Bad governance undermines development.Two important types of World Bank support for localgovernance are social funds and broadly based support forgovernments committed to decentralizing responsibility andpower to local governments and other local institutions. Butthere are concerns that these two approaches, which addressdifferent elements of governance, sometimes work atcross-purposes. A study was therefore commissioned toexamine the interaction between social funds anddecentralization in Bolivia and Honduras (advanceddecentralization), Peru and Zimbabwe (somedecentralization), and Cambodia, Malawi, and Zambia (littleor no decentralization). This Note is based on the findingsof the study.