Mildred Warner.

Averting the dangers of decentralization: eight classic conditions

The literature identifies eight essential preconditions that must be ensured while implementing decentralization in order to avert the so-called "dangers of decentralization". These are:WEB,weblinkweblink" title="">weblink dead, Sharma, Chanchal Kumar (2014, Nov.12). Governance, Governmentality and Governability: Constraints and Possibilities of Decentralization in South Asia. Keynote Address, International Conference on Local Representation of Power in South Asia, Organized by Department of Political Science, GC University, Lahore (Pakistan), Nov.12–14, February 11, 2015,
  1. Social Preparedness and Mechanisms to Prevent Elite Capture
  2. Strong Administrative and Technical Capacity at the Higher Levels
  3. Strong Political Commitment at the Higher Levels
  4. Sustained Initiatives for Capacity-Building at the Local Level
  5. Strong Legal Framework for Transparency and Accountability
  6. Transformation of Local Government Organizations into High Performing Organizations
  7. Appropriate Reasons to Decentralize: Intentions Matter
  8. Effective Judicial System, Citizens' Oversight and Anticorruption Bodies to prevent Decentralization of Corruption

See also



Further reading

External links

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