Decentralization or decentralisation is the process of redistributing or dispersing functions, powers, people or things away from a central location or authority. [2] [3] While centralization, especially in the governmental sphere, is widely studied and practiced, there's no common definition or understanding of decentralization. The meaning of decentralisation might vary in part because of the different ways it is applied. [4] Concepts of decentralisation have been applied to group dynamics and management science in private businesses and organizations, political science , law and public administration , economics and technology .


The word "centralization" came into use in France in 1794 as the post- French Revolution French Directory leadership created a new government structure. The word "decentralization" came into usage in the 1820s. [5] "Centralization" entered written English in the first third of the 1800s; [6] mentions of decentralisation additionally first appear throughout those years. In the mid-1800s Alexis de Tocqueville wrote that the French Revolution began with "a push towards decentralization...[but became,]in the end, an extension of centralization." [7] In 1863 retired French bureaucrat Maurice Block wrote an article called “Decentralization” for a French journal which reviewed the dynamics of government and bureaucratic centralization and recent French efforts at decentralisation of government functions. [8]

Ideas of liberty and decentralisation were carried to their logical conclusions throughout the nineteenth and twentieth centuries by anti-state political activists calling themselves " anarchists ", " libertarians ," and even decentralists. Alexis de Tocqueville was an advocate, writing: "Decentralization has, not only an administrative value, but additionally a civic dimension, after it increases the opportunities for citizens to take interest in public affairs; it makes them get accustomed to using freedom. And from the accumulation of these local, active, persnickety freedoms, is born the most efficient counterweight against the claims of the central government, even if it were supported by an impersonal, collective will." [9] Pierre-Joseph Proudhon (1809–1865), influential anarchist theorist [10] wrote: "All my economic ideas as developed over twenty-five years can be summed up in the words: agricultural-industrial federation. All my political ideas boil down to a similar formula: political federation or decentralization." [2]

In early twentieth century America a response to the centralization of economic wealth and political power was a decentralist movement. It blamed large-scale industrial production for destroying middle class shop keepers and small manufacturers and promoted increased property ownership and a return to small scale living. The decentralist movement attracted Southern Agrarians like Robert Penn Warren , as well as journalist Herbert Agar . [2] New Left and libertarian individuals who identified with social, economic, and most often political decentralism through the ensuing years included Ralph Borsodi , Wendell Berry , Paul Goodman , Carl Oglesby , Karl Hess , Donald Livingston , Kirkpatrick Sale (author of Human Scale ), [2] Murray Bookchin , [2] Dorothy Day , [2] Senator Mark O. Hatfield , [2] Mildred J. Loomis [2] and Bill Kauffman . [2]

Leopold Kohr , author of the 1957 book The Breakdown of Nations —known for its statement “Whenever something is wrong, something is too big”—was a major influence on E.F. Schumacher , author of the 1973 bestseller Small is Beautiful:Economics As If People Mattered . [2] [2] In the next few years a number of best-selling books promoted decentralization. Daniel Bell 's The Coming of Post-Industrial Society discussed the need for decentralisation and a “comprehensive overhaul of government structure to find the appropriate size and scope of units”, as well as the need to detach functions from current state boundaries, creating regions based on functions like water, transport, education and economics which might have “different ‘overlays’ on the map.” [3] [3] Alvin Toffler published Future Shock (1970) and The Third Wave (1980). Discussing the books in a later interview, Toffler said that industrial-style, centralized, top-down bureaucratic planning would be replaced by a more open, democratic, decentralised style which he called “anticipatory democracy.” [3] Futurist John Naisbitt 's 1982 book “Megatrends” was on The New York Times Best Seller list for more than two years and sold 14 million copies. [3] Naisbitt’s book outlines 10 “megatrends”, the fifth of which is from centralization to decentralization. [3] In 1996 David Osborne and Ted Gaebler had a best selling book Reinventing Government proposing decentralist public administration theories which became labelled the " New Public Management ". [3]

Stephen Cummings wrote that decentralisation became a "revolutionary megatrend" in the 1980s. [3] In 1983 Diana Conyers asked if decentralisation was the "latest fashion" in development administration. [3] Cornell University 's project on Restructuring Local Government states that decentralisation refers to the "global trend" of devolving responsibilities to regional or local governments. [29] Robert J. Bennett's Decentralization, Intergovernmental Relations and Markets: Towards a Post-Welfare Agenda describes how after World War II governments pursued a centralised "welfarist" policy of entitlements which now has become a "post-welfare" policy of intergovernmental and market-based decentralization. [29]

According to a 1999 United Nations Development Programme report:

"A large number of developing and transitional countries have embarked on a few form of decentralisation programmes. This trend is coupled with a growing interest in the role of civil society and the private sector as partners to governments in seeking new ways of service delivery...Decentralization of governance and the strengthening of local governing capacity is in part additionally a function of broader societal trends. These include, for example, the growing distrust of government generally, the spectacular demise of a few of the most centralised regimes in the world (especially the Soviet Union) and the emerging separatist demands that seem to routinely pop up in one or another part of the world. The movement toward local accountability and greater control over one's destiny is, however, not solely the result of the negative attitude towards central government. Rather, these developments, as we have already noted, are principally being driven by a strong desire for greater participation of citizens and private sector organisations in governance.” [3]


Systems approach

Those studying the goals and processes of implementing decentralisation most often use a systems theory approach. The United Nations Development Programme report applies to the topic of decentralisation "a whole systems perspective, including levels, spheres, sectors and functions and seeing the community level as the entry point at which holistic definitions of development goals are most likely to emerge from the people themselves and where it is most practical to support them. It involves seeing multi-level frameworks and continuous, synergistic processes of interaction and iteration of cycles as critical for achieving wholeness in a decentralized system and for sustaining its development.” [4]

However, decentralisation itself has been seen as part of a systems approach. Norman Johnson of Los Alamos National Laboratory wrote in a 1999 paper: "A decentralised system is where a few decisions by the agents are made without centralised control or processing. An important property of agent systems is the degree of connectivity or connectedness between the agents, a measure global flow of information or influence. If each agent is connected (exchange states or influence) to all additional agents, then the system is highly connected." [30]

University of California, Irvine 's Institute for Software Research's "PACE" project is creating an "architectural style for trust management in decentralised applications." It adopted Rohit Khare 's definition of decentralization: "A decentralised system is one which requires multiple parties to make their own independent decisions" and applies it to Peer-to-peer software creation, writing:

...In such a decentralised system, there's no single centralised authority that makes decisions on behalf of all the parties. Instead each party, additionally called a peer, makes local autonomous decisions towards its individual goals which might possibly conflict with those of additional peers. Peers directly interact with each additional and share information or provide service to additional peers. An open decentralised system is one in which the entry of peers isn't regulated. Any peer can enter or leave the system at any time... [4]


Decentralization in any area is a response to the problems of centralised systems. Decentralization in government, the topic most studied, has been seen as a solution to problems like economic decline, government inability to fund services and their general decline in performance of overloaded services, the demands of minorities for a greater say in local governance, the general weakening legitimacy of the public sector and global and international pressure on countries with inefficient, undemocratic, overly centralised systems. [32] The following four goals or objectives are frequently stated in numerous analyses of decentralization.

In decentralisation the principle of subsidiarity is most often invoked. It holds that the lowest or least centralised authority which is capable of addressing an issue effectively should do so. According to one definition: "Decentralization, or decentralising governance, refers to the restructuring or reorganisation of authority so that there's a system of co-responsibility between institutions of governance at the central, regional and local levels according to the principle of subsidiarity, thus increasing the overall quality and effectiveness of the system of governance, while increasing the authority and capacities of sub-national levels." [4]

Decentralization is most often linked to concepts of participation in decision-making, democracy, equality and liberty from higher authority. [4] [4] Decentralization enhances the democratic voice. [29] Theorists believe that local representative authorities with actual discretionary powers are the basis of decentralisation that can lead to local efficiency, equity and development.” [4] Columbia University 's Earth Institute identified one of three major trends relating to decentralisation as: "increased involvement of local jurisdictions and civil society in the management of their affairs, with new forms of participation, consultation, and partnerships." [9]

Decentralization has been described as a "counterpoint to globalization" which removes decisions from the local and national stage to the global sphere of multi-national or non-national interests. Decentralization brings decision-making back to the sub-national levels. Decentralization strategies must account for the interrelations of global, regional, national, sub-national, and local levels. [4]

Norman L. Johnson writes that diversity plays an important role in decentralised systems like ecosystems , social groups , large organizations, political systems . "Diversity is defined to be unique properties of entities, agents, or individuals that aren't shared by the larger group, population, structure. Decentralized is defined as a property of a system where the agents have a few ability to operate "locally.” Both decentralisation and diversity are necessary attributes to achieve the self-organizing properties of interest." [30]

Advocates of political decentralisation hold that greater participation by better informed diverse interests in society will lead to more relevant decisions than those made only by authorities on the national level. [36] Decentralization has been described as a response to demands for diversity. [9] [5]

In business, decentralisation leads to a management by results philosophy which focuses on definite objectives to be achieved by unit results. [5] Decentralization of government programmes is said to increase efficiency - and effectiveness - due to reduction of congestion in communications, quicker reaction to unanticipated problems, improved ability to deliver services, improved information about local conditions, and more support from beneficiaries of programs. [5]

Firms might prefer decentralisation because it ensures efficiency by making sure that managers closest to the local information make decisions and in a more timely fashion; that their taking responsibility frees upper management for long term strategics rather than day-to-day decision-making; that managers have hands on training to prepare them to move up the management hierarchy; that managers are motivated by having the freedom to exercise their own initiative and creativity; that managers and divisions are encouraged to prove that they're profitable, instead of allowing their failures to be masked by the overall profitability of the company. [5]

The same principles can be applied to government. Decentralization promises to enhance efficiency through both inter-governmental competition with market features and fiscal discipline which assigns tax and expenditure authority to the lowest level of government possible. It works best where members of subnational government have strong traditions of democracy, accountability and professionalism. [29]

Conflict resolution
Economic and/or political decentralisation can help prevent or reduce conflict because they reduce actual or perceived inequities between numerous regions or between a region and the central government. [5] Dawn Brancati finds that political decentralisation reduces intrastate conflict unless politicians create political parties that mobilise minority and even extremist groups to demand more resources and power within national governments. Notwithstanding the likelihood this will be done depends on factors like how democratic transitions happen and features like a regional party's proportion of legislative seats, a country's number of regional legislatures, elector procedures, and the order in which national and regional elections occur. Brancati holds that decentralisation can promote peace if it encourages statewide parties to incorporate regional demands and limit the power of regional parties. [5]


The processes of decentralisation redefines structures, procedures and practises of governance to be closer to the citizenry and to make them more aware of the costs and benefits; it isn't merely a movement of power from the central to the local government. According to the United Nations Development Programme, it is "more than a process, it is a way of life and a state of mind." The report provides a chart-formatted framework for defining the application of the concept ‘decentralization’ describing and elaborating on the "who, what, when, where, why and how" factors in any process of decentralization. [5]


The processes by which entities move from a more to a less centralised state vary. They can be initiated from the centres of authority (" top-down ") or from individuals, localities or regions (" bottom-up "), [42] or from a "mutually desired" combination of authorities and localities working together. [5] Bottom-up decentralisation most of the time stresses political values like local responsiveness and increased participation and tends to increase political stability. Top-down decentralisation might be motivated by the desire to “shift deficits downwards” and find more resources to pay for services or pay off government debt. [42] Some hold that decentralisation shouldn't be imposed, but done in a respectful manner. [5]

Analysis of operations
Project and programme planners must assess the lowest organisational level at which functions can be carried out efficiently and effectively. Governments deciding to privatise functions must decide which are best privatized. Existing types of decentralisation must be studied. The appropriate balance of centralization and decentralisation should be studied. Training for both national and local managers and officials is necessary, as well as technical assistance in the planning, financing, and management of decentralised functions. [44]

Appropriate size
Gauging the appropriate size or scale of decentralised units has been studied in relation to the size of sub-units of hospitals [6] and schools, [32] road networks, [6] administrative units in business [6] and public administration, and especially town and city governmental areas and decision making bodies. [6] [6]

In creating planned communities ("new towns"), it is important to determine the appropriate population and geographical size. While in earlier years small towns were considered appropriate, by the 1960s, 60,000 inhabitants was considered the size necessary to support a diversified job market and an adequate shopping centre and array of services and entertainment. Appropriate size of governmental units for revenue raising additionally is a consideration. [6]

Even in bioregionalism , which seeks to reorder a large number of functions and even the boundaries of governments according to physical and environmental features, including watershed boundaries and soil and terrain characteristics, appropriate size must be considered. The unit might be larger than a large number of decentralist bioregionalists prefer. [6]

Inadvertent or silent

Decentralization ideally happens as a careful, rational, and orderly process, but it most often takes place throughout times of economic and political crisis, the fall of a regime and the resultant power struggles. Even when it happens slowly, there's a need for experimentation, testing, adjusting, and replicating successful experiments in additional contexts. There is no one blueprint for decentralisation after it depends on the initial state of a country and the power and views of political interests and whether they support or oppose decentralization. [6]

Decentralization most of the time is conscious process based on explicit policies. Notwithstanding it might occur as "silent decentralization" in the absence of reforms as changes in networks, policy emphasise and resource availability lead inevitably to a more decentralised system. [6] A variation on this is "inadvertent decentralization", when additional policy innovations produce an unintended decentralisation of power and resources. In both China and Russia, lower level authorities attained greater powers than intended by central authorities.


Decentralization might be uneven and "asymmetric" given any one country's population, political, ethnic and additional forms of diversity. In a large number of countries, political, economic and administrative responsibilities might be decentralised to the larger urban areas, while rural areas are administered by the central government. Decentralization of responsibilities to provinces might be limited only to those provinces or states which want or are capable of handling responsibility. Some privatisation might be more appropriate to an urban than a rural area; a few types of privatisation might be more appropriate for a few states and provinces but not others.


Measuring the amount of decentralization, especially politically, is difficult because different studies of it use different definitions and measurements. An OECD study quotes Chanchal Kumar Sharma as stating: [50] "a true assessment of the degree of decentralisation in a country can be made only if a comprehensive approach is adopted and rather than trying to simplify the syndrome of characteristics into the single dimension of autonomy, interrelationships of numerous dimensions of decentralisation are taken into account." [51]

Government decentralization

Historians have described the history of governments and empires in terms of centralization and decentralization. In his 1910 The History of Nations Henry Cabot Lodge wrote that Persian king Darius I (550-486 BCE) was a master of organisation and “for the first time in history centralization becomes a political fact.” He additionally noted that this contrasted with the decentralisation of Ancient Greece . [52] Since the 1980s a number of scholars have written about cycles of centralization and decentralizations. Stephen K. Sanderson wrote that over the last 4000 years chiefdoms and actual states have gone through sequences of centralization and decentralisation of economic, political and social power. [53] Yildiz Atasoy writes this process has been going on “since the Stone Age” through not just chiefdoms and states, but empires and today’s “hegemonic core states”. [54] Christopher K. Chase-Dunn and Thomas D. Hall review additional works that detail these cycles, including works which analyse the concept of core elites which compete with state accumulation of wealth and how their "intra-ruling-class competition accounts for the rise and fall of states" and of their phases of centralization and decentralization. [55]

Rising government expenditures, poor economic performance and the rise of free market -influenced ideas have convinced governments to decentralise their operations, to induce competition within their services, to contract out to private firms operating in the market, and to privatise a few functions and services entirely. [56]

Government decentralisation has both political and administrative aspects. Its decentralisation might be territorial, moving power from a central city to additional localities, and it might be functional, moving decision-making from the top administrator of any branch of government to lower level officials, or divesting of the function entirely through privatization. It has been called the " new public management " which has been described as decentralization, management by objectives, contracting out, competition within government and consumer orientation. [8]


Political decentralisation aims to give citizens or their elected representatives more power . It might be associated with pluralistic politics and representative government , but it additionally means giving citizens , or their representatives, more influence in the formulation and implementation of laws and policies. Depending on the country, this might require constitutional or statutory reforms, the development of new political parties , increased power for legislatures , the creation of local political units, and encouragement of advocacy groups . [36]


Four major forms of administrative decentralisation have been described. [44] [8]

  • Deconcentration, the weakest form of decentralization, shifts responsibility for decision-making, finance and implementation of certain public functions [8] from officials of central governments to those in existing districts or, if necessary, new ones under direct control of the central government.
  • Delegation passes down responsibility for decision-making, finance and implementation of certain public functions to semi-autonomous organisations not wholly controlled by the central government, but ultimately accountable to it. It involves the creation of public-private enterprises or corporations, or of "authorities", special projects or service districts. All of them will have a great deal of decision-making discretion and they might be exempt from civil service requirements and might be permitted to charge users for services.
  • Devolution transfers all responsibility for decision-making, finance and implementation of certain public functions to the sub-national level, like a regional, local, or state government.
  • Divestment , additionally called privatization , might mean merely contracting out services to private companies. Or it might mean relinquishing totally all responsibility for decision-making, finance and implementation of certain public functions. Facilities will be sold off, workers transferred or fired and private companies or non-for-profit organisations allowed to provide the services. [8] Many of these functions originally were done by private individuals, companies, or associations and later taken over by the government, either directly, or by regulating out of business entities which competed with newly created government programs. [8]


Fiscal decentralisation means decentralising revenue raising and/or expenditure of moneys to a lower level of government while maintaining financial responsibility. [44] While this process most of the time is called fiscal federalism it might be relevant to unitary, federal and confederal governments. Fiscal federalism additionally concerns the "vertical imbalances" where the central government gives too much or too little money to the lower levels. It actually can be a way of increasing central government control of lower levels of government, if it isn't linked to additional kinds of responsibilities and authority. [8] [8] [8]

Fiscal decentralisation can be achieved through user fees, user participation through monetary or labour contributions, expansion of local property or sales taxes, intergovernmental transfers of central government tax monies to local governments through transfer payments or grants , and authorization of municipal borrowing with national government loan guarantees. Transfers of money might be given conditionally with instructions or unconditionally without them. [44] [8]

Economic or market

Economic decentralisation can be done through privatisation of public owned functions and businesses, as described briefly above. But it additionally is done through deregulation , the abolition of restrictions on businesses competing with government services, for example, postal services, schools, garbage collection. Even as private companies and corporations have worked to have such services contracted out to or privatised by them, others have worked to have these turned over to non-profit organisations or associations, [44]

Since the 1970s there has been deregulation of a few industries, like banking, trucking, airlines and telecommunications which resulted ordinarily in more competition and lower prices. According to Cato Institute , an American libertarian think-tank, a few industries deregulation of aspects of an industry were offset by more ambitious regulations elsewhere that hurt consumers, the electricity industry being a prime example. [62] For instance, in banking, Cato Institute believes a few deregulation allowed banks to compete across state lines, increasing consumer choice, while an actual increase in regulators and regulations forced banks to do business the way central government regulators commanded, including making loans to individuals incapable of repaying them, leading eventually to the financial crisis of 2007–2008 . [63]

One example of economic decentralization, which is based on a libertarian socialist model, is decentralized economic planning . Decentralized planning is a type of economic system in which decision-making is distributed amongst numerous economic agents or localised within production agents. An example of this method in practise is in Kerala , India which started in 1996 as, The People's Planning in Kerala . [64]

Some argue that government standardisation in areas from commodity market , inspection and testing procurement bidding , Building codes , professional and vocational education , trade certification , safety , etc. are necessary. Emmanuelle Auriol and Michel Benaim write about the "comparative benefits" of decentralisation versus government regulation in the setting of standards. They find that while there might be a need for public regulation if public safety is at stake, private creation of standards most of the time is better because "regulators or 'experts' might misrepresent consumers' tastes and needs." As long as companies are averse to incompatible standards, standards will be created that satisfy needs of a modern economy. [65]


Central governments themselves might own large tracts of land and control the forest, water, mineral, wildlife and additional resources they contain. They might manage them through government operations or leasing them to private businesses; or they might neglect them to be exploited by individuals or groups who defy non-enforced laws against exploitation. It additionally might control most private land through land-use, zoning, environmental and additional regulations. [66] Selling off or leasing lands can be profitable for governments willing to relinquish control, but such programmes can face public scrutiny because of fear of a loss of heritage or of environmental damage. Devolution of control to regional or local governments has been found to be an effective way of dealing with these concerns. [67] Such decentralisation has happened in India and additional third world nations. [68]

Ideological decentralization

Libertarian socialist decentralization

Libertarian socialism is a group of political philosophies that promote a non-hierarchical, non-bureaucratic society without private property in the means of production . Libertarian socialists believe in converting present-day private productive property into common or public goods . [69] Libertarian socialism is opposed to coercive forms of social organization. It promotes free association in place of government and opposes the social relations of capitalism, like wage labor . [10] The term libertarian socialism is used by a few socialists to distinguish their philosophy from state socialism , [10] [10] and by a few as a synonym for left anarchism . [10]

Accordingly, libertarian socialists believe that "the exercise of power in any institutionalised form—whether economic, political, religious, or sexual—brutalizes both the wielder of power and the one over whom it is exercised". [10] Libertarian socialists ordinarily place their hopes in decentralised means of direct democracy like libertarian municipalism , citizens' assemblies, or workers' councils . [10] Libertarian socialists are strongly critical of coercive institutions, which most often leads them to reject the legitimacy of the state in favour of anarchism. [10] Adherents propose achieving this through decentralisation of political and economic power, most of the time involving the socialisation of most large-scale private property and enterprise (while retaining respect for personal property ). Libertarian socialism tends to deny the legitimacy of most forms of economically significant private property, viewing capitalist property relations as forms of domination that are antagonistic to individual freedom. [10] [2]

Political philosophies commonly described as libertarian socialist include most varieties of anarchism (especially anarchist communism , anarchist collectivism , anarcho-syndicalism , [2] and mutualism [2] ) as well as autonomism , communalism , participism , libertarian Marxist philosophies like council communism and Luxemburgism , and a few versions of " utopian socialism " [2] and individualist anarchism . [2] [2] [2] For Murray Bookchin "In the modern world, anarchism first appeared as a movement of the peasantry and yeomanry against declining feudal institutions. In Germany its foremost spokesman throughout the Peasant Wars was Thomas Muenzer ; in England, Gerrard Winstanley, a leading participant in the Digger movement. The concepts held by Muenzer and Winstanley were superbly attuned to the needs of their time — a historical period when the majority of the population lived in the countryside and when the most militant revolutionary forces came from an agrarian world. It would be painfully academic to argue whether Muenzer and Winstanley could have achieved their ideals. What is of real importance is that they spoke to their time; their anarchist concepts followed naturally from the rural society that furnished the bands of the peasant armies in Germany and the New Model in England." [2] The term "anarchist" first entered the English language in 1642, throughout the English Civil War , as a term of abuse , used by Royalists against their Roundhead opponents. [76] By the time of the French Revolution some, like the Enragés , began to use the term positively, [2] in opposition to Jacobin centralisation of power, seeing "revolutionary government" as oxymoronic . [76] By the turn of the nineteenth century, the English word "anarchism" had lost its initial negative connotation. [76]

For Proudhon , mutualism involved creating "industrial democracy," a system where workplaces would be "handed over to democratically organised workers' associations . . . We want these associations to be models for agriculture, industry and trade, the pioneering core of that vast federation of companies and societies woven into the common cloth of the democratic social Republic." [2] He urged "workers to form themselves into democratic societies, with equal conditions for all members, on pain of a relapse into feudalism." This would result in "Capitalistic and proprietary exploitation, stopped everywhere, the wage system abolished, equal and just exchange guaranteed." [2] Workers would no longer sell their labour to a capitalist but rather work for themselves in co-operatives. Anarcho-communism calls for a confederal form in relationships of mutual aid and free association between communes as an alternative to the centralism of the nation-state . Peter Kropotkin thus suggested that "Representative government has accomplished its historical mission; it has given a mortal blow to court-rule; and by its debates it has awakened public interest in public questions. But to see in it the government of the future socialist society is to commit a gross error. Each economic phase of life implies its own political phase; and it is impossible to touch the quite basis of the present economic life-private property -without a corresponding change in the quite basis of the political organization. Life already shows in which direction the change will be made. Not in increasing the powers of the State, but in resorting to free organisation and free federation in all those branches which are now considered as attributes of the State." [2] When the First Spanish Republic was established in 1873 after the abdication of King Amadeo, the first president, Estanislao Figueras, named Francesc Pi i Margall Minister of the Interior. His acquaintance with Proudhon enabled Pi to warm relations between the Republicans and the socialists in Spain. Pi i Margall became the principal translator of Proudhon's works into Spanish [2] and later briefly became president of Spain in 1873 while being the leader of the Democratic Republican Federal Party. According to George Woodcock "These translations were to have a profound and lasting effect on the development of Spanish anarchism after 1870, but before that time Proudhonian ideas, as interpreted by Pi, already provided much of the inspiration for the federalist movement which sprang up in the early 1860's." [2] According to the Encyclopedia Britannica "During the Spanish revolution of 1873, Pi y Margall attempted to establish a decentralized, or “cantonalist,” political system on Proudhonian lines." [2]

To date, the best-known examples of an anarchist communist society (i.e., established around the ideas as they exist today and achieving worldwide attention and knowledge in the historical canon), are the anarchist territories throughout the Spanish Revolution [79] and the Free Territory throughout the Russian Revolution . Through the efforts and influence of the Spanish Anarchists throughout the Spanish Revolution within the Spanish Civil War , starting in 1936 anarchist communism existed in most of Aragon, parts of the Levante and Andalusia, as well as in the stronghold of Anarchist Catalonia before being crushed by the combined forces of the regime that won the war , Hitler , Mussolini , Spanish Communist Party repression (backed by the USSR) as well as economic and armaments blockades from the capitalist countries and the Second Spanish Republic itself. [2] Throughout the Russian Revolution, anarchists like Nestor Makhno worked to create and defend—through the Revolutionary Insurrectionary Army of Ukraine —anarchist communism in the Free Territory of Ukraine from 1919 before being conquered by the Bolsheviks in 1921. Several libertarian socialists, notably Noam Chomsky amongst others, believe that anarchism shares much in common with certain variants of Marxism (see libertarian marxism ) like the council communism of Marxist Anton Pannekoek . In Chomsky's Notes on Anarchism , [80] he suggests the possibility "that a few form of council communism is the natural form of revolutionary socialism in an industrial society. It reflects the belief that democracy is severely limited when the industrial system is controlled by any form of autocratic elite, whether of owners, managers, and technocrats, a ' vanguard' party , or a State bureaucracy." [80]

Free market decentralization

Free market ideas popular in the nineteenth century, like those of Adam Smith returned to prominence in the 1970s and 1980s. Nobel Prize –winning economist Friedrich von Hayek emphasised that free markets themselves are decentralised systems where outcomes are produced without explicit agreement or coordination by individuals who use prices as their guide. [2] As Eleanor Doyle writes: "Economic decision-making in free markets is decentralised across all the individuals dispersed in each market and is synchronised or coordinated by the price system." The individual right to property is part of this decentralised system. [2] Analyzing the problems of central government control, Hayek wrote in The Road to Serfdom :

There would be no difficulty about efficient control or planning were conditions so simple that a single person or board could effectively survey all the relevant facts. It is only as the factors which have to be taken into account become so numerous that it is impossible to gain a synoptic view of them that decentralisation becomes imperative. [2]

According to Bruce M. Owen , this doesn't mean that all firms themselves have to be equally decentralized. He writes: "markets allocate resources through arms-length transactions amongst decentralised actors. Much of the time, markets work quite efficiently, but there's a variety of conditions under which firms do better. Hence, goods and services are produced and sold by firms with numerous degrees of horizontal and vertical integration." Additionally, he writes that the "economic incentive to expand horizontally or vertically is usually, but not always, compatible with the social interest in maximising long-run consumer welfare." When it does not, he writes regulation might be necessary. [84]

It most often is claimed that free markets and private property generate centralised monopolies and additional ills; the counter is that government is the source of monopoly. [2] Historian Gabriel Kolko in his book The Triumph of Conservatism argued that in the first decade of the twentieth century businesses were highly decentralised and competitive, with new businesses constantly entering existing industries. There was no trend towards concentration and monopolization. While there were a wave of mergers of companies trying to corner markets, they found there was too much competition to do so. This additionally was true in banking and finance, which saw decentralisation as leading to instability as state and local banks competed with the big New York City firms. The largest firms turned to the power of the state and working with leaders like United States Presidents Theodore Roosevelt , William H. Taft and Woodrow Wilson passed as "progressive reforms" centralising laws like The Federal Reserve Act of 1913 that gave control of the monetary system to the wealthiest bankers; the formation of monopoly "public utilities" that made competition with those monopolies illegal; federal inspection of meat packers biassed against small companies; extending Interstate Commerce Commission to regulating telephone companies and keeping rates high to benefit AT&T ; and using the Sherman Anti-trust Act against companies which might combine to threaten larger or monopoly companies. [2] [2] When government licensing, franchises, and additional legal restrictions create monopoly and protect companies from open competition, deregulation is the solution. [2]

Author and activist Jane Jacobs 's influential 1961 book The Death and Life of American Cities criticised large-scale redevelopment projects which were part of government-planned decentralisation of population and businesses to suburbs. She believed it destroyed cities' economies and impoverished remaining residents. [2] Her 1980 book The Question of Separatism: Quebec and the Struggle over Sovereignty supported secession of Quebec from Canada . [2] Her 1984 book Cities and the Wealth of Nations proposed a solution to the numerous ills plaguing cities whose economies were being ruined by centralised national governments: decentralisation through the "multiplication of sovereignties", i.e., acceptance of the right of cities to secede from the larger nation states that were squelching their ability to produce wealth. [2] [2]

Technological decentralization

Technology includes tools, materials, skills, techniques and processes by which goals are accomplished in the public and private spheres. Concepts of decentralisation of technology are used throughout all types of technology , including especially information technology and appropriate technology .

Technologies most often mentioned as best implemented in a decentralised manner, include: water purification, delivery and waste water disposal, [2] [2] agricultural technology [2] and energy technology. [2] Advancing technology might allow decentralized, privatised and free market solutions for what have been public services, such utilities producing and/or delivering power, water, mail, telecommunications and services like consumer product safety, money and banking, medical licencing and detection and metering technologies for highways, parking, and auto emissions. [2] Notwithstanding in terms of technology, a clear distinction between fully centralised or decentralised technical solutions is most often not possible and therefore finding an optimal degree of centralization difficult from an infrastructure planning perspective. [2]

Information technology

Information technology encompasses computers and computer networks, as well as information distribution technologies like television and telephones. The whole computer industry of computer hardware , software , electronics , internet , telecommunications equipment , e-commerce and computer services are included. [2]

Executives and managers face a constant tension between centralising and decentralising information technology for their organizations. They must find the right balance of centralising which lowers costs and allows more control by upper management, and decentralising which allows sub-units and users more control. This will depend on analysis of the specific situation. Decentralization is particularly applicable to business or management units which have a high level of independence, complicated products and customers, and technology less relevant to additional units. [2]

Information technology applied to government communications with citizens, most often called e-Government , is supposed to support decentralisation and democratization. Various forms have been instituted in most nations worldwide. [2]

The internet is an example of an extremely decentralised network, having no owners at all (although a few have argued that this is less the case in recent years [99] ). "No one is in charge of internet, and everyone is." As long as they follow a certain minimal number of rules, anyone can be a service provider or a user. Voluntary boards establish protocols, but can't stop anyone from developing new ones. [2] Other examples of open source or decentralised movements are Wikis which allow users to add, modify, or delete content via the internet. [2] Wikipedia has been described as decentralized. [2] Smartphones have greatly increased the role of decentralised social network services in daily lives worldwide. [2]

Decentralization continues throughout the industry, for example as the decentralised architecture of wireless routers installed in homes and offices supplement and even replace phone companies relatively centralised long-range cell towers. [2]

Inspired by system and cybernetics theorists like Norbert Wiener , Marshall McLuhan and Buckminster Fuller , in the 1960s Stewart Brand started the Whole Earth Catalog and later computer networking efforts to bring Silicon Valley computer technologists and entrepreneurs together with countercultural ideas. This resulted in ideas like personal computing , virtual communities and the vision of an "electronic frontier" which would be a more decentralized, egalitarian and free-market libertarian society. Related ideas coming out of Silicon Valley included the free software and creative commons movements which produced visions of a "networked information economy". [2]

Because human interactions in cyberspace transcend physical geography, there's a necessity for new theories in legal and additional rule-making systems to deal with decentralised decision-making processes in such systems. For instance, what rules should apply to conduct on the global digital network and who should set them? The laws of which nations govern issues of internet transactions (like seller disclosure requirements or definitions of "fraud"), copyright and trademark? [2]

Architectural, political and logical decentralization

Viewing systems as logically, arcitecturally and politically centralized or decentralized

According to a proposal by the founder of Ethereum , Vitalik Buterin , systems can be categorized along the axes of architectural, political and logical centralization or decentralization. [124]

  • Architectural decentralization (one or many physical systems?)
  • Political decentralization (controlled by one person/entity or many?)
  • Logical decentralization (is the interface or data structure a singleton, or an amorphous swarm?)

For example, Plato's five regimes , traditional corporations, as well as military and hospitals can be viewed as centralized in all three of those dimensions. In contrast, some but not all Languages are being used and evolve in an entirely decentralized manner. Blockchains , although widely acknowledged as a decentralizing force, serve to actually logically centralize record keeping by the use of a single ledger which is distributed and updated across network participants.

This framework is relevant to the implementation of Global governance .

Centralization and redecentralization of the Internet

The New Yorker reports that although the Internet was originally decentralized, in recent years it has become less so: "a staggering percentage of communications flow through a small set of corporations—and thus, under the profound influence of those companies and additional institutions [...] One solution, espoused by a few programmers, is to make the Internet more like it used to be—less centralised and more distributed." [99]

Examples of projects that attempt to contribute to the redecentralization of the Internet include ArkOS, Diaspora , FreedomBox , Namecoin , twtxt, and ZeroNet as well as advocacy group, which provides support for projects that aim to make the Web less centralized. [99]

In an interview with BBC Radio 5 Live one of the co-founders of explained that:

"As we've gone on there's been more and more internet traffic focused through particular nodes like Google or Facebook. [...] Centralised services that hold all the user data and host it themselves have become increasingly popular because that business model has worked. As the Internet has become more mass market, people aren't necessarily willing or knowledgable to host it themselves, so where that hosting is outsourced it's become the default, which allows a centralization of power and a centralization of data that I think is worrying." [2]

Appropriate technology

"Appropriate technology", originally described as "intermediate technology" by economist E. F. Schumacher in Small is Beautiful , is ordinarily recognised as encompassing technologies that are small-scale, decentralized, labor-intensive , energy-efficient, environmentally sound , and locally controlled. [110] It is most commonly discussed as an alternative to transfers of capital-intensive technology from industrialized nations to developing countries. [2] Even developed countries developed appropriate technologies, as did the United States in 1977 when it created the National Center for Appropriate Technology (NCAT), though funding later dropped off. [2] A related concept is "design for the additional 90 percent" - low-cost solutions for the great majority of the world's low income people. [2]


Factors hindering decentralisation include weak local administrative or technical capacity, which might result in inefficient or ineffective services; inadequate financial resources available to perform new local responsibilities, especially in the start-up phase when they're most needed; or inequitable distribution of resources. Decentralization can make national policy coordination too complex; it might allow local elites to capture functions; local cooperation might be undermined by any distrust between private and public sectors; decentralisation might result in higher enforcement costs and conflict for resources if there's no higher level of authority. [114] Additionally, decentralisation might not be as efficient for standardized, routine, network-based services, as opposed to those that need more complicated inputs. If there's a loss of economies of scale in procurement of labour or resources, the expense of decentralisation can rise, even as central governments lose control over financial resources. [44]

Other challenges, and even dangers, include the possibility that corrupt local elites can capture regional or local power centers, while constituents lose representation; patronage politics will become rampant and civil servants feel compromised; further necessary decentralisation can be stymied; incomplete information and hidden decision-making can occur up and down the hierarchies; centralised power centres can find reasons to frustrate decentralisation and bring power back to themselves.

It has been noted that while decentralisation might increase "productive efficiency" it might undermine "allocative efficiency" by making redistribution of wealth more difficult. Decentralization will cause greater disparities between rich and poor regions, especially throughout times of crisis when the national government might not be able to help regions needing it. [2]

Averting the Dangers of Decentralization: Eight Classic Conditions

The literature identifies eight essential preconditions that must be ensured while implementing decentralisation in order to avert the so-called “dangers of decentralization”. These are [2]

  1. Social Preparedness and Mechanisms to Prevent Elite Capture
  2. Strong Administrative and Technical Capacity at the Higher Levels
  3. Strong Political Commitment at the Higher Levels
  4. Sustained Initiatives for Capacity-Building at the Local Level
  5. Strong Legal Framework for Transparency and Accountability
  6. Transformation of Local Government Organizations into High Performing Organizations
  7. Appropriate Reasons to Decentralize: Intentions Matter
  8. Effective Judicial System, Citizens’ Oversight and Anticorruption Bodies to prevent Decentralization of Corruption