In this Seminar, Dr. Vijayendra Rao discusses the World Bank Policy Research Report, "Localizing Development: Does Participation Work?" a subject of intense debate and advocacy, and billions of dollars in development aid. Dr. Rao will briefly review the history of participatory development and argue that its two modalities, community-based development and local decentralization, should be treated under the broader unifying umbrella of local development. He will compare organic participation (endogenous efforts by civic activists to bring about change) and induced participation (large-scale efforts to engineer participation at the local level via projects) and focus on the challenges of inducing participation. Dr. Rao will discuss "civil society failure" and explain its interaction with government and market failures. He argues that participatory development, which is often viewed as a mechanism for bypassing market and government failures by 'harnessing' civic capacity, ought to be seen instead as a mechanism that, if done right, could help to repair important civil society failures. His review of the evidence looks at a variety of issues: the impact of participatory projects on inclusion, civic capacity, and social cohesion; on key development outcomes, such as income, poverty, and inequality; on public service delivery; and on the quality of local public goods. He draws on the evidence to suggest several recommendations for policy, emphasizing the key role of learning-by-doing and in creating effective monitoring and evaluation systems that allow for learning.