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The Impact of Recentralization on Public Services: A Difference-in-Differences Analysis of the Abolition of Elected Councils in Vietnam

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  • MALESKY, EDMUND J.
  • NGUYEN, CUONG VIET
  • TRAN, ANH

Abstract

Comparative political economy offers a wealth of hypotheses connecting decentralization to improved public service delivery. In recent years, influential formal and experimental work has begun to question the underlying theory and empirical analyses of previous findings. At the same time, many countries have grown dissatisfied with the results of their decentralization efforts and have begun to reverse them. Vietnam is particularly intriguing because of the unique way in which it designed its recentralization, piloting a removal of elected people's councils in 99 districts across the country and stratifying the selection by region, type of province, and urban versus rural setting. We take advantage of the opportunity provided by this quasi experiment to test the core hypotheses regarding the decision to shift administrative and fiscal authority to local governments. We find that recentralization significantly improved public service delivery in areas important to central policy-makers, especially in transportation, healthcare, and communications.

Suggested Citation

  • Malesky, Edmund J. & Nguyen, Cuong Viet & Tran, Anh, 2014. "The Impact of Recentralization on Public Services: A Difference-in-Differences Analysis of the Abolition of Elected Councils in Vietnam," American Political Science Review, Cambridge University Press, vol. 108(1), pages 144-168, February.
    • Handle: RePEc:cup:apsrev:v:108:y:2014:i:01:p:144-168_00
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    Cited by:

    1. Sant’Anna, Pedro H.C. & Zhao, Jun, 2020. "Doubly robust difference-in-differences estimators," Journal of Econometrics, Elsevier, vol. 219(1), pages 101-122.
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    3. John Rand, 2017. "Are politically connected firms less constrained in credit markets?," WIDER Working Paper Series 200, World Institute for Development Economic Research (UNU-WIDER).
    4. Olivier Marie & Thomas Post & Zihan Ye & Xiaopeng Zou, 2024. "From Two Heads to One: The Short-Run Effects of the Recentralization of Political Power in Rural China," Tinbergen Institute Discussion Papers 24-040/V, Tinbergen Institute.
    5. Raúl A Ponce-Rodríguez & Charles R Hankla & Jorge Martinez-Vazquez & Eunice Heredia-Ortiz, 2018. "Rethinking the Political Economy of Decentralization: How Elections and Parties Shape the Provision of Local Public Goods," Publius: The Journal of Federalism, CSF Associates Inc., vol. 48(4), pages 523-558.
    6. Manh‐Tien Bui & Thai‐Ha Le & Donghyun Park, 2023. "Impacts of fiscal decentralization on local development in Vietnam: A disaggregated analysis," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 31(1), pages 3-31, January.
    7. Di Dong & Rong Ran & Bingsheng Liu & Jinfeng Zhang & Chengcheng Song & Jing Wang, 2024. "Recentralization and the long‐lasting effect of campaign‐style enforcement: From the perspective of authority allocation," Review of Policy Research, Policy Studies Organization, vol. 41(1), pages 239-275, January.
    8. Yu Qi & Jinliang Yu, 2023. "Decentralization and local pollution activities: New quasi evidence from China," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 31(1), pages 115-159, January.
    9. Maier, Carl, 2016. "Local public goods as perfect substitutes -- centralization vs. decentralization," VfS Annual Conference 2016 (Augsburg): Demographic Change 145928, Verein für Socialpolitik / German Economic Association.
    10. Carlitz, Ruth D. & Povitkina, Marina, 2021. "Local interest group activity and environmental degradation in authoritarian regimes," World Development, Elsevier, vol. 142(C).
    11. Bargain, Olivier B. & Vincent, Rose Camille & Caldeira, Emilie, 2024. "Shine a (Night)Light: Decentralization and Economic Development in Burkina Faso," IZA Discussion Papers 17459, Institute of Labor Economics (IZA).
    12. Federico Revelli, 2016. "Tax limits and local elections," Public Choice, Springer, vol. 166(1), pages 53-68, January.
    13. Chaudhary, Latika & Iyer, Lakshmi, 2024. "The Importance of Being Local? Administrative Decentralization and Human Development," IZA Discussion Papers 17053, Institute of Labor Economics (IZA).
    14. Quang Nguyen, 2017. "Do Natural Disasters Open a Window of Opportunity for Corruption?," Journal of Development Studies, Taylor & Francis Journals, vol. 53(1), pages 156-172, January.
    15. Foa, Roberto Stefan, 2022. "Decentralization, historical state capacity and public goods provision in Post-Soviet Russia," World Development, Elsevier, vol. 152(C).
    16. Hiep Ngoc Luu & Tram Anh Nguyen & Ngoc Minh Nguyen & Dam Duc Le & Khoi Trong Dao, 2024. "The impact of recentralization reform on corruption: evidence from a quasi‐natural experiment," Kyklos, Wiley Blackwell, vol. 77(1), pages 118-148, February.
    17. Kong, Dongmin & Liu, Chenhao, 2024. "Centralization and regulatory enforcement: Evidence from personnel authority reform in China," Journal of Public Economics, Elsevier, vol. 229(C).
    18. Cai, Meina & Sun, Xin, 2018. "Institutional bindingness, power structure, and land expropriation in China," World Development, Elsevier, vol. 109(C), pages 172-186.
    19. John Rand, 2017. "Are politically connected firms less constrained in credit markets?," WIDER Working Paper Series wp-2017-200, World Institute for Development Economic Research (UNU-WIDER).
    20. Zeren Li & Zeyuan Wang, 2023. "Judicial recentralization as political control: Evidence from the judicial leader rotation in China," Social Science Quarterly, Southwestern Social Science Association, vol. 104(4), pages 669-683, July.
    21. Trinh, Trong-Anh & Feeny, Simon & Posso, Alberto, 2022. "Political connections and post-disaster assistance in rural Vietnam," European Journal of Political Economy, Elsevier, vol. 72(C).
    22. Zarychta, Alan, 2020. "Making social services work better for the poor: Evidence from a natural experiment with health sector decentralization in Honduras," World Development, Elsevier, vol. 133(C).
    23. Chunfei Yang & Yongyou Li & Yu Qi & Yanzhe Xu, 2024. "Decentralization, Supervision, and Chinese Local Government Debt," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 32(4), pages 229-262, July.
    24. Kosec, Katrina & Song, Jie & Zhao, Hongdi, 2021. "Bringing Power to the People or the Well-Connected? Evidence from Ethiopia on the Gendered Effects of Decentralizing Service Delivery," 2021 Conference, August 17-31, 2021, Virtual 315258, International Association of Agricultural Economists.
    25. Jose M Alonso & Rhys Andrews, 2019. "Fiscal decentralisation and local government efficiency: Does relative deprivation matter?," Environment and Planning C, , vol. 37(2), pages 360-381, March.

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