Cities drifting apart: Heterogeneous outcomes of decentralizing public education

Zelda Brutti

doi:10.2478/izajole-2020-0003

Abstract

Abstract Looking at the decentralized provision of public education in a middle-income country, this paper estimates the impact of local autonomy on service quality, finding large heterogeneity in the effect across different levels of local development. In the year 2002, Colombian municipalities were entrusted with autonomous management of their local public education based solely on a population threshold. I estimate the impact that autonomy has had on education performance across the territory, using a municipality and time fixed-effects model. I find a quality gap arising between highly developed and low-developed autonomous municipalities, in a trend that reinforces over time: the reform has induced regional inequality in education quality. I am able to support the hypothesis that autonomous and nonautonomous municipalities were on similar performance trends before decentralization was implemented, even when looking within different local development ranges. Based on the analysis of detailed municipal balance sheet data and administration indicators, I argue that local administration capacity represents the most likely explanation of why the autonomy-related discrepancies have been arising.

Highlights

Decentralization of public service provision has been at the top of policy agendas in numerous countries over the last decades, involving services such as education, health, public transport and the supply of energy, water and sewerage systems
Cities distant from the treatment cutoff are used for estimation of the regression discontinuity (RD) model28, which relies on the assumption that the population polynomial f (Pi) is able to ‘control’ for those municipal characteristics that vary with size and may confound the effect of autonomy on test scores
Columns (6) in Table 3 show the estimation of model (2), where certification status is linearly interacted with the development percentile to which each municipality belongs, as an alternative way to capture heterogeneity in the effect

Summary

Introduction

Decentralization of public service provision has been at the top of policy agendas in numerous countries over the last decades, involving services such as education, health, public transport and the supply of energy, water and sewerage systems. In developing and middle-income countries, responsibilities are often handled from a central or regional level down to municipalities. In developing and middle-income countries, responsibilities are often handled from a central or regional level down to municipalities1 Such reform are expected to yield welfare benefits through better local preference matching, higher governor accountability and increases in the efficiency of service delivery. Welfare losses may instead derive from inadequate management skills of local authorities, increases in administrative and coordination costs, corruption among local bureaucrats or local elites resource capture. Welfare losses may instead derive from inadequate management skills of local authorities, increases in administrative and coordination costs, corruption among local bureaucrats or local elites resource capture3 These positive and negative repercussions may materialize in different proportions across different regions in the reforming country, giving rise or exacerbating regional inequalities. In this paper I show that entrusting Colombian municipalities with managerial autonomy over local public education has yielded heterogeneous results on local educational outcomes, depending on the level of municipal development at the time of the responsibility takeover

Results

Discussion

Conclusion