Radical Decentralization: Does Community-Driven Development Work?

Posted: 7 Sep 2018

See all articles by Katherine Casey

Katherine Casey

Stanford Graduate School of Business

Date Written: August 2018


Classic arguments for decentralization, augmented by ideas about how participation empowers the poor, motivate the widely used approach in foreign aid called community-driven development (CDD). CDD devolves control over the selection, implementation, and financial management of public goods to communities. Until recently, policy enthusiasm has outstripped the evidence. I synthesize findings from randomized controlled trials and find that CDD effectively delivers public goods and modest economic returns at low cost in difficult environments. There is little evidence, however, that CDD transforms local decision making or empowers the poor in any enduring way. Part of this failure may be because some constraints believed to be important—like insufficient social capital—appear not to bind. Others, like exclusive local institutions, are a problem, although not one that CDD remedies. These results present a conundrum: How much participation is enough to safeguard the gains of such extreme decentralization while minimizing the opportunity costs imposed on poor people's time?

Suggested Citation

Casey, Katherine, Radical Decentralization: Does Community-Driven Development Work? (August 2018). Annual Review of Economics, Vol. 10, pp. 139-163, 2018. Available at SSRN: https://ssrn.com/abstract=3245103 or http://dx.doi.org/10.1146/annurev-economics-080217-053339

Katherine Casey (Contact Author)

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

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