This paper examines how the history of grievances, demands, and identity has played out in the context of decentralisation in Nigeria and Indonesia. This includes the devolution of political, administrative and fiscal responsibilities and resources to local authorities and the creation of new districts and local government areas. Evidence from the case studies demonstrates that although decentralisation can be a useful conflict-mitigating mechanism by accommodating diversity and managing historical grievances with centralised government, decentralisation can in some instances generate new tensions in communal, ethnic and religious relations. The decentralisation process interacts with conflict dynamics by stimulating demographic changes and creating incentives for local elites to compete for power and resources by mobilising group identities. The paper finds that a key predictor of whether or not decentralisation can mitigate conflict is its impact on horizontal inequalities (inequalities between groups). However, decentralisation can also assist with conflict mitigation by providing self-autonomy and an institutional framework for managing tensions at the local level, as long as the process is implemented as promised to local peoples. An awareness of some of these dynamics is important for managing diversity and structural change through decentralisation.
CRISE Working Paper No.49, 32 pp.