The difference between a decentralized and centralized government lies in which people or institutions have authority. Centralized government features a few powerful institutions and executives. Power is delegated to more institutions in decentralized systems.
Centralization and decentralization are best understood as opposite ends of a spectrum. Most governments are a mix of one or the other. A dictatorship in which the ruler gives few subordinates authority to make decisions would be referred to as a highly centralized form of government. It's also impossible. Few people have the capacity to make all of the decisions that are needed to run a government. Authority is generally delegated to others. The more authority that is delegated, the more decentralized a government is. Authoritarian governments might feature subordinates tasked with running the army, security services and the judiciary who have a vast degree of autonomy but are nonetheless subordinate to a dictator. Decentralized governments might feature regional governments that have their own authority independent of a central government.
Pros and Cons
Centralized governments tend to exercise broad powers over their citizens and can respond quickly to external threats and internal emergencies. Because power is concentrated in centralized systems, it's easily abused. A centralized government may not have to answer for political decisions, like high taxation or unfair laws, and citizens have little power to change the form or decisions of government.
In a decentralized government, power is dispersed throughout the system. Decisions may take longer, but tend to involve multiple stakeholders and a larger portion of the populace. Decentralized governments tend to be accessible to the citizens, and the people voicing their opinions have a direct impact on the decision-making process. Decentralization has its downsides. It's harder to pass legislation over a disparate group of people with differing opinions. However, it allows much more transparency than a centralized government, and it works on a system of checks and balances. If one segment of the decentralized government becomes corrupt or ineffective, it can be ousted.
Examples of Centralized and Decentralized Governments
The Russian Federation is a good example of a centralized government. The president and prime minister have broad authority. Though the bicameral legislature features many political parties, it's generally weak and is dominated by a single party, which further underscores the power of the president and prime minister. The central government also exerts control over regional ones, as well as the judiciary.
Decentralized governments come in many forms. The federalism seen in the U.S., where state governments have authority that are separate from the federal government, and where local governments have areas of governance that are delegated from the state, is one form of decentralized government. The separation of powers, in which the executive, judiciary and legislature each have spheres of influence is also a form of decentralization. These are not, however, the only forms. Some countries feature semi-autonomous zones, such as Spain's Basque region and Hong Kong in China. Scholars tend to see decentralized governments as more stable, because they give minority groups more entry points into government. Decentralization can be a stabilizing factor in countries that have deep ethnic divisions as well.