A Natural Experiment in Political

Decentralization: Local Institutions and

Citizens’ Political Engagement in Uruguay
Fernando Rosenblatt
Germán Bidegain
Felipe Monestier
Rafael Piñeiro Rodríguez

ABSTRACT

The potential democratizing effect of political decentralization reforms has

been a matter of substantial theoretical and empirical debate. This article ana-
lyzes the effect of local democratic institution building on the political attitudes
and behavior of citizens living in small towns in Uruguay. More specifically,
using a natural experiment design, this research seeks to establish the causal
impact of recently established elections of local authorities on individuals’ polit-
ical engagement. It develops a comparative case study analyzing the conse-
quences of this institutional innovation in two towns. It shows that individuals
from the town where citizens have the opportunity to elect their local authori-
ties have more positive attitudes toward politics than those from the town with-
out such elections.

H ow does the creation of democratic institutions at the local level affect citizens’
political attitudes and behavior? The potential consequences of political
decentralization reforms have been a subject of substantial consideration in political
science. This study takes advantage of a natural experiment research design to iden-
tify how creating local representative democratic institutions affects the behavior
and attitudes of citizens living in previously disregarded small towns. It thereby aims
to contribute to the debate about the actual impact of political decentralization
reforms on consolidated democracies in developing and unequal countries with
strong state institutions. More specifically, it assesses how these types of reforms
affect the relationship between institution building and citizens’ political engage-

Fernando Rosenblatt is an assistant professor in the Escuela de Ciencia Política, Universidad

Diego Portales. fernandorosenblatt@gmail.com. Germán Bidegain is a Ph.D. candidate in
the Instituto de Ciencia Política, Pontificia Universidad Católica, Chile. gbidegai@uc.cl.
Felipe Monestier is an assistant professor in the Instituto de Ciencia Política, Universidad de
la República, Uruguay and PUC, Chile and a Ph.D. candidate in the Instituto de Ciencia
Política, PUC, Chile. famonestier@uc.cl. Rafael Piñeiro Rodríguez is an assistant professor in
the Departamento de Ciencias Sociales y Políticas, Universidad Católica del Uruguay.
rafael.pineiro@ucu.edu.uy.

© 2015 University of Miami

DOI: 10.1111/j.1548-2456.2015.00268.x
92 LATIN AMERICAN POLITICS AND SOCIETY 57: 2

ment. Its findings thereby contribute to assessing the potential democratizing effects
of political decentralization reforms.
Analyses of the causal impact of decentralization reforms have reached very dis-
similar conclusions (Eaton and Connerley 2010), and they have been strongly
marked by normative preferences. After initial excitement about the potential ben-
efits of decentralization reforms, scholars have become more neutral about their
results (Grindle 2007, 6). On the one hand, the literature has now become more
aware that under the umbrella of decentralization, a wide array of different types of
reforms exists. On the other hand, it has also noticed that similar reforms have dif-
ferent impacts in different contexts, leading scholars to question whether they have
the same impact in developing countries as they do in developed ones (Treisman
2007; Falleti 2010). Any analysis of decentralization reforms must therefore take
into consideration both the specific model implemented and the context in which
it has been applied. In this article, we analyze the effect of a specific political decen-
tralization reform, the enactment of local authorities’ election at the town level, in
a stable and consolidated democracy in Latin America, Uruguay.
In 2009, Uruguay implemented a political decentralization reform creating
municipalities (municipios) across the country. Each municipality is composed of a
mayor and four councilors. The law established that in every departamento, towns
of more than five thousand inhabitants would elect these municipal authorities,
while smaller towns would not.1 However, the reform also required each of the 19
departamentos to have at least 2 towns with elected mayor and councilors, even
where only one city met the minimum population threshold. In those depart-
ments, the second-largest town, regardless of absolute size, was also covered by the
reform.
While large cities differ from small cities in ways that matter for political atti-
tudes and participation, near the legal cutoff point of five thousand inhabitants,
assignment to municipalities may be as good as random. We therefore studied two
small towns of similar size, one subject to this significant local decentralization
reform and the other not. Using these two cases, we tested for the existence of a
causal relationship between the local-level institutional innovation of electing local
authorities and changes in individuals’ political attitudes and behavior.
The very strength of the natural experiment research design lies in its internal
validity. It thereby provides a great opportunity to evaluate causal arguments like
this one. Moreover, based on Dunning’s (2012) extensive literature review of natu-
ral experiment research, we believe ours to be the first study to analyze the impact
of political decentralization using this research design.
The study is based on the comparison of two geographically, economically,
politically, demographically, and culturally very similar towns, Casupá and Fray
Marcos. Under the provisions of the 2009 reform establishing the municipality (a
mayor and four local councilors), Casupá (population 2,668) gained the right to
elect local authorities while Fray Marcos (population 2,509) did not. The as-if-
random assignment of the treatment (Casupá) and control unit (Fray Marcos)
allows for a natural experiment research design to assess the impact on citizens’
 ROSENBLATT ET AL.: URUGUAY DECENTRALIZATION 93

political attitudes and behavior of a specific political decentralization reform: the

election of local political authorities (the treatment).
This article first presents a literature review and our theoretical argument. It
then discusses methodological considerations related to the comparative case study
and natural experiment research design nature of our study. The data and results are
discussed and the findings are then analyzed.

LITERATURE REVIEW
For many decades, policymakers, international financial institutions, politicians,
and scholars have widely promoted decentralization (Eaton 2004b). It was believed
that by adding layers of participation, democratic quality would be improved
(Campbell 2003; Diamond and Tsalik 1999). At the policy level, concomitantly,
decentralization was conceived as a way to overcome unresolved, growing tensions
among classical models of representative democracy. Thus, for those who promoted
these reforms, local-level democracy could increase support from below for democ-
racy at the national level.
The allegedly positive impact of these reforms on democratic consolidation was
not the only effect attributed to decentralization. Decentralization was also expected
to improve fiscal and administrative management, thereby allowing for more effec-
tive allocation of public goods. Diverse models of decentralization have been imple-
mented around the world, with different coverage (Manor 1999). The widespread
application of this kind of reform even motivated some authors to talk about a
“decentralization revolution” (Grindle 2007).
In recent years, social scientists have produced many rich empirical and theo-
retical analyses assessing decentralization reforms’ causes and consequences. Some
literature refers to the politics of decentralization (Willis et al. 1999; O’Neill 2003;
Wampler 2007); for example, analyzing the effects of different sequences of types of
decentralization implemented in a given country (Eaton 2004a; Falleti 2005, 2010).
Given the wide variety of models of decentralization, evaluations have involved
topics as diverse as the impact on government efficiency or local development (e.g.,
Johnson 2001), party systems (Harbers 2010; Sabatini 2003; Morgan 2011), and
citizens’ democratic attitudes and beliefs (Meguid 2007; Hiskey and Seligson 2003;
Connerley et al. 2010).
Our research seeks to contribute to understanding this last topic. As we argue,
decentralization reform was first and foremost conceived as a way to advance dem-
ocratic consolidation (Grindle 2007). Along these lines, authors such as Fox (1994)
have argued that decentralization contributes to the rupture of authoritarian
enclaves. Goldfrank (2006, 2011) provides an interesting comparative account of
different experiences with local-level participation and identifies conditions increas-
ing the probability that a decentralization mechanism will produce healthy effects.
After an initial wave of optimism, the literature that studied the impact of
decentralization on democratic consolidation in Latin America has more recently
recognized that decentralization comes in many forms. It is also applied in very dif-
94 LATIN AMERICAN POLITICS AND SOCIETY 57: 2

ferent contexts, thus leading to very dissimilar results (Rodden 2004; Montero and
Samuels 2004; Goldfrank 2006; Eaton 2006; Bardhan and Mookherjee 2006;
Meguid 2007; Treisman 2007; Falleti 2010). Schönleitner (2006) and Greaves
(2004) highlight some conditions under which local-level mechanisms may
adversely affect democratic quality. In another study, Ryan (2004) explores decen-
tralization’s potential for increasing clientelism.
In Latin America, scholars have provided evidence of the impact of these reforms
on citizens’ political engagement. Such reforms have been implemented throughout
the region, especially since the third wave of democratization, as a way to advance
democratic legitimacy and consolidation (Rodden 2004), making this issue highly
important. Wampler (2007), for example, provides compelling evidence of the
democratizing effect of participatory budgeting in Brazil. He claims that participa-
tory budgeting’s ability to deepen democracy hinges on institutional design and the
relationship between citizens, civil society organizations, and political actors.
Given the diversity of reforms implemented worldwide, scholars have also high-
lighted the analytical and theoretical distinction between “fiscal,” “administrative,”
and “political” models of decentralization (see Falleti 2005 for an explication of each
model). Other scholars have distinguished between two different forms of decentral-
ization: “deconcentration” and “devolution” (Eaton 2006).2 Analytically, our
research discusses the effects of an instance of political decentralization. According
to Treisman, political decentralization reforms “involve either assigning some deci-
sionmaking authority to lower tiers in a way that is difficult to reverse or assigning
residents of lower-level jurisdictions some rights to select lower-level officials, or
both” (2007, 23). Our study of the election of local authorities deals with the second
type of political decentralization reforms Treisman describes.
This study assesses the actual impact of the election of municipal governments
on citizens’ behavior and political attitudes in two small towns located in the
Uruguayan countryside. It thereby seeks to shed some light on the relationship
between changes in institutional design and citizens’ political attitudes and behavior
(see, e.g., Hiskey and Seligson 2003; Rhodes-Purdy 2013). We hypothesize that the
creation of local institutions, involving the election of local authorities in small rural
towns in Uruguay, boosts individuals’ interest and participation in politics, as well
as democratic legitimacy. We argue that this happens because political decentraliza-
tion reforms reduce the distance between citizens and the state by linking relatively
disregarded communities more closely to national institutions. This, in fact, was the
main theoretical expectation of the recent wave of decentralization reforms in Latin
America.
Dahl and Tufte (1973) discuss the relation between civic participation and the
scale of political units. They argue that the smaller the unit, the more opportunities
citizens have to participate—though they also stress that larger polities provide citi-
zens with the possibility of participating in making decisions more relevant for their
lives. Oliver (2000) points out that political participation depends on individual
resources and attributes, but also on such contextual factors as the size of different
political units. Studying U.S. cities, he found that people living in larger urban areas
 ROSENBLATT ET AL.: URUGUAY DECENTRALIZATION 95

are less likely to participate. In this regard, decentralization (i.e., the opportunity to
elect local authorities at the municipal level) reduces the scale of local politics: from
the departamento to the municipio.
Hansen et al. (1987) stress the importance of the distance between citizens and
institutions in large cities. For them, participation is negatively affected by increas-
ing bureaucratic complexity and spatial distance between government officials and
citizens. By the same token, Lassen and Serritzlew (2011) show how internal polit-
ical efficacy (i.e., individuals’ perceptions of their ability to participate in politics) is
negatively affected by the size of political units. The establishment of elected local
authorities who can act as locally accountable brokers brings the state closer to citi-
zens in Uruguayan small towns and thus should increase citizens’ internal sense of
political efficacy. This expectation is reinforced, as acknowledged by the literature,
by Uruguay’s status as a consolidated democracy with a healthy party system. Since
Uruguayans generally trust in political institutions at the national level, giving small
rural towns the opportunity to engage in political campaigns with direct appeals to
their specific issues should be valued as a positive and significant change (see
LAPOP’s various waves). If our hypothesis is correct, the treatment unit, where a
local election took place (Casupá), should differ from the control unit (Fray Marcos)
in terms of political engagement.
A leftist government carried through the reform, as has been the case with other
Latin American decentralization experiences (Goldfrank 2011). Uruguay stands out
for its relatively modest levels of economic inequality in the Latin American context.
Uruguayan institutions of democratic representation have not faced the significant
challenges described in the literature on Latin America during the last two decades
(Hagopian and Mainwaring 2005; Mainwaring et al. 2006; Mainwaring and Scully
2010). Conversely, democratic consolidation has proceeded relatively smoothly. Also
in contrast to other Latin American countries, there is no reason in Uruguay to suspect
weak central institutions of being the cause of decentralization reform. Even though
the decentralization reform described here marks the first relevant step in terms of
decentralizing a state that is, as Eaton (2004b) points out, one of the most centralized
in Latin America, decentralization has not emerged as a desperate response to a state
legitimacy crisis or in the context of weak institutions. Hence, there is no reason to
expect that decentralization would, in this case, ultimately contribute to the sort of
vicious cycle sometimes hypothesized as an unintended consequence of decentraliza-
tion in fragile democracies (e.g., Morgan 2011). Therefore, the reason to survey the
impact of political decentralization in such a small, relatively equal society with a func-
tioning state is that it stands as a crucial case (George and Bennett 2005); that is, its
structural conditions are relatively optimal for local democracy to work.
As a result of implementing the political decentralization reform in 2009,
Uruguay represents an unusual and particularly rich standard natural experiment
environment. In methodological terms, we are thus dealing with a comparative case
study with a natural experiment research design that functions as a crucial case
(Dunning 2012) for evaluating political decentralization on its own terms; that is,
in terms of its potential impact on citizens’ attitudes and behavior.
96 LATIN AMERICAN POLITICS AND SOCIETY 57: 2

The main goal of this research is to assess the impact of institution building—
specifically, that which brings political institutions closer to citizens—on attitudes
and political behavior. In this sense, does the election of local-level authorities foster
political engagement among citizens? Does the election of authorities at the local
level in Uruguayan towns change their citizens’ relationship to politics? For this pur-
pose, we have measured and compared citizens’ political interest and participation
in both the treatment town (Casupá) and the control town (Fray Marcos).

THE NATURAL EXPERIMENT

As Dunning (2012) points out, the use of natural experiments in the social sciences
has sharply increased in the last decade. This kind of research design has one main
advantage: it allows researchers to make more valid causal inferences by eliminating
the problem of confounding variables through (as-if) randomization and by reducing
issues of external validity by basing analyses on real world observations. In addition,
natural experiments share the virtues of mixed-methods research, which takes advan-
tage of the strengths of both qualitative and quantitative methods (Dunning 2012).
In this section, we justify our methodological argument that the settings in
which we conducted our survey constitute a natural experiment. For this purpose,
we will answer the following questions: Is there a treatment and a control group? In
this sense, does the assignment of the treatment follow a random or as-if-random
procedure? Is the intervention relevant for a theoretical argument (Dunning 2012,
235–310)?
Uruguay is a small country with a strong unitary state. It had just two levels of
government until 2009. The main state functions are concentrated at the national
level, and the second level of government, organized in 19 units (departamentos), has
historically been in charge of secondary functions (e.g., sewage collection and dis-
posal, refuse removal, municipal roads and storm water drainage, street lighting,
municipal parks and recreation, and city traffic management, among others). About
half of the Uruguayan population lives in Montevideo, the capital city, where the
most relevant political institutions and services are also concentrated. Although
there is an extended network of state welfare institutions throughout the country,
large percentages of citizens living outside major urban centers have infrequent
access to decisionmaking institutions attentive to their local needs.
The first leftist government, led by Tabaré Vázquez, implemented an institu-
tional reform in 2009 (Ley 18,567, Descentralización política y participación ciu-
dadana) to decentralize political authority and stimulate local participation.3 Decen-
tralization was part of the Frente Amplio (FA) electoral platform.4 The party
implemented decentralization reforms in Montevideo, a departamento (comprising
the capital city) that it had governed since 1990. It was therefore not surprising that
once it won the 2005 presidential election, the FA extended this part of its agenda
to the national level.
Among the main provisions of the 2009 law were the creation of municipali-
ties, with the intention of “providing efficient state services aimed at bringing state
 ROSENBLATT ET AL.: URUGUAY DECENTRALIZATION 97

management closer to all its inhabitants” and promoting “citizen participation”

(Article 3, authors’ translation). These hopes were in line with those of international
advocates of decentralization and local control (Bardhan and Mookherjee 2006;
Grindle 2007; Lassen and Serritzlew 2011).
Law 18,567 of 2009 stipulated that for the policy’s first phase (until 2015),
municipalities would be established in towns of at least five thousand inhabitants in
each departamento. Since many departamentos do not have towns meeting that
threshold, the law stipulated that at least two municipalities had to be created in the
two most populated towns of each departamento, for which the latest census, con-
ducted in 2004, was to be used as reference. This clear criterion ensured that the cre-
ation of municipalities was not contaminated by political calculus or spurious crite-
ria. Interviews with several intendentes (the highest elected executive office at the
departamento level) and policymakers of different state institutions confirmed that
no political calculus affected the assignment process. Comparing the list of munic-
ipalities established with population data from the 2004 census provides further
confirmation of the lack of political calculus (see online appendix). Thus, the cre-
ation of local political institutions, but more important, the election of local author-
ities in some towns but not in others generated an as-if-random assignment to the
treatment (towns where a local election took place) and control group (towns that
ranked third in each departamento in terms of its population).
We still must demonstrate that the intervention is theoretically relevant; that is,
that the observed effect is truly an empirical example of a hypothesized relationship
between concepts. Given the small size of towns we studied, localness and accessibil-
ity can be taken as givens. Therefore, we expect that the establishment of a new
authority resonates with the citizenry and affects their relationship with politics. We
expect this for two reasons. First, local elections in small towns foster citizens’ engage-
ment. Second, once an elected official takes office, citizens are more likely to expect
that official to be accountable and attuned to their actual issues. Both the democratic
election of the new local authorities and our qualitative evidence of close relationships
between citizens and their new mayors suggest that this principle is satisfied.
The reform called for elections at the municipal level concurrently with the
election at the departamento level. Therefore, in towns meeting the selection rules,
there were two ballots: one for the intendente and junta departamental (second-tier
jurisdiction) and one for the new municipal authorities. The latter ballot consisted
of a closed and blocked list of five candidates (with two substitutes for each). The
municipal posts were to be allocated following rules of proportional representation
(PR): the first candidate of the most voted list of the most voted party was elected
mayor.
These elections took place for the first time in May 2010, one year before we
conducted our fieldwork. In this sense, although it is not possible to evaluate the
broader effects of decentralization reforms in Uruguay, we were able directly to
assess the effects of local institution building on citizens’ political attitudes and
behavior. We have followed a multidimensional operationalization of political atti-
tudes and behavior related to engagement.
98 LATIN AMERICAN POLITICS AND SOCIETY 57: 2

Limitations of Our Design

Our analysis is based on assignment of treatment at the town level; therefore treat-
ment is assigned to clusters.5 Two problems thus arise. First, clustered assignment
with a small sample size risks large variability of treatment effect estimators (Dun-
ning 2012). Second, as is common with other experiments (natural or not), external
validity is aggravated in our study by small sample size (N = 2). Considerable care
must be taken at all stages of research before making generalizations about the phe-
nomena under study. We are aware of the limitations of our conclusions, and we
consider this research an initial contribution to the assessment of the impact of
decentralization reforms on citizens’ attitudes and political behavior. The richness
of this study lies in the natural experiment research design, which strengthens assess-
ment of the causal effect, albeit with these limitations.
Because the reform was enacted one year before our fieldwork, we cannot yet
substantiate any claims about how the changes in attitudes or behavior identified
will evolve, or whether they will even last. Future research would need to be con-
ducted to assess this issue. However, given the novelty of this reform, its theoretical
implications, and the high expectations it has generated in small towns, we believe
that the immediate impact of this institutional innovation is worth evaluating.

Case Selection
Although assignment of the treatment to clusters was as-if-random, our selection of
clusters (towns) for this study was not random. Given that we planned to conduct
surveys in only two towns, random selection was not a feasible method for eliminat-
ing the influence of confounding variables at the cluster level. Therefore we
attempted to control for as many confounding variables as possible by finding a
town dyad wherein most variables were constant.
Casupá is the second-largest town in its department and Fray Marcos the third;
thus only the former (and one other town in that department, Sarandí Grande) had
elections in 2010. In any case, the purpose of this comparative case study is to pres-
ent tentative, preliminary conclusions based on multimethod evidence, testing some
hypotheses about the effect of decentralization reforms on individuals’ attitudes and
behavior in politics.
Similarity between the treatment and control units is necessary in a natural
experiment research design. For this stage of our research, we decided to focus on
perfecting the experimental protocol and to pilot that protocol on a small scale
before committing to a larger sample of towns. To identify the best possible pair of
towns for the pilot study, we analyzed potential cases in depth. We conducted a very
strict analysis on the pretreatment equivalence of the treated and untreated units
(pair of towns). To accomplish this, we conducted a survey of indicators and we col-
lected qualitative evidence to understand the context. We chose a perfect match,
trying to eliminate potential confounders (Dunning 2012).
To confirm the similarity between Casupá and Fray Marcos regarding the the-
oretically relevant variables, we first gathered secondary data. We then interviewed
 ROSENBLATT ET AL.: URUGUAY DECENTRALIZATION 99

Map 1. Fray Marcos and Casupá

Source: Authors’ construction using georeferenced data from the INE.

qualified informants (scholars, journalists, politicians, and policymakers continu-

ously involved with this kind of location) and visited the towns to make observa-
tions and informally interview inhabitants. As a result, after extensively analyzing
the options of towns available to conduct the study, we determined that Casupá and
Fray Marcos constituted the best pair for the study. Then, after conducting our
fieldwork, we used the evidence collected through our surveys to reassess the towns’
similarity.
Casupá and Fray Marcos are almost identical for every theoretically relevant
variable. They are two small urban centers located in the departamento of Florida in
south-central Uruguay, about 120 kilometers from Montevideo. In fact, they are
just 12 kilometers apart (see map 1).6 According to the 2004 census, Casupá’s pop-
ulation was 2,668, making it the second most populous town in Florida (after
Sarandí Grande). Fray Marcos’s population was just 159 lower, at 2,509.
The 2011 census, conducted just after the reform and election we studied,
shows that the towns remain similar with regard to number of inhabitants, age and
sex structures, and education levels, among other theoretically relevant sociodemo-
graphic and economic variables usually significant in predicting political attitudes
and behavior.
100 LATIN AMERICAN POLITICS AND SOCIETY 57: 2

Table 1. Sex and Age Structures of Casupá and Fray Marcos (percent)

Casupá Fray Marcos

Sex
Male 47.8 48
Female 52.2 52
Age
0–14 23.8 23.3
15–29 21.1 20.3
30–64 36.3 37.9
65+ 18.8 18.5

Source: INE 2004

In 2011, Casupá had 2,402 inhabitants, only 4 more than Fray Marcos. Thus,
the small population difference observed in 2004 was even further reduced. The
populations of both towns are distributed almost identically in their sex and age
structures (table 1).
Levels of political engagement are also strongly affected by individuals’ socioe-
conomic status and education level. To control for variation in this regard, we first
looked at the percentage of people in each town living in households with unsatis-
fied basic needs (UBN). As shown in table 2, Casupá and Fray Marcos are also
extremely similar in this respect.
Both towns are also crossed by National Road Number 7, an important char-
acteristic of Uruguayan countryside towns, and both have a similar urban infrastruc-
ture (e.g., similar numbers of paved streets and similar types of housing). Both are
calm and free from social conflict, with no marked bimodal income distribution in
either case. Both have poverty, but also general access to basic utilities and accept-
able housing. Both towns have a significant presence of a mixed rural housing insti-
tution called MEVIR (Movimiento pro-Erradicación de la Vivienda Insalubre Rural,
which is said to date back to the end of the nineteenth century).7 Though not as
dramatic as in Montevideo, social segmentation and segregation are nonetheless evi-
dent in both towns.
Additionally, their structures of economic activity are almost identical. Newer
agro-industries are slightly more influential in Fray Marcos. As one local leader put
it, “Fray Marcos relies more on the private sector, while Casupá is more dependent
on the state.” Despite this impressionistic account, most locals insist on the towns’
overall economic similarity. As one policymaker familiar with rural towns put it, “if
there is a difference in terms of employment today, it is accidental; they are the
same; it is a big neighborhood.” Indeed, the 2011 census showed no critical differ-
ences in the percentage of people employed, unemployed, and inactive in the two
towns. Education levels across the two towns were also very similar.
In summary, the analysis of socioeconomic and demographic variables suggests
that Casupá and Fray Marcos are virtually identical in these dimensions, making sig-
 ROSENBLATT ET AL.: URUGUAY DECENTRALIZATION 101

Table 2: Percentage of Population in Households

with Unsatisfied Basic Needs

Households Casupá Fray Marcos

Without UBN 76.9 74.4

With 1 or more UBN 21.4 25.4

Source: INE 2011

nificant differences in levels of political engagement before treatment highly

unlikely.
In terms of the presence of state institutions—a key factor to control for our
research—Casupá and Fray Marcos are also indistinguishable. This is particularly
important in a country like Uruguay, where the state’s role is critical in a wide range
of economic activities and social services. In terms of educational provision, each town
has a public elementary school and a public secondary school. Neither has a private
primary or secondary school.8 Casupá and Fray Marcos also have nearly identical
health services. Each has two small medical centers, one public and one private. Public
(i.e., state) utilities companies have offices in each town. The same applies to offices of
the social security system, the Banco de Previsión Social (Social Security Bank).
For purposes of this study, it was essential to know about each town’s political
behavior. Unfortunately, we do not have historical data from public opinion sur-
veys. We therefore relied on comparing available data on past voting behavior. We
compared the voting behavior of the two towns in the last two cycles of national and
departmental elections, both of which had compulsory voting. In addition, we com-
pared the results of the 2004 and 2009 primary elections, for which voting was not
compulsory. The evidence shows that just prior to the decentralization reform, the
two towns had almost identical political behavior, whether in terms of turnout or
political preferences at the national or departmental level (see table 3).
As a local journalist comparing Fray Marcos and Casupá said, “the picture
would be the same.” This phrase summarizes the striking similarities between the
two towns.
Through our own survey, we compared the mean values of the two towns on
several other indicators. This evidence confirmed and reinforced our confidence
regarding our case selection. The two towns show similar averages in terms of indi-
viduals’ adherence to support for democracy, satisfaction with democracy, and per-
ceptions of how democratic Uruguay is. These indicators are usually considered indi-
cators of support for democracy at the national level, on which this reform should
have no direct effect, but are valid to compare structural support for democracy.
102 LATIN AMERICAN POLITICS AND SOCIETY 57: 2

Table 3. Pretreatment Political Behavior in Casupá and Fray Marcos (percent)

Casupá Fray Marcos

National elections
Partido Nacional 48.3 53.6
Partido Colorado 28.8 21.9
Frente Amplio 21.9 22.1
2005 Departmental elections
Partido Nacional 43.1 44.6
Partido Colorado 31.2 25.4
Frente Amplio 25.7 30.0
2009 National elections
Partido Nacional 42.2 43.4
Partido Colorado 34.1 29.9
Frente Amplio 21.9 24.7
Turnout in nonmandatory elections
2004 Primaries 55.8 55.2
2009 Primaries 54.3 51.2

Source: Uruguay, Corte Electoral

DATA AND ANALYSIS

We conducted surveys in both clusters (Casupá and Fray Marcos). We built a prob-
abilistic sample of 150 citizens for each town (polling 300 citizens in total) based on
the National Census Phase 1 (2004). The sizes of our two samples have a power of
.95, with an estimated true effect size of 10 percent difference between the two
groups, meaning that, were we to conduct the analysis an infinite number of times
with different samples, we would detect a significant difference 95 times out of 100.
Additionally, we conducted several interviews and informal conversations in
each town with politicians, policymakers, and local journalists. These interviews and
discussions were extremely important, since there is scant systematic information on
these types of towns in Uruguay. According to Dunning (2012), one of the most
important advantages of using natural experiments for multimethod research is their
capacity to combine the simplicity and transparency of quantitative analysis with the
credibility of qualitative analysis. Therefore, we combined a mean-comparison
analysis of the relevant variables for our two cluster groups with the qualitative evi-
dence we gathered through personal interviews of key informants. Because we are
confident in the strength of our natural experiment research design, the mean-com-
parison of cluster groups is a simple and transparent way to show causal effects.
Concepts like “political engagement,” “political institutions’ efficacy,” “politi-
cal trust,” and “political behavior” are highly abstract, and thus their indicators are
extremely prone to measurement error. This problem weakens estimates of the kind
of relationships in which we are interested. To overcome this difficulty, we used a
 ROSENBLATT ET AL.: URUGUAY DECENTRALIZATION 103

Table 4. Confirmatory Factor Analysis

Loading
Indicator (weight) p value
Engagement1 0.592 0.000
Engagement2 1.025 0.000
Engagement3 0.823 0.000
Engagement4 0.330 0.729
Engagement5 0.915 0.000
Engagement6 0.143 0.081
Engagement7 1.012 0.000
Engagement8 1.266 0.000
Engagement9 0.404 0.000
Engagement10 0.696 0.000
Efficacy1 1.144 0.176
Efficacy2 0.885 0.182
Efficay3 0.941 0.172
Efficacy4 0.934 0.177
Efficacy5 0.058 0.513
Efficacy6 1.034 0.170
Trust1 3.048 0.000
Trust2 10.112 0.000
Trust3 1.162 0.100
Trust4 2.652 0.002
Trust5 1.219 0.684
Trust6 8.077 0.005
Trust7 6.490 0.003
Behavior1 0.781 0.000
Behavior2 0.493 0.000
Behavior3 0.177 0.308
Behavior4 1.251 0.000

confirmatory factor analysis (CFA) model to assign relative weights to each question
(equivalent to the lambda parameter for each indicator). Those questions with
smaller error variances were given more weight while simultaneously estimating the
effect of the treatment on our dependent variables.9 Analysis was conducted in Stata
13, using maximum likelihood estimation (MLE) to estimate factor loadings and
scores, with standard t-tests to test differences in means. The factor loadings from
the CFA estimation are presented in table 4.10
The CFA differs from the exploratory factor analysis (EFA) in that the relation-
ships between latent factors and observed indicators are specified by the analyst,
with unknown parameters, rather than allowed to be completely free. The CFA
model assumes that for the ith respondent, indicator j of concept k is influenced by
two components. First, each respondent’s answer to question j is influenced by the
value of an unobserved latent variable k. The latent variable is assumed not to have
104 LATIN AMERICAN POLITICS AND SOCIETY 57: 2

a one-to-one correlation with each indicator; hence indicator j is also influenced by

random measurement error. The equation for each indicator is

xij = λjk ζk + δij ,

where xij is the ith respondent’s response to question j, λjk is the factor loading of
question j on latent concept ζk, and δi is the measurement error component of ques-
tion j for the ith respondent.
Our model has a factor complexity of 1, meaning that all questions load on
only a single factor; in other words, all questions are considered to be indicators of
only a single latent concept. Using maximum likelihood estimation, we can estimate
the loadings of each factor, which, in turn, can be used to estimate the value of each
latent concept ζk for each respondent. We can then compare differences in the
means of each latent concept (ζk ) across treatment and control, as is usually done in
experimental analysis.11
It should be noted that our sample was quite small. However, we think that
weight estimates, while subject to large standard errors due to sample size, are prefer-
able to the unfounded assumption of equality of importance that would be implicit
in the creation of a raw count variable.

RESULTS
Our research focuses on the political attitudes and behavior of citizens living in
small towns. We particularly aim to assess whether the election of local authorities
has an impact on those variables. More specifically, we want to determine whether
there are differences between our treatment and control units for those variables rel-
evant to defining political behavior and attitudes toward politics.
Regarding our hypotheses, we believe that the creation of local political institu-
tions and the opportunity to elect local authorities increases the positive attitudes
and proactive behavior of citizens toward politics. We expected the citizens of
Casupá (treatment) to exhibit more positive attitudes toward politics than Fray
Marcos citizens (control). We surveyed citizens’ attitudes on political engagement,
political institutions’ efficacy, and their trust in political institutions. In addition, we
expected Casupá’s citizens to participate more in politics.
The evidence collected through our fieldwork gives preliminary support to our
expectations regarding the positive effect of the political decentralization reform.
This reform appears to have improved individuals’ opinions of the efficacy of poli-
tics and political institutions, as well as of the democratic legitimacy of representa-
tive institutions. Although we have a small number of groups (j = 2), making it
impossible to reach more general conclusions, this pilot study suggests that the cre-
ation of local-level institutions can make a difference.
The results of the statistical analysis, presented in table 5, indicate that there is
a statistically significant difference between the means in Casupá (treatment unit)
and Fray Marcos (control) in individuals’ assessment of the efficacy of politics and
 ROSENBLATT ET AL.: URUGUAY DECENTRALIZATION 105

Table 5. Summary of Results

Means
_______________________________________________________
N Efficacy Trust Engagement Behavior

Fray Marcos 145 –0.096 0.062 0.020 0.065

Casupá 130 0.282 0.301 0.256 –0.072
–0.378* –0.239* –0.236 0.137

* Indicates a significant difference at the .05 level.

political institutions and their trust in political institutions. The significant differ-
ence, given the as-if-random assignment of two nearly identical towns to treatment
and control groups, strongly implies that political decentralization reform has
brought citizens closer to the political administration, increasing trust in institutions
and improving citizens’ perception of political institutions’ efficacy.
However, there is no statistical significance in individuals’ opinions on engage-
ment, although the difference is commensurate with that of the rest of the attitudi-
nal variables. Moreover, the results in terms of actual participation behavior
reported in our surveys actually showed higher levels of participation in Fray Marcos
(control unit), although the difference was not statistically significant. In the course
of our three-month stay in the two towns, we did not experience a qualitative dif-
ference in terms of the political activity in each town. These results, again, reinforce
the idea that this type of political decentralization has a deeper effect on attitudes
than behavior. We see a clear trend in results: moving from attitudinal to behavioral
variables, any impact of the treatment declines until it disappears entirely.
These results could perhaps indicate that the impact of the election of local
authorities is first and foremost seen in attitudinal dimensions, while to observe a
change in behavior, perhaps more time has to elapse to before significant change
occurs.12 Moreover, given that the decentralization reform only created new author-
ities and not local-level participatory mechanisms (e.g., town meetings), there is no
reason to expect a significant change in political behavior. Thus, this reform has not
added significance to local citizenship apart from voting for local-level authorities
every five years.
Furthermore, our qualitative evidence suggests that a major problem of these
new institutions is their lack of resources and uncertainty about their role or the
rules for allocating resources. When we talked to policymakers in state institutions
associated with local development, they claimed that mayors had no budget assigned
to them and that clarity regarding their authority was still lacking.
106 LATIN AMERICAN POLITICS AND SOCIETY 57: 2

CONCLUSIONS
Decentralization has been a matter of substantive debate for some time among
scholars as well as policymakers. This article has analyzed the impact in two small
rural towns of a political decentralization reform enacted in Uruguay. The reform
generated an as-if-random assignment to treatment (creation of municipality),
which is of great use to assess its impact.
Our two-town pilot study represents the first attempt to use a natural research
design to measure the impact of decentralization reforms on citizens’ political
engagement. The study provides preliminary evidence supporting claims that the
creation of local-level democratic institutions has a positive impact on the average
individual’s political attitudes. Our means tests show a significant difference
between our treatment (Casupá) and control (Fray Marcos) units when it comes to
citizens’ trust in political institutions and perceptions of their efficacy. This suggests
that the 2010 Casupá municipal elections successfully brought citizens closer to the
political administration, and that Casupá’s citizens have more trust in political insti-
tutions and believe that these institutions are more efficient than do their Fray
Marcos neighbors.
Nevertheless, in terms of attitudes toward engagement and actual political
behavior, our quantitative and qualitative evidence does not support the idea that
political decentralization has a transformative impact. Our hypothesis is that this
could be explained by the recent implementation of the reform. Our fieldwork was
conducted one year after the first municipal elections in Uruguay, and decentraliza-
tion reforms may require more time to affect citizens’ political behavior than their
attitudes. Further research is needed to test this hypothesis. It is plausible that the
results are more clearly related to the expectation generated by the reform and the
electoral process that took place in Casupá than to the actual functioning of the
recently elected municipio. A new project could build on our findings to extend the
time frame and evaluate the impact of the reform from a larger perspective.
When analyzing the effects of the Uruguayan decentralization reform, we
should also take into account that up to now, the reform has only involved intro-
ducing election of authorities at a level below the departamento. In line with the
observed results, we believe that to extend this reform to its full democratizing
potential and boost political engagement, more participatory opportunities may
need to be granted. There are very interesting experiences of local-level participation
that could serve as an example for this kind of rural town (e.g., the recent town
meetings implemented in the municipality of Providencia in Chile). Uruguay’s
18,567 Law of Decentralization does include participatory mechanisms, but they
have not yet been implemented.
The Uruguay decentralization reform provides a very rich opportunity for
unraveling the effects of political decentralization reforms on democratization. The
results of this pilot research are encouraging and justify more ambitious efforts. In
order to take full advantage of the natural experiment afforded by the terms of
Uruguay’s decentralization reform, a larger number of towns should be included in
 ROSENBLATT ET AL.: URUGUAY DECENTRALIZATION 107

further analysis. Broadening the time and space horizons of our initial pilot study,
therefore, should be considered the next step needed to reach more conclusive
results and to test the competing new hypotheses that have arisen from this pilot
study, particularly those concerning decentralization reforms’ differential impact on
political attitudes, as opposed to participatory behavior.

NOTES
This article is part of the project “The Architecture of Diversity: Institutional Design
and Conflict Resolution in the Americas,” funded by the International Development
Research Centre, Canada (IDRC).We would like to thank Matthew Rhodes-Purdy for his
invaluable help with the analysis of our data. We also want to thank Thad Dunning for his
comments and advice on this research. Regarding our fieldwork, we are thankful to Verónica
Piñeiro, Lihuen Nocetto, and Mariana Felartigas for their precious help. Additionally, we
thank the Instituto de Estadística of the Universidad de la República, Uruguay, in particular
Juan José Goyeneche and Eugenia Riaño for their support with the sample. We also would
like to thank the participants of research design session 3.2 at the 2012 Institute of Qualita-
tive and Multi Method Research, those of the Seminarios ICP (Instituto de Ciencia Política)
at the PUC-Chile, and comments received at the Escuela de Métodos Mixtos held at the
PUC-Chile (Millenium Nucleus NS100014). We also thank Antonio Cardarello, Ana Zebal-
los, Diego Hernández, and Juan Pablo Luna. We appreciate the useful insights and comments
from the anonymous reviewers. Finally, we are very thankful to the citizens of Fray Marcos
and Casupá who agreed to answer our questionnaire. All remaining errors are our own.
For additional details on comparative data, codes, and indicators used, see the online
appendix, www.icso.cl/investigadores/fernando-rosenblatt.
1. Uruguay is administratively divided into 19 departments (departamentos). Depart-
ments are the second level of government. Following Treisman’s conceptualization, the
departamento is Uruguay’s second-tier jurisdiction (2007, 22). Except for Montevideo, the
capital of each departamento was excluded from the size criterion.
2. Schneider (2003) makes a significant contribution in terms of concept and measure-
ment by proposing a clear-cut definition and measures.
3. Law 18,567, Political Decentralization and Citizens Participation. Text available at
http://www.parlamento.gub.uy/leyes/AccesoTextoLey.asp?Ley=18567&Anchor=
4. Tabaré Vázquez was elected president, representing the left-of-center Broad Front
(Frente Amplio, FA) party. The FA won the 2004 presidential election and the subsequent
election in 2009. By the end of Vázquez’s administration, the reform had become law.
5. Dunning (2012) analyzes this aspect and reviews Posner’s 2004 study of Zambia and
Malawi.
6. Though they are small urban towns, they are not the most isolated in Uruguay.
Ismael Cortinas in the departamento of Flores has also elected a mayor, but there is no com-
parable town constituting a suitable match for it as in our dyad.
7. For further information see http://www.mevir.org.uy/.
8. Information about social services is based on the Geo-referenced Information System
(SGI) of the Ministry of Social Development of Uruguay (MIDES). http://mapas.infamilia.
gub.uy:8080/Uruguay/map.phtml
9. The indicators used for engagement were a series of Likert scale phrases, such as “Par-
ticipation in politics is a good way to solve people’s problems.” The indicators used for effi-
108 LATIN AMERICAN POLITICS AND SOCIETY 57: 2

cacy consisted of a series of Likert scale phrases, such as “The election of mayors and local
councilors is a waste of resources.” In both cases, respondents were asked to indicate their
degree of agreement or disagreement with the sentence. The indicators used for trust con-
sisted of a series of institutions in which the respondent was asked to describe his or her
degree of trust (from 0 to 10).
10. The loading is a relative measure of the connection between the concept we are
trying to measure and each particular indicator. The loading is somewhat analogous to regres-
sion coefficients, with the latent, unobserved factors “causing” each of their observed indica-
tor variables. If the loading is not significantly different from zero, it indicates that the indi-
cator is not related at all to the concept in question. See the online appendix for a detailed
description of the indicators used.
11. See the online appendix for the code used.
12. The lack of significance in the difference in engagement seems to be due to a greater
unexplained variance, resulting in larger standard errors. It is possible that having a larger N
for each group would have produced a significant result.

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