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Can the variation of local governance outcomes – five years after Indonesia's rapid decentralization - be sufficiently explained by well-established theories of subnational competition or civic accountability? Based on a comparative study in eight districts, Christian von Luebke, Doctoral Candidate, Crawford School of Economics and Government, Australian National University, Canberra argues that local business conditions to date relate less to such demand-side arguments but more the supply-side factor of government leadership. In this early stage of decentralization, the cross-district analysis indicates that varying business climate indicators are positively connected to leadership indicators of incumbent district heads. Dennis de Tray, Vice President at Center for Global Development, moderated this discussion.