Nowadays, global economy has to face some difficulties, especially since the financial crisis is still a present factor in our economy. This research paper emphasizes the importance of adopting, especially during instability periods, coherent measures by all those who have the power of decision in terms of local budgetary revenue collection and expenditure destination. It is necessary that the regional development dimensions to be conceived according to the diversity of nations, their historical background, but also the cultural, economic and social development discrepancies. We have also underlined the connection between regional development, local autonomy and decentralization, mainly the administrative decentralization, as these concepts define the transfer of responsibilities for the planning, financing and management of certain public functions from the central Government to subordinate units or regional and local authorities. The article focuses on the Global Index of Development and its specific indicators which reveal region’s social-economic and financial performance.
The dissertation examines the political challenges of public utility reform through the analysis of urban water and sanitation services in Mexico. Decentralization of services to municipal governments was coupled with promotion of "market-based" policies in the 1980s and 1990s. However, the unpopularity of these policies provided political obstacles for mayors now charged with reforming the sector because many consumers were not accustomed to paying for water services. These policies--increased water prices, rigorous fee collection practices, and service suspension for non-payment--were political costs felt in the short-term, whereas the benefits of reform were long-term service improvements in water quality and quantity, reduced environmental pollution, and increased economic and social development. This problem of time inconsistency is a challenge even for pro-reform mayors because mayors in Mexico have a narrow window of time within which to enact policy. Mayoral administrations are three years long with no immediate re-election, and bureaucratic administrators follow the electoral cycle, which further exacerbates the challenge of long-term policymaking.Based on a comparative analysis of nine Mexican municipalities, I argue that mayors whose constituent base is primarily composed of middle and upper income consumers and business are more likely to reform because these groups are more able to pay short-term costs for long-term service improvements than the urban poor. With the support of a pro-reform mayor, reform is likely under two conditions: a) the presence of a water intensive industry and b) institutional support from the state government. Water intensive industry prioritizes improvement in service delivery, calculates costs based on the long run, and, further, has long-term financial and professional ties in the community. Water intensive industry is well positioned to support the policy process over time by participating in the leadership of the water utility board of directors. Also, water intensive industry can help offset the costs of reform because it pays more per cubic meter through a block tariff pricing scheme, a policy that subsidizes domestic consumers and helps to finance the reform agenda. Therefore, water intensive industry can lengthen the political problems of imposing costs in the short-term for mayors, lowering the costs to consumers before the long-term benefits of service improvements appear. Finally, state governments can provide legal, fiscal and technical resources that can help shorten the learning curve of incoming mayoral administrations. As such, state government can shorten the long-term planning of the reform process to make it more consistent with the shorter electoral cycle found at the municipal level. This research advances debates on policy adoption and implementation, highlighting the importance of political-business coalitional support as well as the role of inter-tier relations in maintaining policies over time.
INTRODUCTION The expectation is that in the next two decades, China and India will turn into super-powers and industrialized nations. The analysis in this paper will help in understanding how each country's corporate setup works and will help in evaluating the investment potential in the buying of stocks of firms of each country in their various industry sectors. This study contains a literature review followed by the results of the study. The study utilizes a three step top to bottom analysis; macroeconomic analysis followed by industry analysis and lastly with company analysis. The various tables and figures are attached to the end of the article. LITERATURE REVIEW Hu and Honghua (2002) compare key measures of strengths between China and India. These measures include GDP, ratio of long-term economic growth expectation in the world's total, average years of education, and the ratio of exported goods and services in the world's total. The authors conclude that China is far ahead of India. Husain and Harris (2009) compare and contrast broader aspects of the political, economic, and sociocultural climates within the two countries. Kalish (2007) and Zhao (2007) draw similar conclusions based on detailed comparisons and the risks and opportunities of doing business in each country. Wu (2007) compares the service sector growth in China and India and analyzes the determinants of growth in services with an econometric model. He finds that role of services in both China and India has been rising, with China starting from a lower base. Srinivasan's (2004) exhaustive study on comparison of economic performance between China and India identifies key differences and similarities, the underlying causes of success and failures and concludes that China and India have a lot to gain, both from trading with each other and cooperating in the WTO. Maddison (2002) reveals that although India forged ahead of China until the outbreak of the First World War, since 1980, China has forged much farther ahead. Rwaski (2001), Srinivasan and Bardhan (1974), Deato and Kozel (2003), Park and Wang (2001) discuss the sources of estimates of economic performance in China and India, and their frailties. Bahl and Martinez-Vazquez (2003) argue that China's governance is much decentralized than indicated by the government and therefore, it is hard to predict the effect of greater decentralization on China's future fiscal health. Battacharya and Patel (2002) note that the Indian economy suffers from a large and increasing role of the government. Bosworth and Collins (2007) point out the weak and strong performances of India and China in various sectors and conclude that both economies should be able to sustain their growth. While a wealth of literature exists on evaluation of these two countries from a macroeconomic perspective, there exists a gap in the finance literature, specifically, a perspective for potential investors in trying to determine where to place their investment funds. In this article, we examine the valuation issues that an investor needs to consider when investing in china and India. By and large the finance literature advocates a three-step (also known as top-down) valuation process. The first step includes evaluation of general macro-economic factors which influence a country's economy. These factors include fiscal and monetary policy of countries, political conditions. The second step involves identification and assessments of an industry environment in a country's economy. It includes labor skills and relations, capital-labor and business cycle-industry inter-relationships, demographics, scope of the industry and its competitive environment to gauge business risk. The final steps comprise of individual firm analysis in an industry. We use this three-step framework to evaluate and compare the valuation environment in China and India. THE ECONOMIES We deploy Goldman Sachs version of the three-step process, which includes examination of GDP as the key component of a country's economy. …
The political transformation in Poland led to the decentralization of many activities from the state level to that of democratically elected governments at regional and local levels. Since 1999 each of the newly established regions has to formulate and implement policies in numerous fields, including culture and heritage. The cultural policies that they have pursued are influenced not only by structures inherited from socialist times, regional artistic traditions, perceived development needs and aspirations but also by the ability of particular regions to seize the opportunities provided by them (for example by the European Union funds) and by approaching culture as an important factor in economic and social development. Using the example of the Małopolska region, the author examines the regional cultural policy as evident in strategic documents, the financing of cultural institutions, programmes and projects on the regional level.
The paper puts forward the theory of fiscal decentralization and the superiority of the basic point of view by illustrating the theoretical development of the financial decentralization of the sort sequence. China's financial system is at a critical stage of reform and development. Between central and local governments into financial terms and the exercise of reasonable design of the system still exist,issues such as lack of incentive mechanism. The West by studying the theory of fiscal decentralization at all levels of government will help improve the financial efficiency and effectiveness of behavior,and promote national economic and social development.
What political factors influence the allocation of economic patronage in democracies? Answering this question is vital to improving our knowledge of how states and markets interact. In this paper, I argue that changing levels of party centralization can drive important changes in the allocation of state largess. When governing parties are centralized, national party leaders will control sources of patronage, targeting benefits to particularly influential regions and industries. By contrast, when governing parties are decentralized, influential sub-national party leaders will advocate for their constituents, allocating patronage evenly through a national logroll. I find evidence for these relationships by comparing India's distribution process for industrial licenses and government finance under a decentralized Congress Party (1954-61) to its distribution process under a centralized Congress Party (1969-75).
Preface E.Friedman Introduction R.MacFarquhar Two Paths to Modernity B.Gilley ECONOMIC REFORMS Differential Development: Beyond Regime Dichotomies J.Mukherji Chasing China: Can India Bridge the Gap? S.Awamy India's Reform Strengths J.Manor & G.Segal SUB-NATIONAL FACTORS The Persistence of Informal Finance K.Tsai The Political Basis of Decentralization A.Sinha Indigenous vs. Foreign Business Models H.Yasheng & T.Khanna NEW PERSPECTIVES Why Democracy Matters E.Friedman China Rethinks India H.Jinxin Development and Choice A.Saich Conclusion B.Gilley
The Paper traces the evaluation of agricultural credit in India. The first attempt at institutional changes in agriculture saw the establishment of special funds under the RBI and formation of co-operative credit societies. Then came nationalisation of commercial banks and concepts of priority sector lending. Targeted lending along with subsidized interest rate charged by the NABARD characterised this phase. Institutional framework undergoes a dramatic change since the nineties when decentralization occupies the centre stage. Micro credit societies and SHG-bank tie up assume the role of feeder canals of finance in agriculture.
Many people think changes are always good. However, sometimes it is not so. Before making a change, one must ask what kind of change is it and how it will affect status quo. This paper tries to show how an institutional change that has been wrongly conceived could lead to a worse situation. The Venezuelan experience studied here is a ?show-window? of contradictory decentralization process, in which sub-national governments lack the faculties to generate their own income, and moreover, in which oil income continues to be almost the only source of governmental financing.
Decentralization of social services is one of the central elements of the social policy reforms being carried out in Latin America in order to make the provision of such services more efficient and to strengthen the democratization processes. This article analyses the processes of decentralization of education in seven Latin American countries (Argentina, Bolivia, Brazil, Chile, Colombia, Mexico and Nicaragua). It seeks to systematize these experiences, using a theoretical typology of reform models; to present some results and trends in terms of the efficiency and equity of the provision of these services, and to extract some useful lessons for the design of future reforms. Although the models developed in the various countries differ from each other, they nevertheless have some common features: they depend on the resources provided by the central level to finance the services, and in many cases they subordinate schools to decisions taken at other levels. Among the main economic and social effects of the reforms are the limited progress made in participation and, hence, social efficiency; the ambiguous results obtained in terms of technical efficiency, and a trend which is not yet fully confirmed towards greater inter-territorial disparities in educational indicators. Among the lessons for policy formulation is the importance of giving the new levels of supply some degree of real autonomy, using a system of transfers which encourages a quest for efficiency while at the same time safeguarding equity, taking care to preserve the internal coherence of the models, giving some responsibilities directly to the schools, and ensuring that there is a suitable framework for the regulation and supervision of decentralized service supply systems.
Intergovernmental fiscal relations play a fundamental role in the economic and social development of Vietnam. As in all unitary forms of government, the central government sets national policies and assists with the financing of the activities of subnational administrative units, as well as undertaking certain expenditure responsibilities directly. On the other hand, decentralization facilitates implementation of policies that reflect the preferences of inhabitants of subnational administrative units. An important objective, therefore, is to design a system that reconciles the sometimes conflicting objectives of centralization and decentralization. This report is intended to assist the government of Vietnam in designing its system of intergovernmental fiscal relations (IFR).The next section describes the political system within which intergovernmental fiscal relations are imbedded. The third section provides an overview of intergovernmental fiscal relations in Vietnam. Section IV describes the assignment of expenditure responsibilities among levels of government, Section V discusses fiscal management and budgeting, and Section VI describes and appraises the revenue side of intergovernmental fiscal relations. These sections contain descriptions of current practice, a brief statement of criteria against which they are to be appraised, an appraisal of current practice, and recommendations for improvements. Section VII describes how the present system of subventions could be replaced by an improved system of intergovernmental transfers. This discussion focuses primarily on relations between the central government and the provinces; relations between provinces and districts and between districts and communes are generally quite similar.Working Paper Number 98-02.
This article describes and evaluates the financing aspects of the social sectors decentralization process in Chile. The article reviews the analytics of the optimal financial mix of decentralized social services; assesses the municipal income distribution
T HE PROLIFERATION OF INTEREST GROUPS and the explosion of group advocacy in the United States and other liberal democracies in the 1980s has led to a renewed attention to the comparative study of interest politics. Among the major questions at issue is the relationship between political, social and economic change and group formation, proliferation, organizational maintenance and group action. Interest group theory suggests that groups proliferate during periods of rapid change. As India approaches its first half century of independence, a study of changes in its interest group system provides an excellent opportunity to attempt to assess the impact of systemic change on interest group development and behavior.' In the decades since independence and especially since 1980, India has experienced an accelerated process of economic, social and political change. The Indian rate of economic growth has increased, literacy rates have risen sharply, the pace of urbanization has quickened and most importantly the size of its middle class has increased significantly. These economic and social changes have been accompanied by striking political and policy changes that include the decline of party, heightened pressure for decentralization and fundamental alteration of India's past model of planned development. These changes have begun to alter the nature and conduct of interest politics in India. India has experienced an increase in the mobilization, proliferation and transformation of groups and significant changes in interest group roles, styles and strategies. As a result the Indian system of state-dominated pluralism in which autonomous groups were overshadowed by an omnipresent state2 is eroding as interest politics have
China's thirteen years of economic reforms (1979-1991) have achieved an average GNP annual growth rate of 8.6%.What makes China's reforms differ from those of Eastern Europe and the Soviet Union is the sustained entry and expansion of the non-state sector.We argue that the organization structure of the economy matters.Unlike their unitary hierarchical structure based on functional or specialization principles (the Uform), China's hierarchical economy has been the multi-layer-multi-regional one mainly based on territorial principle (the deep M-form, or briefly, the M-form).Reforms have further decentralized the M-form economy along regional lines, which provided flexibility and opportunities for carrying out regional experiments, for the rise of nonstate enterprises, and for the emergence of markets.This is why China's non-state sector share of industrial output increased from 22% in 1978 to 47% in 1991 and its private sector's share from zero to about 10%, both being achieved without mass privatization and changes in the political system.2 Data sources in this paper are from Statistical Yearbook of China (various issues from 1985 to 1992), otherwise noted.3 Statistical Communique of the State Statistical Bureau on the 1992 National Economic and Social Development, February 18, 1992. 4 The export-GNP ratios are calculated based on the official exchange rate and are upward biased.But the dramatic increase of export share in GNP during the reform is unmistaken. 2 both before and after their radical transformations in 1989.It appears that China had no coherent reform programs, no commitment to private ownership, and no changes in the political system, and China's economy was still not fully liberalized.From both the theoretical and policy perspectives, China's different reform strategies and outstanding reform performances are particularly interesting and puzzling.The economic reforms in China formally started in 1979 following the Third Plenum of the Eleventh Congress of the Chinese Communist Party in December 1978.The starting time was later than that of Yugoslavia (1950) and Hungary ( 1968) and was about the same as for Poland (1980), and earlier than the Soviet Union (1986).Between 1979 and 1991, China's GNP grew at an average annual rate of 8.6%, or at 7.2% on the per capita basis. 2 In 1992, the growth of GNP reached 12.8%. 3Exports grew at a faster pace, so that China's export-GNP ratio increased from below 5% in 1978 to nearly 20% in 1991. 4 Also in this period, inflation was kept within a single-digit range except for three years (11.9% in 1985, 20.7% in 1988 and 16.3% in 1989); the household bank deposits to GNP ratio increased from 6% in 1978 to 46% in 1991; and the government budget deficit accounted for about 2-3% of GNP, about half of which was financed from bond issues (Table 1.1).Even more convincing evidence of the success of the reform is the increase in consumption and consumer durable goods by an average Chinese consumer in physical terms.For example, between 1978 and 1991, an average Chinese consumer increased his/her consumption about three times for edible vegetable oil, pork, and eggs (Table 1.2).In the rural areas, which account for about 75% of total population, the living space per person increased about 130% between 1978 and 1991 (Table 1.3).The 5 Data source for Hungary and Poland is from Table 9.1 of Kornai (1992).6 For example, Summers (1992) expressed this view when he highly praised China's reform performance.Sachs (1992) also expressed similar ideas during his interview with the Chinese Journal of Comparative Economic and Social Systems.
Participatory development activities at local level in a sub-district located in the Central Plain of Thailand were studied employing the theoretical concept of the "linking loops" to analyze the related interactions among target group members and between the local level and superordinated organizations.The participatory development planning approach was first introduced in Thailand through her Fourth National Economic and Social Development Plan (1977-1981) as a strategy to apply the bottom-up concept.The qualitative, in-depth study covers nine projects at different stages of the planned development process alternatively covering the stages of initiation, implementation and completion. Despite the variety of projects involving different groups of the local population within the three case study villages in close vicinity, all these are set in the same socio-cultural context which allows direct comparison.Drawing on selected theoretical sociological explanations of the dimensions and determinants of people's participation, the conceptual and analytical framework is focussed on an actor-oriented approach using the theoretical concept of the "linking loops" to explicate the complex dynamics evolving in Thai rural society when engaged in local-level planning.By their mechanism of initiation, as explained in terms of the "linking loops" concept, three categories of projects are distinguished including village initiated projects (VIP) and government initiated projects (GIP) as well as projects initiated by villagers with a view to securing government support (V/GP). The comparison of hypothesis test results by project category leads to their classification as explanations of narrow range pertaining to one project category only, of medium range covering two out of the three categories, or of wide range rendering explanations valid for all three project categories.Six general hypotheses and their sub-hypotheses addressing as many stages of the project cycle are tested. The results of hypothesis testing vary by project category as summarized hereunder.VIP were effective owing to people's involvement in setting the project objectives, despite differences and conflicts; utilization of local knowledge in data collection and analysis; broad formal consensus on project design; active involvement in project approval; active involvement in implementation; and involvement in project evaluation through participatory monitoring and evaluation.V/GP differ substantially because the test results show that local-level projects initiated by villagers and obtaining resources from on-going government programmes were of limited effectiveness. The constraints include lack of people's involvement in the formulation of objectives, thus reinforcing dissent and conflict; differences in perception between local people and government agents with regard to data collection and analysis; lack of people's involvement and formal consensus on project design; lack of local interest in project approval due to complicated procedure followed by several government organizations involved; lack of people's participation in on- going project implementation due to changed circumstances and reassessment of the erstwhile situation; and lack of involvement in project evaluation, in the absence of participatory monitoring and evaluation.GIP implemented at local-level were found ineffective as a consequence of lack of local people's involvement in the specification of objectives and formulation of projects, aggravated by conflicting priorities among local people; differences in perception between local people and government agents regarding data collection and analysis; limited extent of people's participation in designing activities and weak consensus; lack of interest among local people not involved in project approval; discontinuation of people's participation in on-going implementation due to new perception after reassessment of the erstwhile situation, poor organizational set-up by the implementing agency, disagreement between local people and government agent, and conflict among local people; and lack of people's involvement in project evaluation, in the absence of participatory monitoring and evaluation.Overall, it is concluded that local-level plans are, indeed, of interest to local people. They tend to become ineffective, however, at any of the various stages of the planned development process, if people's participation is lacking in the formulation of project objectives, complicated by differing and conflicting objectives among local people; if differences in perception prevail between local people and government agents with regard to data collection and analysis; if deficiencies in project design are aggravated by the exclusion of local people from endorsing projects and procedure is complicated engaging several government organizations at the approval stage; if discontinuation of people's participation jeopardizes on-going implementation; and if project performance and outcome are assessed without participatory monitoring and evaluation.Recognizing certain existing deficiencies with a view to people's participation in the planned development process of local-level projects, policy recommendations are made focussing on suitability, design and intervention, taking into account local socio-economic, cultural and political factors. Moreover, the necessity of decentralization is stressed so as to strengthen people's participation in the planned development process. This means that wholesome delegation of responsibility in terms of decision-making power and budget allocation as well as finance control to the local level of development administration is essential to facilitate and foster participatory planning.
In the lapse of the last twenty-five years, municipal development institutions have be- come common components in the governmental structure of many Latin American nations. Municipal development institutions function inBrazil, Venezuela, the Dominican Republic, Guatemala, Costa Rica, Paraguay, Bolivia, Honduras, and Peru (Gall, 1976: 28,30).Generally these institutions are charged with financing the construction of urban infra- structure through loans to municipalities and in some cases to other community groups or governmental agencies.A secondary emphasis is normally given to promoting municipal autonomy and the training of municipal em- ployees through a combination of direct tech- nical assistance to specific municipalities and indirect technical assistance to a wide range of municipal governments through the preparation of manuals or guides and short train- ing courses.Bolivia's municipal development institution, the Servicio Nacional de Desarrollo Urbano (SENDLn, was legally established in 1972 as a decentralized and semi-autonomous agency
1. Like many other countries, Portugal is facing numerous major problems related to regional unbalance and consequently to the location of economic activity. An unfortunate tendency has long been to judge an economy almost solely from the viewpoint of national production and consumption aggregats, without reference to the geographic division of economic activity.However the questions of social justice in the distributions of the fruits of economic development are as important and as different in terms of regions as in terms of social classes.Thus, at the present, increasingly attention is not being limited to the overall results of national development; the results are being accepted as satisfactory only if they concern the whole of the country, if each region is able to contribute to and participate in the national growth..On the other hand, Government activity to guide economic and social development involves not only the activity of policies and programmes but also the losely related process of formulation of goals and means and of appraisal of the results.If planning for regional development is intended to intervene realistically upon reality, it should be a continuous process in which the various units and levels of government subject the entire process to continuous review and evaluation leading to adjustment of plans, programmes and projects whenever necessary. Review and evaluation then form the transition to a new cycle of planning and decision making, moving ahead in time on the basis of a continuous stream of feedback information. At the same time, the fact is stressed that planning is actually a combination of plan formulation and plan inplementation.Institutional framework, in the modern sense of the process of achieving intended results through organizations, is a major factor at all levels - national, regional, sectoral and local. There was a time when proposals for new development pro. jects - particularly large programmes for resource development, new industries, improved education and health services - were considered only in terms of economic and technical feasibility.. After many unfortunate failures, institutional feasibility has come to be recognized as also an important dimension of planning.For evaluating the evolution of the objectives and means which have characterized Portuguese regional planning I rely in large measure on a general policy model formulated in the light of relevant theoretical and empirical considerations from economics and related social science disciplineOne of the basic attributes of this model is its distinction among three types of analytic regions: congested, potential, and backward. The advantaSe of these distinctions over the common division between "developed" and "underdeveloped" regions is that they come to grips directly with the problem of overconcentration of population and economic activity in some areas, a problem too often neglected in favour of studying the difficulties experienced by relatively underdeveloped regions.The circumstances which have given rise to the evolution of' Portuguese regional policy are compared with the assumptions of this basic model. Attention is given to the basic theoretical notions that have animated Portuguese thought concerning regional development and urban-rural integration, as well as to concrete measures which have been undertaken or which are envisaged for the future.On the basis of these considerations an effort is made to formulate a number of generalizations regarding the potential strenghts and difficulties of regional planning policy-making and a number of operationally feasible proposale are set forth for dealing with the difficulties.2. Portuguese regional planning was initiated on the basis of a deliberated attempt to deal rationally with spatial resource allocation, namely through the policy of "ordenamento do território".In the terminology of the Third Plan, the Portuguese approach maintains that the policy of "ordenamento do território" must find a practical compromise between regions depending on a policy of publicly induced growth and regions depending on a policy of induced public investment. On the one hand, it must give every opportunity, under conditions of lively competition, to strong regions whose potential benefits the whole of the country. On the other hand, it must seek to involve the weak regions in a process of development at first induced, then autonomous, in a manner which will enable them to participate in the current of modernization and expansion which characterizes our time.I try to show that the difficulties of Portuguese's backward regions are in large measure a result of a relative lack of benefits deriving from social investment. This is not to deny that economic investment in backward regions will produce advantages, but the effectiveness of such projects also depends on the degree to which the regions' human resources have been developed by social investment.Therefore, I stress that while there is official recognition of the needs to provide facilities for training surplus agricultural labor for employment in industry, there has not been adequate emphasis on the general problem of developing the human resources of these areas, despite the multitude of evidence concerning pronounced needs in this regard..On the other hand, a great deal has been said and written about moving industry and other economic activities to people, but policy-makers generally are more reluctant to urge the movement of people to job sources. Until now official Portuguese policy has been unable to oppose and to diminish the growth of a surprising number of rural individually-owned farms in the face of rapid technological change. This attitude, combined with inadequate social investment, has served to perpetuate the social and economic structures characteristic of backward agricultural regions of the center and the north including a surplus agricultural labor force.One of the principal arguments in favour of moving industry to backward regions, even at considerable expense in theform of subsidies or similar means, has been that the social costs involved in this type of action are less than the social costswhich would entail the uprooting of persons seeking employment in other regions as well as the increased congestion which would result in industrial agglomerations, However, the latter difficulty is now a necessary one, since migration can be channeled to intermediate or potential, rather than congested regions.On the other hand, the issue of uprooting residents of backward areas is a genuine problem since there is abundant evidence that the number of persons preferring to live in these regions is high in both absolute and relative terms.. Moreover, migration is not feasible for many persons because deficiencies in social investment in backward regions have limited the development of human resources and thus the possibility for their employment in other regions. Nevertheless, these arguments should not be used to discourage migration, since at the margin there are always persons ready and willing to migrate from backward regions.In general, it may be said that Portuguese regional policy has been facilitated by its distinction among three types of region, and that its over-all division of effort among the regions so as to induce growth in backward regions while limiting the growth of the Lisbon region and allowing for the expansion of potential regions has been substantially correct. Investment policywithin regions, however, must place relatively greater stress on social investment for backward regions. As to population policy, the new emphasis on encouraging interregional labor migration is a positive step away from the more conservative attitudes which prevailed heretofore.3. In any event, it is obvious that the value of the Portuguese regional development policy is related to the actual context in which it is to be applied. In this respect, the creation of regional organisms to participate in the formulation of regional priorities and in the regionalization of the government budget are of particular value in the elaboration of political ends and means.Unfortunately, earlier efforts in this direction were characterized by important defects. The prograps for regional action which were drawn up as planning guidelines for the various planning regions generally have been plans in name only. They have been for the most part inventories of regional conditions at a giventime. In addition, they have been deficient intipulating orders of priority and modes of finance for suggested future projects.Nevertheless, these programs have served to confront the Regional Planning Commissions with the need for horizontal consultation and coordination in regional terms as a complement to vertical planning by sectors; they have marked an initial, if not always successful, attempt to encourage cooperation among ministries and departments on common problems..Thus, in order to satisfy the objectives of regional development foregoing discussed, the need for reform of the structures - or at least changes in the institutional apparatus - become increasingly necessary. To avoid "sprinkling" of public funds it is not enough just to introduce new methods into the organizational bodies concerned; it becomes clear that something has to be done about the decision-making structures themselves. Two complementary requirements become apparent among others:- firstly, greater decentralization of decisions within the institutional apparatus and greater participation of people.- secondly, horizontal co-ordination in order to break up the vertical compartmentalizations and to create in that way the conditions for a better synthesis capable of inspiring better decisions.Just now, a new development Plan for Portugal is in preparation covering the period 1974-1979, Considering the methods of planning which have been employed in the country, one could