Two people crossing a footbridge in Nepal
Photo by Vestal McIntyre

Research and Evidence for Nepal's Transition

Can decentralizing government power to local officials remedy long-standing political and economic inequities? The Research and Evidence for Nepal's Transition (RENT) program is building a practical evidence base on what works to enable more inclusive economic development.

People waiting in line to vote.
People waiting in line to vote. Photo from Wikimedia Commons.

After decades of civil war and political turmoil, Nepal ratified a new federal constitution in 2015. Elections in 2017 voted in more than 30,000 first-time politicians to newly empowered local offices. This political transformation offers an extraordinary opportunity to address poverty and give more Nepalis a greater stake in their country’s future – but federalism remains controversial, and the transition is challenging.

In collaboration with the UK’s Foreign, Commonwealth & Development Office, researchers at Inclusion Economics at Yale University, Governance Lab, and the London School of Economics are exploring how current policies and programs address Nepal’s long-standing political and economic inequities. The goal is to demonstrate how rigorous research can be relevant to meeting three primary policy goals in Nepal: a successful transition to federalism, broader economic transformation, and more inclusive economic development.

The project seeks answers to various questions, including: What policies and programs can best support positive change in a rapidly evolving political environment? What is enabling or constraining inclusive growth, state capacity, public services, private sector activity, civic engagement, and transparency and accountability? How can development partners use their limited resources to support political and economic inclusion? The project, currently in its implementation phase, aims to build a practical evidence base for Nepal and its supporters about what is working, what is not, and why. Key research outputs and findings for the project are cataloged under the following sections: highlights, inclusion and political representation, and local government capacity and policy priorities.

 

Highlights

Inclusion and Political Representation

While theoretical literature posits that elections create accountability and align leaders' and constituents' preferences, empirical evidence is mixed and suggests two critical constraints on electoral accountability in lower-income democracies. First, where citizen and politician preferences diverge, citizens often lack crucial information on politician performance, hindering their ability to utilize elections as an accountability mechanism. Second, party elites usually function as gatekeepers, restricting the pool of candidates citizens can choose from. This gatekeeping makes it harder for citizens to find candidates who align with their preferences, particularly for historically marginalized groups.

In this ongoing initiative, researchers at Inclusion Economics have collected extensive administrative and survey data on political aspirants, nominees, candidates, and representatives at the local level in Nepal. We seek to understand how modifications to electoral and party institutions influence political party candidate selections and the effect of political selection processes on the representation of historically excluded individuals.

Women holding their voter registration cards
Women holding their voter registration cards in Nepal. Photo from EPA.

Although the 2017 elections ushered thousands of women into local government for the first time, the 2022 elections generated substantial declines in representativeness along gender lines. Female political representation at the municipal level fell by almost 20 percentage points. Our ongoing work seeks to understand the barriers to inclusive representation in Nepal, particularly for women.

 

Local Government Capacity and Policy Priorities

Nepal's transition to federalism empowered new political actors with the potential to be responsive to the voters in their communities, but early evidence sheds light on substantial variation in local governments' legal, administrative, planning, and budgeting capacities. In the context of climate breakdown, a responsive local government with the ability to implement adaptation plans becomes even more critical.

In this ongoing initiative, researchers at Inclusion Economics have collected extensive administrative and survey data on the alignment between local politicians' and citizens' policy priorities, local government performance during the Covid-19 crises, and local implementation capacity in infrastructure planning, disaster response, and climate adaptation.

In theory, decentralized political systems can better represent the views and needs of local constituents because local governments have more information on citizen preferences relative to higher-tier governments. Geographic proximity may also help citizens better hold their representatives accountable. In practice, local politicians may need more information on voter preferences, or they may prioritize certain constituencies' needs over others. The Inclusion Economics research team seeks to combine insights from surveys of citizens and local politicians in order to understand how they rank policy priorities. 

Relative to federal and provincial representatives, citizens believe local officials are more attentive and increasingly responsive to their needs. Local officials' priorities also reflect objective indicators of community needs. For example, policymakers in remote areas prioritize roads, while those in low-literacy areas prioritize education. 

A man shares disposable gloves with protesters.
A man shares disposable gloves with protesters. Photo by Denis Dymov, Shutterstock.

The Covid-19 pandemic created an early test of the ability of Nepal's newly decentralized government to represent their constituents while also effectively taking action to contain the spread of the disease and mitigate the economic and social effects of the pandemic. Between June 2020 and December 2021, the Inclusion Economics research team conducted four rounds of phone surveys with local officials to understand their local response to the pandemic. 

In Nepal, federal Covid-19 relief funds were provided to local municipalities in adherence to the standard rules used to distribute relief funds for other disasters; rural areas subject to frequent flooding and earthquakes received more per capita as compared to urban areas, leaving them under-resourced for dealing with high caseloads.

As municipalities in Nepal build out infrastructure to transform local economics, they remain vulnerable to extreme weather and climate-induced disasters. To date, there is little existing evidence on how local politicians in developing countries use information on climate change risks to make policy decisions on climate adaptation. In 2022 and 2023, the Inclusion Economics research team conducted two rounds of phone surveys with local officials to understand how they implemented local infrastructure projects and how they perceived their own role in climate change policy.

About the Project

Principal Investigators:

Implementation Partners:

This research has received support from: