This article introduces a new concept to the study of decentralization processes: policy dynamism. At its core is the notion that the sequential and temporal process of health decentralization affect the nature of intergovernmental relationships and municipal bureaucratic capacity. Examining the case of Brazil, I argue that the rush to decentralize health services to municipalities has, in the absence of sufficient financial and technical assistance from the federal and state governments, increased state-municipal conflict over the management of health policy, limiting municipalities' ability to increase bureaucratic capacity. Consequently, some states have attempted to recentralize reforms, generating further conflict between both subnational levels of government. While some municipalities have tried to overcome these problems by creating associations and working with international organizations, several bureaucratic obstacles remain. This article attributes these outcomes not to federal institutions and economic constraints (the traditional approach in the literature) but rather to the noninstitutional, temporal policy dynamics of decentralization.

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