Oficina Regional de la FAO para América Latina y el Caribe |

The Performance of the Agricultural Services and the Role of the Local Government
Comparative Study Profile on the decentralization processes
in Brazil, Chile, Mexico and Peru

The decentralization reforms have emerged as important strategies to deal with public management problems in several Latin American countries. The transformation of the role of the State forced by the successive national debt crisis and fiscal deficit, pretended to find in the decentralization processes a mechanism to solve, at least in part, the problems of efficiency and effectiveness that harassed the State. That belief was based in the assumption that by delegating authority to the local governments, public administration would be "nearer the citizens" and therefore would be able to offer high quality public services. Nevertheless, an increasing amount of empirical evidence suggests that decentralization whether it be administrative, fiscal or political, or a combination of them, may not improve automatically the performance of the public services, particularly those related to the agricultural activity and rural development. In order to enhance the discussion on the role of the local government in public management of the agricultural services in an ever more decentralized environment, the FAO Regional Office for Latin America and the Caribbean is carrying out a regional study, comparing the experiences with decentralization reforms in the agricultural sector of four countries in the region: Brazil, Chile, Mexico and Peru.

Ideally, a public economy, just like its private sector equivalent, is “demand driven" and addresses citizens as "customers", with preferences in relation to the delivery and production of the public assets and services they require¹. Nevertheless, the execution of these processes in the region is challenged by several constraints. Many of the problems faced by the agricultural sector come from the difficulty in the production of public assets. In many countries of the region there is still inequity in agricultural land distribution; property rights are not quite clear, and due to the lack of functional planning systems, the use of land produces conflicts between agricultural, farming and silvicultural interests.

In many cases, the traditional political response has ignored the role of the local institutions in the solution of the collective action problems in the region. Nonetheless, recent empirical investigations have established that the local institutions, whether formal or informal, not only play a fundamental role in the mediation and filtration of the effects of public policies, but may also solve the problems of the collective action (Ostrom 1990, 1994; Oakerson 1998). Therefore, it is considered that the public policy instruments of the agricultural sector that take into account the function of the local institutions in the solution of problems related to the collective action, work in general, better than those instruments that ignore it. Nevertheless, this does not mean that a complete refund of the supply and production of public assets is productive, nor desired, since the solution of several collective action problems related to public management, requires a coordinated effort of stakeholders of various levels and functions. (McGinnis, 1999).

The present study states as central hypothesis that the performance level of public services in its attempt to alleviate poverty, stop environmental deterioration and foster the farming sector, is associated with the institutional arrangements for collective action at municipal level. Therefore, in places where the local stakeholders have managed to overcome the social dilemmas with the creation and maintenance of collective action institutions, a more suitable condition is present in order to achieve a greater level of performance of public services. The following hypotheses consider different aspects of the collective action at municipal level and are directly related to the central hypothesis:

Hypothesis 1: The municipal management systems that have generated positive incentives to motivate the local politicians to take actions bring about the presence of more agricultural services operating at municipal level (it deals with motivation problems in efforts to organize the collective action).
Hypothesis 2: The municipal management systems that have developed viable institutions for the transfer of information between the local stakeholders have access to relatively high quality public services (it deals with information problems in the collective action).
Hypothesis 3: The municipal management systems that have managed to involve the producers in the planning and implementation of actions related to agricultural services, may benefit from a greater performance of such services (it deals with empowerment in the collective action).

The hypotheses of the study will be corroborated with field work in Brazil, Chile, Mexico and Peru. In order to carry out the work at the field, FAO counts on the collaboration of several national organizations working in the four countries. The counterparts have three main tasks: (1) the validation of a monograph (desk study) on the public economy of the agricultural services and the role of the local government; (2) the validation and application of a survey instrument to three local stakeholders in each selected municipality²; and (3) the preparation of a final report with the analysis of the results of the surveys.

In Chile we worked with "Gestión & Desarrollo". We selected 40 rural municipalities in the IV-X and the Metropolitan Regions. In Brazil we collaborated with DESER in 50 municipalities of the 3 States of the South. In Mexico we have 2 counterparts (INDESO and Mayan Institute) to apply the survey in 150 municipalities of 24 States in the South and North-Center. In Peru, the partners are APOYO and Centro Ideas. We worked in a total of 100 municipalities in Coastal, Mountain range and Forest zones. From 23 to 25 July 2002 took place in Santiago, Chile, a work meeting with the participation of representatives of all the aforementioned national teams. Discussions approached theoretical, methodological and logistic issues. Furthermore, a draft of a possible regional project which would continue the study project through more concrete activities was submitted for discussions.

The comparative analysis between the four countries and the specific results of the study in Brazil will be published in December 2002. The published analysis pretends to identify and discuss the main implications of the study for public policy at municipal, state and federal level. During the preparation of the different products of the project, both FAO and the national counterparts will maintain a permanent dialogue with the representatives of the municipal, regional and central authorities to assure the high relevance of the prepared documents. It is expected that these discussions will produce a debate on possible lines of action and modifications in public policy that would facilitate the creation of a local economy mainly focused in the demands of the variety of agricultural producers. Between the follow-up activities to the study, it is expected that those involved in the project will explore the possible joint formulation of a series of public investment projects to strengthen the local management of the public services at rural level of the countries involved.

The regional study is coordinated by the FAO Assistant Director-General for Latin America and the Caribbean, Mr. Gustavo Gordillo. For further information refer to the full version in PDF (328 Kb) in Spanish (Executive Summary in English).

Obviously, one of the first activities carried out within the framework of the study was the search of the pertinent information of the four selected countries: Brazil, Mexico, Peru and Chile. A per country monograph was prepared in draft with the results of this search. These documents provide a general description of the agrarian institutionality of the country, the decentralization process that has taken place, the main public services related to soil and pasture management, and territorial zoning.

The primary target of these drafts was to have the necessary information to be able to prepare the first version of the surveys to be applied in each country, at local government level, considering their real state and particularities. They were also used as working material by the counterparts of the study, which obtained contributions for the elaboration of their final reports.

Notes:
1 - We make a basic distinction in public economy between the "provision units" that decide on taxation and public expenditure as from a certain prioritization of goods and public services, and the "production units", that decide on how to convert an "input" into product ("output").
2 - The three actors are: the mayor (municipal chairperson) and two representatives of local agricultural producer organizations. The report of the three information sources serves to triangulate the data as from three different perspectives.