Decentralization and good governance: The case of Indonesia

Green, Keith (2005): Decentralization and good governance: The case of Indonesia.

Abstract

Indonesia began a process of rapid government decentralization in 1999 from a formerly strong centralized government structure. I review the history of decentralization in Indonesia and assess how Indonesia has fared in pursuing a decentralization policy since 1999. I illustrate how Indonesia meets several criteria of successful decentralization and how it is fails the criteria in principle in other areas. Finally, I indicate the likely future challenges faced by Indonesia as it implements decentralization and provide some recommendations to improve the ongoing decentralization process.

• Item Type: MPRA Paper
• Language: English
• Keywords: government; decentralization; Indonesia
• Subjects: H - Public Economics > H1 - Structure and Scope of Government > H11 - Structure, Scope, and Performance of Government

References

Ahmad, Ehtisham; Mansoor, Ali. 2002. “Indonesia: Managing Decentralization.” IMF Working Paper 136, Fiscal Affairs Department and Independent Evaluation Office, Washington, DC.

Booth, Anne. 2003. “Decentralisation and Poverty Alleviation in Indonesia Environment and Planning.” C: Government and Policy 21(2):181-202.

Brillantes Jr., Alex B; Cuachon, Nora G. 2002. “Decentralization and Power Shift An Imperative for Good Governance: A Sourcebook on Decentralization Experiences in Asia.” Volume I. CLRG Working Papers Series 2002/02.

Crook, Richard; Manor, James. 1998. “Democracy and decentralisation in South Asia and West Africa : participation, accountability, and performance.” Cambridge University Press, Cambridge, United Kingdom.

Dabla-Norris Era; Wade, Paul. 2002. “The Challenge of Fiscal Decentralization in Transition Countries.” IMF Working Paper 103, IMF Institute, Washington, DC.

De Mello, Luiz; Barenstein, Matias. 2001. “Fiscal Decentralization and Governance: A Cross-Country Analysis.” IMF Working Paper 71, Fiscal Affairs Department, Washington, DC.

Fane, George. 2003. “Change and Continuity in Indonesia's New Fiscal Decentralisation Arrangements.” Bulletin of Indonesian Economic Studies 39(2):159-76.

Hadiz, Vedi R. 2004. “Decentralization and Democracy in Indonesia: A Critique of Neo-institutionalist Perspectives.” Development and Change (35)4:697-718.

Lewis, Blane D. 2003a. “Tax and Charge creation by regional governments under fiscal decentralization: Estimates and explanations.” Bulletin of Indonesian Economic Studies 39(2):177-92.

Lewis, Blane D. 2003b. “Property tax in Indonesia: measuring and explaining administrative (under-) performance.” Public Administration and Development 23(3):227-239.

McCarthy, John F. 2004. “Changing to Gray: Decentralization and the Emergence of Volatile Socio-legal Configurations in Central Kalimantan, Indonesia.” World Development 32(7):1199-1223.

Ryder, Mark. 2002. “The estimated revenue yield from a piggyback personal income tax.” Midterm Report to the Directorate of Regional Revenue, Ministry of Finance, Republic of Indonesia. August 12, Mimeo.

Shah, Anwar. 1998. “Balance, Accountability and Responsiveness: Lessons about Decentralization.” Policy Research Working Paper 2021, World Bank, Operations Evaluation Department, Country and Regional Evaluation Division, Washington, DC.

Shah, Anwar; Thompson, Theresa. 2004. “Implementing Decentralized Local Governance: A Treacherous Road with Potholes, Detours and Road Closings.” World Bank Policy Research Working Paper 3353, Washington, DC.

Silver, Christopher ; Azis, Iwan J. ; Schroeder, Larry. 2001. “Intergovernmental Transfers and Decentralisation in Indonesia.” Bulletin of Indonesian Economic Studies v37(3):345-62.

Ter-Minassian, Teresa. 1997. “Decentralization and Macroeconomic Management.” IMF Working Paper 155, Western Hemisphere Department, Washington, DC.

World Bank. 2003. “Decentralizing Indonesia: A Regional Public Expenditure Review Overview Report.” East Asia Poverty Reduction and Economic Management Unit, World Bank, Washington, DC.

World Bank. 2000. Poverty Reduction and Economic Management Note 43. “Indonesia’s decentralization after crisis.” World Bank, Washington, DC.