Like many countries in Africa, Tanzania has been striving to institutionalize local democracy through local government reforms. The central objective of these reforms is to escalate people centered development in which citizens participate in the process of planning and decision making with respect to allocation of resources. Despite this initiative, three contradictions still exist: First of all, the central government still retains the power of decision making with respect to allocation of resources. Second, the design of local democratic institutions themselves hinder its performance. Third, apart from the design of local democratic institutions, the skills capacity of politically elected representatives also determine their performance. So far the main stream of literature on local democracy focus on limited decentralization as an obstacle to the performance of local democracy and there is little information on how other institutional designs at local level and the skills capacity of local politicians obstruct the performance of local democratic organization in Tanzania. This raises a question on how institutional design at local government level hinders the performance of local democracy in Tanzania, and what factors play a role. In doing this, the research involved the desk review of theoretical and empirical literature from the world wide experience and specifically to Tanzania. The review indicate that apart from limited decentralization, some other institutional designs like the existence of parallel institutions ,ward systems in which councilors are elected from each ward and the skills capacity of councilors determine the performance of local democracy
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