Decentralization and trust: institutional design for effective governance

Abstract This study examines the relationship between decentralization and public trust in the civil service using a multidimensional framework that extends beyond conventional fiscal measures. Drawing on indicators of regional and local government autonomy across 47 countries from 1995 to 2018, the analysis yields four findings. Trust is higher when local governments, rather than regional authorities, lead service delivery; greater subnational financial self-reliance is positively associated with trust; oversight by higher tiers enhances accountability and citizen perceptions; and shared-rule arrangements that involve regional governments in national decision-making further bolster trust. Overall, the findings highlight the limits of fiscal decentralization alone and underscore the importance of institutional design and balanced decentralization reforms in fostering public trust.