Interacting capacities : National bureaucracies ’ contribution to subnational performance

Boundaries between levels of government are usually blurred, and bureaucracies at different levels often interact on the field to achieve a policy goal. However, scarce literature has dealt with the contribution of national/federal bureaucracies to achieving subnational policy goals. This research explores the relationship between a national deconcentrated bureaucratic capacity and subnational decentralized government capacity in Colombia’s secondary education provision. While Colombian schooling is decentralized at the subnational level, the national government indirectly contributes to schooling by administering child and youth protection services through a national agency (ICBF), which is highly deconcentrated over the country. Therefore, enrollment in secondary education is a salient issue for both subnational and ICBF bureaucracies. ICBF’s personnel and spending figures capture national government capacity at the subnational level while numbers of teachers and high schools assess subnational government capacity. Using panel data for the 32 Colombian departamentos (provinces) over 2004-2013, results reveal both deployed national bureaucracy and subnational capacity boost high school enrollment; meanwhile, ICBF seems to partially substitute subnational capacity with the weakest subnational governments gaining the most from ICBF presence in the territory. [PRELIMINARY DO NOT CITE] To be presented at the Ostrom Workshop Research Series, March 27 2019 The provision of social services in the developing world often configures a governance system with several levels of shared policy responsibility. In a context of substantial yet incomplete decentralization, subnational and local governments are in charge of providing certain services while the national government works on closely related areas thus affecting government performance at the local level. National governments often intervene via bureaucratic structures with direct operational work across the territory. Yet, the extent to which the national state exerts an influence on local communities is far from homogeneous. The literature in political science has explored the phenomenon of uneven reach of state capacity but more research is needed in order to disentangle the process of converting inputs into policy outcomes under these conditions. One might argue that the nature of the services provided by the national state in a territory vis-à-vis a service provided by the local government, might affect the way in which national bureaucratic capacity affects service provision. Is the national state complementing the work of subnational governments? Or is it offering a substitute to locally provided services? The uneven capacity of the Colombian state across its own territory presents the opportunity to explore the relationship between national bureaucracies and those of the local governments to deliver specific socially desirable outputs. This paper explores the provision of education by Colombian subnational and local governments, and the role that ICBF, the Colombian national agency for the protection of children and the youth, plays on the delivery of this service. ICBF offices and operational centers spread over the country and provide a wide range of services related to the physical, emotional and social wellbeing of children and youth. In doing so, they influence the provision of education to the population, which is a responsibility of locally managed schools. An analysis of the 32 Colombian departamentos (provinces) over the 2004-2013 period shows national government capacity, via ICBF, influences the provision of education; moreover, ICBF capacity yields a greater impact in departamentos with low subnational government capacity. This interactive effect between local and national capacity on service provision might depend on the nature of the relationship between both bureaucracies. In the case of ICBF, its services related to ensuring education provision seem to be partial substitutes of some services already offered by schools. On the contrary, complementary capacities could result in reinforcing effects for service provision, but that case is out of the scope of this paper. This paper aims to contribute an unexplored perspective to the understanding of the quality of government. Research designs that use local governments as unit of analysis to understand within-country variation of government performance are frequently used in the literature of public management (see for instance Avellaneda, 2008, 2009, and Walker & Andrews, 2013 for a review of the literature). Yet, the territorial unevenness of national state capacity and its influence on subnational government performance has not been explored so far. Meanwhile, in the vast literature of fiscal federalism and decentralization the national government is often perceived as the source of resource transfers or in the role of monitoring and overseeing; here, the national government is introduced as a bureaucratic actor on the field. In the following sections, the theoretical underpinnings of the relationship between capacity and performance for subnational governments are explored and the phenomenon of unevenness state capacity in the developing world is described. Then, the next section discusses and formulates hypotheses about the interaction between the capacity of the national bureaucracy and local capacity for service provision in the context of decentralization and deconcentration. The case of education delivery in Colombia is then described, as well as the role indirectly played by ICBF in this process. Data and methods are presented, as well as the results of the empirical analysis. A discussion of the main findings follows, and a final section offers some conclusions, avenues for further research and discusses the limitations of the paper. Subnational government capacity and performance There is no consensus on the meaning of capacity in public management research. Christensen and Gazley (2008) offer a perspective of capacity as a multi-dimensional, multilevel, and highly contextual concept, based on a bibliometric analysis of the literature in public, non-profit and business management. The authors consider four broad dimensions (human resources, financial resources, infrastructure and external environment) to encompass the complexity of the term. Three of their four dimensions relate to internal capabilities. In their comprehensive study of organizational capacity in the US states, Ingraham, Joyce and Donahue (2003) had also mostly focused on internal capabilities such as human resources, financial resources and information systems. While organizational capacity will always need to be attached to a specific context (capacity to do what? ), understanding it as a set of internal capabilities allows to establish some conceptual boundaries and facilitates the analysis of its relationship with performance. Capacity can be defined as a set of internal capabilities or resource stocks to be used for organizational performance, among which human and financial resources are central dimensions of the concept. Meanwhile, performance itself is also a multi-dimensional and context-dependent concept (Walker, Boyne & Brewer, 2010). Yet, most approaches to the concept of performance in public management research follow under either the input-output-outcome model (IOO), the economy-efficiency-effectiveness (3E) model or something in between (Walker, Boyne & Brewer, 2010). Both approaches have in common an interest in performance as the result of an organizational process of transforming inputs into outputs and outcomes, and the salient perception of organizational performance as effectiveness (i.e. the ability to achieve relevant outputs). For the purpose of this paper, organizational performance is mainly understood as effectiveness or quantity of outputs in service provision (Boyne, 2003) which is also fitting to the context of the empirical case, as it will be explored later. Several models of organizational performance highlight the role of capacity as a main driver of performance in public organizations even when using different terms that also point to a set of organizational internal capabilities. For instance, O’Toole and Meier (1999) suggest that hierarchy, i.e. “formal authority to compel” (p. 508), and management substitute each other to provide the organization with the stability that is necessary to make use of their internal capabilities in order to perform. Moreover, information technology and human resource development are among the several factors, identified by Rainey and Steinbauer (1999), that affect organizational effectiveness. Boyne (2003) also includes elements of organizational capacity (e.g. resources and size) among the determinants for improvement in public service delivery. Thus, public management scholars have consistently incorporated capacity elements in their models of performance, with the logic that internal capabilities constitute the inputs or production factors that public organizations use in order to deliver outputs. More attention at the theoretical and empirical level has been paid to explore the effect of other drivers of performance such as management, structure, regulation, markets and environmental context (Boyne, 2003). Yet, some literature has focused on understanding the interaction between capacity and some of these other factors whose association with performance is less clear. For instance, Carley, Nicholson‐Crotty, and Fisher (2015) found a positive interactive effect of capacity and federal guidance on the use of funds of the American Recovery and Reinvestment Act (ARRA) of 2009 by USA states. They assessed capacity as human capital, more specifically as the acumen of financial and policy-specific experience in the state government. Meanwhile, Andrews et al (2013) explored the moderating effect of administrative capacity on the relationship between environ