The Local Autonomy Index (LAI)

In this chapter we attempt to create an index of local autonomy. Ideally, such an index includes all the different aspects of local autonomy discussed in the literature and combines them according to their importance. The chapter emphasises the choices made while constructing the index and suggests different ways to test the results. Given the multidimensionality of local autonomy, we argue that the local autonomy index (LAI) has a formative character. We first combine the original standardised 11 variables to 7 theoretically and empirically meaningful dimensions of local autonomy: that is, legal autonomy, political discretion, policy scope, financial autonomy, organisational autonomy, access and non-interference. Favouring a functional and economic approach, we argue that particular weight should be given to political discretion and financial autonomy. Together with legal autonomy, we claim that these three dimensions form the cornerstones of local autonomy. The overall index simply aggregates the seven weighted dimensions. The results are presented as mean values for the five five-year periods between 1990 and 2014 as well as country rankings and country-specific patterns of local autonomy.