Two main classifications for decentralization are widely used. The first is based on the kind of authorities that are transferred classifying thereby tralization into three main types; political decentralization, administrative decen-tralization, and financial decentralization. The second classification is based on whether the transfer of authority was mainly functional or spatial. 4
Classification based on the types of authorities that are transferred
Rondinelli (1980), Edquist (2005), Abd El Wahab (2006) and Amin (2006) classify decentralization into three main types:
Political decentralization: is the transfer of decision-making authority to the local units. It usually necessitates a change in laws and creation of elected local bodies.5 Furthermore, moving decision making closer to the service-delivery
1 Love Edquist (2005), op. cit, p.8.
2 Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung (2002).
Dezentralisierung und lokale Selbstverwaltung: Dezentralisierung in der deutschen Entwicklungszusammenarbeit. Deutschland: Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung. p. 4.
3 Samir Abd El Wahab (2006). Local Government and the Modern Trends with Egypt as a Case Study. Cairo: Public Administration Research and Consultation Center (Original in Arabic), p. 15.
4 This study however, will depend on the first classification.
5 Khaled Zakareya Amin (January 2006). “Financial Decentralization as a Way for Develop-ment in Egypt”. In: Al Nahdah. Vol. 7, No. 1. pp. 31-65, p. 32. (Original in Arabic).
units paves the way to promote civil society, local participation and pluralistic democracy.1
Administrative decentralization: is the transfer of administrative authorities and responsibilities to the lower local levels of government. The driving idea behind it is that lower local levels of government are more likely to have the needed information about the demands of the community, and by moving administrative authorities closer to the citizens, transparency and responsiveness can be achieved.2
Administrative decentralization is further classified into three main forms:
- De-concentration: when administrative authorities are transferred from the central government to the local levels of government in geographical ar-eas that are closer to the citizens. This is considered as the lowest or weakest but the widely adopted form of decentralization since it is still the central government that is responsible for everything.
- Delegation: when some of the administrative authorities are transferred to semi- autonomous organizations that are most likely to have business-like structures. However, sovereign authority remains with the central gov-ernment.
- Devolution: this is the most developed form of administrative decentraliza-tion. Here authority and responsibility are transferred from central gov-ernment to lower levels of govgov-ernment that are independent or separate from the central government. Usually, these local bodies hold their status by law, which allows them to raise their own funds to be able to perform their authorities and responsibilities effectively. For devolution to be ef-fective, Rondinelli (1980) emphasizes that the local governments should have the following characteristics: be given autonomy and be perceived as separate entities from the central government, have clear and legally rec-ognized geographical boundaries, have the ability to raise sufficient funds to perform their functions, are perceived by the citizens as providing ser-vices and as governmental units over which the citizens can exert some influence, and finally, have reciprocal relationships with the central gov-ernment. In fact, devolution does not mean the disappearance of the
1 Love Edquist (2005), op. cit. p. 9.
2 Taryn Rounds Parry (1997). “Achieving Balance in Decentralization: A Case Study of Edu-cation Decentralization in Chile”. In: World Development. Vol. 25, No. 2, pp. 211-225, p. 212.
tral government; rather the latter will keep supervisory powers.1 However, devolution was conceived by many developing countries as a main threat to the central government since it increases the powers of the local bod-ies.2 This is why it is not widely adopted.
Financial decentralization: involves the devolution of financial power and au-thority from the center to the local units.3 It entails both expenditure decentrali-zation and revenue decentralidecentrali-zation. Expenditure decentralidecentrali-zation is when local governments have expenditure discretion. Revenue decentralization is when lo-cal governments have the right to collect revenues through taxes or other reve-nue instruments.4 Many believe that there can be no real transfer of authority and responsibility (of power) without financial decentralization. This is why lo-cal administrative bodies need to control revenues in order to be able to perform their responsibilities and functions effectively and independently. Otherwise, the central government will keep providing financial transfers, and the local gov-ernment will be dependent on them. In fact, this is a problem that is facing many developing countries.5
Classification based on functional or spatial transfer of authority
Rondinelli (1980) introduces also a second classification, which classifies decentralization into functional and area or spatial decentralization.
Functional decentralization: is the transfer of certain tasks or activities to spe-cialized organizations that work either nationally or across local jurisdictions.
Area or spatial decentralization: is the transfer of some of the tasks or activities to organizations within well-defined sub-national spatial or political boundaries.6
Generally, no country in the world adopts a single type of tion; rather, adopts a mixture or a combination of different types of decentraliza-tion that can be perceived on a continuum,7 depending on the advantages that it seeks to achieve.
1 Dennis A. Rondinelli (1980), op. cit, p. 138.
2 Love Edquist (2005), op. cit, p. 10.
3 Sun Xiaoli (2007). “The Effects of Fiscal Decentralization on Compulsory Education in China: For Better or Worse”. In: JOAAG, Vol. 2. No. 1, pp. 40-53, p. 41.
4 Taryn Rounds Parry (1997), op. cit, p. 212.
5 Love Edquist (2005), op. cit, pp. 11-12.
6 Dennis A. Rondinelli (1980), op. cit, p. 137.
7 Robert K. Yin (1979). “Decentralization of Government Agencies: What Does it Accom-plish?”. In: American Behavioral Scientist, Vol. 22, No. 5, pp. 525-536, p. 527.
2 Reasons for adopting decentralization and prerequisites for its success Decentralization may achieve various advantages if it is successfully ap-plied.