What role do local governments play in improving urban services?

IDG Research, November 2014 - The degree of success with which a country harnesses the power of urbanization serves as an important bellwether for inclusive and sustainable development. Urban areas form the engines of economic growth in countries around the world,  and provide spaces for social transformation and political inclusion. Millions of individuals recognize this every year by moving from the countryside to cities and towns. Urbanization continues unabatedly, especially in the developing regions of the world. Africa’s urban population is expected to increase from 414 million to over 1.2 billion by 2050, while the urban population of Asia is projected to climb from 1.9 billion to 3.3 billion people.

It is clear that the world’s most dynamic and prosperous cities offer high quality urban services. These services improve the ability of cities to attract and retain both talent and capital investments necessary to sustain high productivity levels. It is often assumed that the presence of a dynamic mayor is a key ingredient to effective urban services and the wider success of an urban area. In reality, little is known about the exact impact of local governance on urban service delivery outcomes. A growing body of evidence suggests that poor vertical governance arrangements in many developing economies significantly constrain urban local governments in managing and delivering urban local services.

Urban service delivery performance

In an attempt to identify the role that urban local governments play in achieving effective urban services, the Urban Institute—with a research grant from the International Growth Center—has launched a multi-country study to explore the extent to which urban service delivery outcomes are driven or constrained by the different institutional dimensions of the local government system. As part of the study, data will be gathered for 42 cities in 14 different countries across Africa and Asia. In each of these cities, the study will look at three urban services: solid waste management, water supply, and (sewered and non-sewered) sanitation.

For each of these three urban services, our main interest is in exploring the extent to which urban local governments and their political leaders actually have the authority, discretion, capacity, incentives, and accountability mechanisms in place to improve urban service delivery performance. In doing so, the study will consider five institutional aspects of the vertical governance system, including:

  1. the effectiveness with which functional assignments are made;
  2. the dynamism of the local political leadership;
  3. the degree of local control over administrative mechanisms (such as local human resource management and procurement);
  4. the degree of local fiscal autonomy; and
  5. the strength of local participation and accountability mechanisms.

Our analysis should reveal whether any or all of these institutional dimensions are associated with better service delivery outcomes. 

Specific Research Objectives 

The current study on urban service delivery and urban local governance has three specific objectives.

First, we want to generate basic comparative information about urban service delivery performance across cities in different countries, and about the local governance institutions that provide the intergovernmental context for urban local governments to succeed. Based on indicators for the five institutional dimensions of local governance (noted above), what characteristics and variations do we observe in the institutions of urban service delivery in Africa and Asia?

Second, we will explore whether there are specific dimensions of urban local governance that are correlated with better service delivery outcomes across three urban services. For instance, do local governments that have greater political opportunities to achieve better service delivery outcomes? If so, is this the case for all three urban services being analyzed, or only for a subset of services?

Our third research objective is to use multivariate quantitative analysis to empirically relate basic urban service delivery outcome measures to the different factors that are hypothesized to drive urban service delivery performance. Do any of the five institutional dimensions of urban governance and service delivery have an impact on service delivery outcomes? When all else is held equal, do differences in service delivery expenditures have an impact on outcomes? 

Building on research on urban service delivery and governance institutions in South Asia and Africa, the Urban Institute research team expects to complete the current study by October 2015.