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Multi-level Governance

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Multi-level Governance: The issues

Relations across levels of government have changed over the last two decades. Decentralisation has made local and regional governments more powerful in formulating and delivering policy thereby increasing their scope for improving the competitiveness of the regional economy and the well-being of residents.

This change from a centralised and "vertical" system, has made governance more complex by involving a wider range of stakeholders at different levels. As a result bothhorizontal and vertical relationships are increasingly important. Understanding this complex network of relationships, as well as developing effective collaboration between levels of government, is critical to enable efficient policy making and service delivery.

Multilevel Governance at the OECD

OECD work on multi level governance addresses both vertical and horizontal dimensions.

The “vertical” dimension refers to the linkages between higher and lower levels of government, including their institutional, financial, and informational aspects. Local capacity building and incentives for effectiveness of sub-national levels of government are crucial issues for improving the quality and coherence of public policy.

The "horizontal" dimension refers to co-operation arrangements between regions or between municipalities. These agreements are increasingly common as a means by which to improve the effectiveness of local public service delivery and implementation of development strategies.

A multi-level governance framework has been formulated by the OECD and has been used in several areas of work related to multi-level governance including on cities and climate change, regulatory governance, sub-national finance and water governance.

Factsheet on Multi-level Governance

Cities and Climate Change

The governance of climate change requires involvement across all levels of government and relevant stakeholders to avoid policy gaps between local action plans and national policy frameworks (vertical) and to encourage cross-scale learning between relevant departments or institutions in local and regional governments (horizontal).

More about multilevel governance and climate change policies

Cities and Climate Change (2009)

Cities and Green Growth (2011)

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Water Governance

Water governance is one policy area in which effective multi-level governance is vital. Managing water is a complex issue involving multiple stakeholders from all levels of government with different views and objectives. A lack of effective management of interdependencies and coordination across these stakeholders can hamper the efficient design and implementation of water policy reform.

The publication Water Governance in OECD Countries: A multi-level approach identifies common governance gaps and is a tool for policy makers to carry out self-assessments and find commonalities with other regions.

More about water governance

Water Governance in OECD Countries: A multi-level approach (2011)

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Sub-national Finance

Well-designed multi-level governance structures in public finance can strongly improve the well-being of the population. They increase not only the efficiency with which needed revenues can be raised, but contribute also to ensure that public money is spent wisely and financial stability is maintained

Multi-level Regulatory Governance

High-quality regulation at a certain level of government can be compromised by poor regulatory policies and practices at other levels. This negatively affects business and citizens, and thereby the economy as a whole. Following certain principles and good practices for high quality regulation in a coherent way, as well as facilitating co-ordination among regulatory institutions at different levels of government can bring improvements to the regulatory system as a whole.

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