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In economics, centralization involves allocating someone (or a company) to be wholly responsible for certain tasks. For example, allocation of bread in centralized economies.

Decentralisation is taking power away from the person/company who is supposed to perform these tasks, and allowing free-market economies to form.

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Q: Difference between centralization and decentralization
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Difference between centralisation and decentralisation?

Centralization and decentralization are both management systems. In centralization the decisions are made in a central location or central person. In decentralization the authority is delegated throughout the organization.


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There are many circumstances where centralization is much better than decentralization. This is the case when housing people very efficiently.


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Centralization is the concentration of decision-making authority at the top levels of an organization, leading to a hierarchical structure. Decentralization, on the other hand, involves distributing decision-making authority to lower levels within the organization, empowering employees and offering more flexibility. The choice between centralization and decentralization often depends on factors such as the organization's size, industry, and objectives.


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The opposite of centralization is decentralization. While centralization refers to consolidating power or control in a central authority or organization, decentralization disperses power, decision-making, or authority to multiple individuals or local units. Decentralization promotes autonomy and local decision-making.


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