Every facet of life across every jurisdiction or border has been affected by COVID-19, the pandemic currently sweeping the globe. As the pandemic unfolds in the United States, it has become clear that the federal response is insufficient. Instead, bottom-up efforts from individuals, businesses, state and local governments, and civil society are driving response and recovery. Coming back from crises takes an abundance of efforts at a variety of scales. While much of the focus is on the need for and subsequent challenges of top-down efforts, encouraging a multifaceted response is important for hastening recovery and building resilient communities.
Polycentricity as a Form of Governance
Elinor and Vincent Ostrom distinguished between governance systems organized according to monocentric principles and alternative systems that are characterized by patterns of polycentric ordering. In monocentric orders, decision rights are consolidated in the hands of a single authority or node of decision-making. As a result, the system may benefit from economies of scale. In contrast, polycentricity is “a system where citizens are able to organize not just one but multiple governing authorities at differing scales.” This more decentralized system is characterized by various overlapping and competing units that govern based on their local needs and capabilities. The result is a system that allows for more adaptation, competition, and flexibility.
Today, many metropolitan areas are organized as one large, monocentric governance system, functionally integrated by economic and social relationships. Vincent Ostrom, Charles M. Tiebout, and Robert Warren, however, cautioned against this approach and argued that polycentric overlapping systems offer similar but differentiated services that respond to the wide and diverse interests of varying communities. Fieldwork bolstered their case. For example, Elinor Ostrom and her colleagues compared areas in Indianapolis, Indiana that consolidated the provision of police services to other areas that remained more autonomous. The study found that residents living in the localized jurisdiction were more satisfied with police services than residents living in consolidated jurisdictions. Similar studies conducted in Chicago, Illinois; Grand Rapids, Michigan; Nashville-Davidson County in Tennessee; and St. Louis, Missouri also found that small police departments with a high degree of community involvement were able to leverage personal knowledge and local ties to improve or maintain community satisfaction with the police. Overall, the findings showed that police and citizens engaging in the coproduction of public safety could provide better, more targeted service to their communities.
Access to local knowledge at lower levels of government means that policies and programs are better able to match the context of the individuals receiving them. Conversely, more centralized programs tend to have strict rules and procedures that lack the flexibility those they aim to assist need. For example, one criticism of small business loans provided by the Small Business Administration (SBA) in response to the pandemic is that they stipulated that 75 percent of the loan needs to be allocated toward wages for the recipient to qualify for loan forgiveness. As a result, businesses that face large fixed costs, such as rent, utilities, mortgage interest, or costs to maintaining inventory, are disadvantaged relative to businesses where labor is a major expense. While the SBA released new guidance on June 12 that reduced the wage requirement to 60 percent and allowed for partial loan forgiveness for those businesses that could not meet that target, it is difficult to tailor effective response and recovery efforts without knowledge of the needs of individuals and businesses on the ground.
Programs by local governments, however, may offer a more tailored or adaptable way of supporting small businesses. For example, the city of Philadelphia, Pennsylvania in partnership with the Philadelphia Industrial Development Corporation and the Department of Commerce, created a COVID-19 Small Business Relief Fund to provide grants and zero-interest loans to impacted businesses. A single application allowed businesses in need to apply for three relief programs. As of May 14, a total of 2,083 small businesses have been selected to receive $13.3 million, with 60 percent of the award going to minority business owners and 32 percent going to woman-owned businesses. Cities are also organizing staff to provide technical assistance to business owners as they apply for SBA loans and reaching out to minority-owned businesses that might face structural barriers in completing applications. For example, the city of Chattanooga, Tennessee is hosting webinars in partnership with city councilmembers specifically for minority-owned businesses and partnering with local non-profits to work with Spanish-speaking business owners. Localized polycentric systems are likely to be better than centralized monocentric systems at solving community challenges where flexibility and adaptability are important, such as during times of crisis.
Moreover, polycentric institutional systems cultivate resilience. Resilience depends on innovation made possible by flexible, adaptive, and redundant (or overlapping) institutional processes. Polycentric systems provide the space for entrepreneurs to drive social change, which is important for fostering community resilience. While large, centralized, monocentric forms of governance may exhibit some economies of scale in the organization of public services, it is at the cost of a single dominant decision center becoming “insensitive and clumsy in meeting the demands of local citizens for the public goods required in their daily life.” Polycentric political systems are, overall, more responsive to diverse citizen needs and more effective in empowering individuals to overcome crises than monocentric alternatives.
A decentralized approach to COVID-19 response and recovery will necessarily be heterogeneous. It will differ by region, industry, neighborhood, family, or individual, according to their needs. Policies for rural counties with low populations should look different from policies in densely-populated cities. The brick-and-mortar retail industry is going to need different types of assistance and safety procedures than online retail businesses. Some families will need food assistance, while others may use their well-stocked pantries to cook large meals for their neighbors and extended families. Nursing homes and dialysis centers will need to enact stricter procedures for building access and personal protective equipment than accounting firms. Recovery over the upcoming months is going to look different for the elderly and those with compromised immune systems than it will for younger, healthier individuals. The flexibility allowed through polycentric decision-making ensures that localities, neighborhoods, and businesses can experiment with policies and procedures that suit their constituents, neighbors, and customers. For example, states can follow Arizona’s lead in proposing legislation to allow businesses to operate from residences without needing to obtain a license or rezone their home for commercial use. This will allow individuals the flexibility to maintain their small businesses in tumultuous times.
Decentralized Government in Response to Centralized Challenges
Nevertheless, there is an overemphasis on federal efforts by policymakers, the media, scholars, and the public. In times of crisis, we often turn to the federal government, with its large budgetary powers and access to expertise, to assess the situation and direct efforts. However, the federal government faces just as many, if not more, challenges to accessing information and coordinating response and recovery efforts than its more decentralized counterparts.
The US federal response to the pandemic has suffered from poor preparation, leadership challenges, coordination failures, regulatory uncertainty, and slow implementation. On February 12, 2020, the Centers for Disease Control and Prevention (CDC) revealed that its testing kits were flawed. The CDC didn’t widen testing criteria to allow alternative organizations to produce tests until March 4. The Food and Drug Administration (FDA) delayed allowing public and private labs to use non-approved tests and seek retroactive approval until February 29, days after the first incidence of community spread was announced. Further, the White House has offered confusing and conflicting stances on the state of testing in the United States. Restricted testing capacity and the low accuracy of existing tests has severely limited the ability to understand the infection rate and spread of the virus, and to plan accordingly at all levels.
Maryland Governor Larry Hogan and his wife Yumi Hogan leveraged their connections in South Korea to order 500,000 tests when federally-supplied tests were insufficient. They stored the tests in an undisclosed location for fear of them being seized by government authorities, which was the fate of 3 million N95 masks acquired by Massachusetts Governor Charlie Baker. Illinois Governor J.B. Pritzker ordered millions of masks and gloves from China. But not all governors have the connections necessary to get essential equipment. Colorado Governor Jared Polis made an official request to the federal government for ventilators, wrote to Vice President Mike Pence, and tried to purchase supplies himself with no luck. The federal government either was nonresponsive, seized purchases, or bought supplies before states could acquire them. It wasn’t until the state’s Republican Senator Cory Gardner called President Trump that the state was able to receive 100 ventilators. Inefficiency and uncertainty from the federal government stymied state and local efforts to acquire medical equipment and tests.
Implementing the CARES Act has faced similar problems at the federal level. As of June 5, an estimated 30–35 million payments had yet to be issued. The SBA’s loan program has proven similarly frustrating. Business owners with preexisting loan relationships with banks participating in the program were often more successful applying and receiving funding than businesses with no prior experience. The first allotment of Paycheck Protection Program (PPP) money ran out in 13 days, the second round lasted less than a week. While three quarters of small businesses applied in the first round, only 20 percent received money. Early evidence shows that PPP funds flowed to areas that did not face major declines in hours worked or business shutdowns. Because the PPP relied on a “first come, first serve” model, self-employed people who were not allowed to apply until the second week of the application period never got a chance to receive funding from the already maxed out program. Public outcry over big businesses receiving loans –including chains like Ruth’s Chris Steak House and Shake Shack, and the LA Lakers basketball team — demonstrated the mismatch between the public’s expectations and the results. Furthermore, the PPP lacks application criterion to assess the needs of applicants and make decisions based on the most pressing economic constrains. For instance, many retail storefronts had enough capital to keep staff on payroll but had little or no work for them to do, whereas other businesses had pressing cash flow problems.
When the federal small business loan program proved insufficient to meet demand, many county governments stepped up and provided more targeted support. For example, Montgomery County’s council anticipated many of their residents would be switching to telework and that some would not receive needed private or federal loans. As a result, the county, a DC area suburb in Maryland, implemented the Telework Assistance Program providing reimbursements to organizations for expenses related to the transition to remote work. Likewise, the Montgomery County Public Health Emergency Grant program provided grants to offset losses due to COVID-19 to a wide set of local businesses, including independent contractors and sole proprietors. 75 percent of the 6,764 grant applications came from businesses with 10 or fewer employees and 15 percent of recipients were sole proprietors. All in all, Montgomery County approved 2,268 awards for a total amount of $20.27 million. Maryland’s experience in loan relief and test acquisition demonstrates the value of a more polycentric structure of decision-making during crises.
The Role of Civil Society
“Americans of all ages, all conditions, and all dispositions, constantly form associations… Wherever, at the head of some new undertaking you see the government in France, or a man of rank in England, in the United States you will be sure to find an association.” — Alexis de Tocqueville (1835)
A number of localized, community-based efforts have emerged to solve pressing problems in the time of COVID-19. Their success relies on their ability to quickly adapt to the ever-changing situations and the unique tacit knowledge available to those embedded in specific environments and circumstances. As such, civil society is often a complement and integral component of polycentricity.
Religious congregations have long played a role in providing and supporting social services within communities. Their social service programs are often small, localized efforts that respond to acute community needs. It is, thus, not a surprise that faith-based organizations are playing an important part during the COVID-19 pandemic. In North Carolina, a private foundation called The Duke Endowment is providing emergency grants to rural churches throughout the state. Some of these rural churches are using their emergency grants to pay local restaurants to provide meals to their congregation and greater community. The Fund for Jewish MKE, a source of funding for the Jewish community in Milwaukee, Wisconsin, has raised more than $1.5 million, including $51,500 for three Jewish schools to purchase Chromebooks for distance learning, $45,000 for a Jewish community center for virtual and in-home programming, and $25,000 for Jewish Family Services to deliver groceries to seniors, adults with disabilities, and low-income families. The Fund also provided tax consultants who helped local Jewish organizations secure more than $10 million in SBA funding.
Similarly, many local nonprofit organizations are shifting their focus to utilize their local knowledge to provide relief to communities in need. Operation BBQ Relief, a disaster relief organization that was formed after the 2011 Joplin Tornado, launched a new program called Operation Restaurant Relief. The new initiative revives closed restaurants in Kansas City, Missouri by utilizing their kitchens to provide free meals to essential workers and those in need. The restaurants are able to rehire laid off workers and receive a stipend for their participation from Operation BBQ Relief. They plan to expand their efforts in Philadelphia and Pittsburgh as well by working in conjunction with the Pennsylvania Department of Human Services. This partnership allows Operation BBQ Relief to provide vital meals throughout the state of Pennsylvania and increase meal capacity to over 180,000 meals per week.
Another nonprofit, Seeding Sovereignty, an Indigenous women-led nonprofit, noticed that critical financial support was not reaching Indigenous communities in New Mexico. They created the Indigenous Impact Community Care Initiative to provide food, funds, supplies, and books to elders, families, and frontline workers as well as to homeschool children in Navajo, Apache, and Pueblo communities. Native Americans are disproportionately suffering from COVID-19 and its economic impact. This nonprofit was able to identify community members most at risk during a crisis and provide critical aid to those in need.
Civil society, comprised of local organizations — such as faith-based congregations, food banks, nonprofits, etc. — provide entrepreneurial responses to problems posed by the COVID-19 pandemic. The connection these organizations have to the communities around them are critical to their success. They are able to identify gaps in support, especially among vulnerable populations, and utilize their knowledge of the specific contexts within which they operate to provide relief for their communities. Similarly, despite systematic funding issues in journalism, Coronavirus reporting has increased subscriptions to local news services, who are best positioned to inform residents about how to interpret stay-at-home orders and virus risk in their area. Unleashing entrepreneurial action provides people with needed goods and services, encourages essential social connections, and signals that recovery is likely to occur.
The Role of Technology
Polycentricity allows for competition between different public and private providers of goods and services, which, in turn, leads to innovation. During the pandemic, entrepreneurs have designed no-touch door openers, doorknob sleeves, smart mirrors that demonstrate proper handwashing, and sanitizing robots for airports and hospitals. Innovations in telemedicine and online platforms have made widescale social distancing possible. For example, platforms such as Zoom, Webex, and Google Meet have allowed musicians, businessmen, politicians, teachers, and fitness instructors to adapt to presenting and engaging their constituents and customers online. Additionally, companies are building 3-D representations of office spaces on virtual reality platforms to help employees adapt to telework. For many employees, teleworking has translated to more flexible work arrangements that will persist, paving the way for public and private employers to explore new business models and rely on more robust and disparate talent pools.
Online platforms also facilitate decentralized response and recovery efforts. The ability to coordinate at a distance means that high-risk populations can receive no-contact deliveries from strangers via Doordash, Uber, Instacart, Amazon, or GrubHub. Individuals can start fundraisers for the unemployed on GoFundMe, or create a platform for connecting potential donors directly to those in need, like the Virtual Tip Jar. Furthermore, online platforms can connect new buyers to sellers who have excess supply. For example, a woman posted on social media to help an egg farm in Pennsylvania facing decreased demand, encouraging her followers to buy cheap eggs, help a local farmer, and save free-range chickens from euthanasia.
State spending on technology is also on the rise. Efforts include technologies to improve seafood packaging in Oregon, identify invasive species in Idaho, and implement STEM education training for specific industries. As technology-related funding becomes more polycentric in nature, it is possible that technologies targeted to local needs and local capacity for knowledge-based economies will flourish. For example, localities dependent on retail revenues would benefit from contact-less checkout technologies such as Amazon’s “Just Walk Out” service as well as pre-booking services to moderate customer flow. Evidence from past disasters suggests that technology facilitates locally-relevant information sharing, builds community resources, and brings people together. In this way, technology makes communities more resilient and allows for more polycentric arrangements.
Polycentric systems are more flexible, adaptable, and responsive to the needs of the people than their monocentric counterparts. Nevertheless, centralized solutions often receive the primary focus of our attention even while facing delays, uncertainty, and failure. State and local governments, businesses, and civil society provide alternative solutions and often do so in a more creative, cost-effective, and timely manner. Individuals and organizations operating at the local level have the specific knowledge necessary to find creative and innovative approaches to providing relief. Polycentric systems encourage the discovery of this context-specific knowledge and provide the space for individuals to figure out how to best overcome crises and deliver targeted aid.
Stefanie Haeffeleis a senior fellow for the F. A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics at the Mercatus Center at George Mason University.
Jessica Cargesis a program manager for Academic & Student Programs at the Mercatus Center at George Mason University and a PhD student in economics at George Mason University.
Anne Hobsonis a program manager for Academic & Student Programs at the Mercatus Center at George Mason University and a PhD student in economics at George Mason University.
 Elinor Ostrom, “The Challenge of Crafting Rules to Change Open-Access Resources into Managed Resources.” In Is Economic Growth Sustainable? (Edited by G. Heal, 168–205. New York: Palgrave Macmillan, 2010.)
 Vincent Ostrom, Charles M. Tiebout and Robert Warren, “The Organization of Government in Metropolitan Areas: A Theoretical Inquiry.” American Political Science Review 55, no. 4 (1961): 831–842.
 See Elinor Ostrom, William Baugh, Richard Gaurasci, Roger Parks, and Gordon Whitaker, Community Organization and the Provision of Police Services. (Beverly Hills, CA: Sage Publications, 1973); Elinor Ostrom, Roger Parks, and Gordon Whitaker, “Do We Really Want to Consolidate Urban Police Forces? A Reappraisal of Some Old Assertions.” Public Administration Review, 33, no. 5, (1973): 423–432.
 See Samir Ishak, Consumers’ Perception of Police Performance: Consolidation vs. Deconcentration: The Case of Grand Rapids, Michigan Metropolitan Area, (Ph.D. dissertation, Indiana University, 1972); Elinor Ostrom and Gordon Whitaker, “Community Control and Government Responsiveness: The Case of Police in Black Communities.” In Improving the Quality of Urban Management in Urban Affairs Annual Reviews. (Edited by D. Rogers and W. Hawley, 303–334. Beverly Hills, LA: Sage, 1974); Roger Parks, Assessing the Influence or Organization on Performance: A Study of Police Services in Residential Neighborhoods, (Ph.D. dissertation, Bloomington, Indiana University, Department of Political Science, 1979); Bruce Rogers and C. McCurdy Lipsey, “Metropolitan Reform: Citizen Evaluations of Performances in Nashville-Davidson County, Tennessee,” Publius no. 4 (1974): 19–34.
 Peter J. Boettke, Liya Palagashvili, and Jayme S. Lemke, “Riding in Cars with Boys: Elinor Ostrom’s Adventures with the Police,” Journal of Institutional Economics 9, no. 4 (2013): 407–425.
 Russell S. Sobel and Peter T Leeson. “The Use of Knowledge in Natural Disaster Relief Management,” Independent Review 11, (2007): 519–532.
 Derek Kauneckis, “The Polycentricity of Innovation: Explaining Variation in the New Role of States in Science and Technology Policy,” Workshop on the Workshop (WOW4). (Bloomington, IN, June 3–6, 2009).
 Irina Shklovski, Leysia Palen, and Jeannette Sutton, “Finding Community through Information and Communication Technology during Disaster Events,” CSCW’08. (San Diego, California, November 8–12, 2008), https://dl.acm.org/doi/pdf/10.1145/1460563.1460584.