Designing Subnational Institutions

Abstract

This article conceptualizes decentralization as a change in the institutional rules that divide political authority and governing capacity between levels of government. By emphasizing the institutional dimension, the author argues that different approaches to the study of institutions, namely, rational and historical institutionalism, can generate analytical leverage on the contemporary trend of decentralization. In the Chilean case, rationalist perspectives illuminate the country’s continued status as one of Latin America’s most centralized polities. Comparatively weak subnational institutions directly reflect the strategic design considerations of national politicians. However, concepts central to historical institutionalism, including critical junctures and unanticipated consequences, explain how and why decentralization gained steam in the postauthoritarian period. Specifically, Chile’s shift to more decentralized institutions is the legacy of Pinochet-era reforms of subnational government, sequencing patterns that devolved governing capacity before political authority, and the emergence of new organizational actors who have struggled to decentralize Chile against the opposition of powerful national politicians.