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Can someone provide sources and research for this claim?

Size of public sector would be measured by number of public workers per citizen or public expenditure per citizen.

There would seem that in fact it's what happens, but France is a centralized state and has more public workers per citizen than Spain, a decentralized state.

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  • By (most) definitions, a government is a bureaucracy. – user1530 Dec 10 '14 at 16:57
  • What do you mean by “bureaucracy”? – Relaxed Dec 10 '14 at 17:06
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    And as for France vs. Spain, they are simply very different models--the differences not necessarily being centralized vs. decentralized. (I guess the point is that it may be very hard to isolate that one variable for comparison). – user1530 Dec 10 '14 at 18:26
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    Most public sector workers are actually delivering some services so the raw numbers would seem to be a poor measure of bureaucratic overhead. To take one example, it seems that private (catholic?) schools are more common in Spain than in France. Depending on how teachers and other school employees are counted, it could account for most of the difference without revealing anything about efficiency or management. – Relaxed Dec 11 '14 at 2:38
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    @Tyler Catalonia would be a middle-sized state in the European context, it's hard to see how there would be anything new or exciting about it. Meanwhile, Monaco is so dependent on France that it's hardly a model of anything. For example, it can't offer any tax advantages to French citizens. It also forbids its own citizens from playing in its casinos. So, like most tax havens, its sustainability has nothing to do with efficiency or competition and everything to do with it being tiny and tolerated by its neighbours. It could not exist on its own or as part of world made of other Monacos. – Relaxed Dec 16 '14 at 14:35
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There are definitely scientific (political science) and policy papers out there.

In 1998, this article by the Inter-American Development Bank found that decentralized governments were typically larger. They propose two reasons:

1.) In a decentralized government, budgets are soft limits. A sub-national unit (state, city, etc.) can always ask to be bailed out by the national government. In this sense, a decentralized government has the ability to expand more than a centralized one.

2.) In a decentralized government, many agencies may tap the same common resources. A single, centralized government would use less of the resource because it can ration it's usage, but multiple agencies will probably not coordinate.

Several state legislative auditors in America, as well as the GAO routinely investigate service overlap.

On the academic side, results are mixed. Some research shows that decentralized governments are typically larger because of service overlap/duplication (many agencies providing the same service). Other research finds that decentralized governments are smaller because departments can specialize (the federal Department of Education doesn't have to worry about the details of schools in a particular state, because the state Dep. of Education handles tha).

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If you consider privatization as a decentralisation mechanism, there is a correlation. When a government decentralizes most of its functions, then the government in toto will be smaller one. Privatization is what the World Bank promotes as decentralisation. However, substantive decentralisation is devolution, deconcentration or delegation. In such cases, decentralisation may not bring down the number of officials or functionaries. Decentralization in such cases is a zero sum game where there is only a displacement of officials down the line in the governmental system.

Devolution is the real decentralization where the powers are transferred to the governments closer to the people but in deconcentraton the powers still remain with the central government. In delegation also, the powers are only delegated, but the real authority rest with the sovereign government.

Here what I mean as decentralisation is devolution of political, administrative and financial powers to the lower tiers of government and bringing them closer to the citizens so that they will have a better say.

I am sorry that I cannot give any reference source for your question right now. But for what I have said, the Source Book on Decentralisation is the reference source.

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