Decentralization and Democratic Instability: The Case of Costa Rica

• DOI: http://doi.org/10.1111/j.1540-6210.2004.00348.x
• Author: Jeffrey J. Ryan
• Published date: 01 February 2004
• Date: 01 February 2004

Decentralization and Democratic Instability: The Case of Costa Rica 81

Jeffrey J. Ryan

University of Arkansas

Decentralization and Democratic Instability:

The Case of Costa Rica

This article examines the consequences of the decentralization process that is under way in Costa

Rica and which may undermine, rather than bolster, democracy in that country. I first outline three

key contextual variables relating to the reform process: existing sociopolitical realities (construct-

ing local legitimacy), the dynamics of the reform process (bottom-up versus top-down), and the

timing or sequencing of the proposed reforms (what is being decentralized and when). Though I

focus here on Costa Rica, these three variables are generally applicable in any case of decentrali-

zation. After considering these contextual factors, I evaluate the likelihood of four negative side

effects arising from the ongoing decentralization process: party-system fragmentation, reinforced

or mutated clientelism, intermunicipal conflict and polarization, and local government instability.

Early evidence suggests that some of these effects, particularly party-system fragmentation and

municipal instability, have begun to manifest themselves.

Decentralization and state reform are generally seen, at

least by their proponents, as catalysts for rectifying per-

ceived shortcomings in the economic and political systems

to which such reforms are applied. On the economic side,

decentralization tends to be incorporated into a broad

framework of state reform that is informed by the market-

oriented critique of traditional statist development mod-

els. Fiscal decentralization, wherein the central government

transfers substantial spending and taxing authority to

subnational entities, is designed to achieve the archetypal

market goals of efficiency, rationalization, and discipline

(Artana and López Murphy 1994; Dillinger 1994). In the

political realm, decentralization is situated in the larger

context of democratization, where it is seen as playing a

key role in enhancing participation, responsiveness, and

accountability (Abers 1996; Blair 2000; Campbell 1993;

Faguet 2001).

It is precisely because decentralization has been associ-

ated with such “virtuous” effects that Latin America came

to see it as the best—if not the only—solution to the sys-

temic economic and political crises of the 1980s and 1990s.

The catastrophic economic declines of la década perdida

(the lost decade) and the hemispheric transitions away from

authoritarian rule combined to create a widespread decen-

tralizing impulse throughout region. The speed and scope

of the reforms ultimately undertaken, of course, varied

widely across countries. To a certain extent, this variation

was linked to the depth and nature of the specific crisis

that each nation was experiencing. Decentralization reforms

driven more by political motives, for example, tended to

be concentrated in countries where democracy was either

newly minted (Guatemala, El Salvador) or in serious dis-

repair (Colombia). Elsewhere, decentralization was under-

taken where deteriorating economic conditions had become

socially explosive, such as in Bolivia and Venezuela.

By contrast, countries that did not experience profound

crises tended to be much slower and more limited in ap-

proaching reform. Costa Rica is one such country. While

the nation’s economy suffered sustained and serious de-

clines throughout the 1980s and 1990s, it did not experi-

ence the disastrous freefall that befell some of its Latin

American neighbors. And although the political system was

battered to a certain extent—particularly in relation to the

military conflicts that engulfed Central America in the

1980s—its long-standing democracy was never in danger.

For this reason, and because Costa Rica has historically

Jeffrey J. Ryan is an associate professor of political science and Latin Ameri-

can studies at the University of Arkansas, where he is also a member of the

Center for the Study of Representation. His current research focuses on the

impact of decentralization and economic reforms on political stability in Latin

America. His work has been published in

Comparative Politics, Party Poli-

tics, PS: Political Science and Politics, Journal of Public Administration Edu-

cation,

and

Midsouth Political Science Journal.

E-mail: jeffr@uark.edu.