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| D.
Promoting economic growth: In some countries, technocrats assume
that decentralization can help to accelerate economic growth. But the empirical
evidence strongly suggests that its impact on growth is largely neutral
- except in certain large conurbations where (for example) the development
of industrial infrastructure may help. E. Mobilizing local resources financial capital: It is unrealistic to expect democratic decentralization to assist very much in mobilizing local resources - if by this we mean financial capital. (It can assist in mobilizing human resources - see section 7. F just below.) The reasons are complex, but the crucial problem is the understandable reluctance of elected representatives (especially but not only in newly created bodies) to levy new taxes. That would make the representatives unpopular and could undermine the legitimacy of the new bodies. Decentralizers who expect devolved tasks to be funded by new taxes put decentralized systems at risk by under-funding them. F. Making development more sustainable: Given the difficulties which attend the mobilization of local financial capital, democratic decentralization tends to do little to enhance the sustainability of development in economic terms - although the erosion of popular reluctance to pay taxes helps somewhat. But it can assist in other ways. Since decentralized authorities often give citizens local development projects that they prefer, citizens tend to maintain them with care. And since decentralization helps to increase the uptake on (for example) health services, citizens using them increasingly recognise their benefits -- so that the increased uptake is sustained. |
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