ABSTRACT
This chapter summarizes the rationale underlying decentralized administration and the role local governments in developing countries can play in decentralization. It provides background information on the political and economic environment in which the local governments of Bangladesh operate. One type of efficiency associated with decentralization is economic efficiency. One potential benefit of decentralization concerns its effect on local mobilization of resources, both monetary and labor. Greater decentralization of administrative power was pronounced as a policy goal in Bangladesh. The public sector has historically played a dominant role in Bangladesh. The government intervenes greatly in both the agricultural and industrial sectors although there have been some efforts made to decrease this intervention. The economy of Bangladesh is heavily dependent on imports of both producer and consumer goods; hence the worldwide increases in prices led to increased costs of domestic production and slowed the growth of the economy. The chapter also presents an overview of the key concepts discussed in this book.
