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What Are the Areas of Competence for Central and Local Governments? Accountability Mechanisms in Multi-Level Governance

This study aims to advance understanding of the distinctive areas of competence for central and local governments. In doing so, we focus on the relative impacts of two accountability mechanisms — elections and management approaches — on the bureaucratic attitudes and behaviors exhibited within central and local governments. We posit that elections have dominant impacts in local governments, whereas management systems play a relatively larger role in the central government. Due to this difference, the central government may be better placed than local governments to administer those public service activities that either have outputs unobservable to the citizenry or require a lead time that is longer than the time between elections. This study investigates this argument empirically by taking advantage of a unique quasi-experiment in South Korea in which responsibility for administration of local water supply services changed from local governments to a central government agency. Investigating seven years’ worth of quarterly data, we find that following the change in governance, citizen satisfaction deteriorated but efficiency improved.