mapa boliviaRegional economics refers to a specific geographical area, such as the economy of the Latin American region. For instance, “the economy of the region” could refer to the import and export results of the American countries taken as a whole, as well as all investment and labor statistics etc. Similarly, the Asian regional economy could be labeled the “Asian group” or the Asian Tigers etc. Otherwise, when talking about a world economy we are referring to the economy of the whole world. A more current example would be the BRICS countries, Brazil, Russia, India, China and South Africa, which are affiliated for their displays of global integration in the face of economic crises.

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Decentralisation can be understood as the process and functioning of an organisation. It involves transferring power from a central government to authorities that are not hierarchically subordinate. The relationships between decentralised entities are always horizontal and not hierarchical. An organization has to take strategic and operational decisions. Centralization and decentralization are two opposite ways of transferring decision making power and of changing the organizational structure of companies concordantly.



Bolivia has undergone a transformation since 2008, which has seen it turn gradually towards decentralisation. This change was lead by the New Political Constitution of the State which attends to the municipalities, provinces and governorates, where decentralisation is placed within the context of municipals and autonomies. The municipalities are free to decide how to implement their budget, how to achieve regional economic growth and which integration projects with local communities will reflect an improvement in the agriculture sector as well as in infrastructure and technologies.


A decentralised government

The decentralisation of a state can be political, administrative and social, and it can happen in different degrees or levels.

Characteristics of decentralisation:

1-     Transfer of powers from central government to new moral or legal entities.

2-     The state gives legal entity to the decentralised body.

3-     It is assigned its own capital and a management that is independent of the central government.

4-     The state only exercises supervision over them.

5-     It is based on an autarky principle (economic and political organization of a state founded on self-sufficiency.

Decentralisation reinforces the democratic character of a state and the collaborative participation principle enshrined in many constitutions of the Spanish-American legal tradition.

Regional Development

Bolivia bandera

In this light, regional economic development can be defined as a process of transformation of the economy (investment, technology, infrastructure) and society (human capital, social capital) aimed at overcoming existing difficulties and challenges within a region or border. It seeks to improve the living conditions of the population and region through decisive actions coordinated by different local socioeconomic agents. 

It is also necessary to highlight the importance of the external financing, which has been essential to developing countries in ensuring an incorporation of technology, training of work force and currency uptake.

In the case of Bolivia and the New Political Constitution of the State, a development model that focuses on the productivity of regions and territories has been accepted. The plan considers communities, provinces and departments, and puts emphasis on their different potentials for the joint development of the country, for example: agricultural sector, industrial sector, tourism.

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