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Institutional Analysis and Development






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Institutional Analysis and Development. Mar. 17. 2009 David Bell Keng-Hao Hsu Sung-Geun Kim. Main Points of the Readings. How can we explain development in terms of two different theoretical positions? What has rational choice theory (or variations of it) contributed to the explanation?
Institutional Analysis and Development

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Institutional analysis and development l.jpgSlide 1

Institutional Analysis and Development

Mar. 17. 2009

David Bell

Keng-Hao Hsu

Sung-Geun Kim

Main points of the readings l.jpgSlide 2

Main Points of the Readings

  • How can we explain development in terms of two different theoretical positions?

    • What has rational choice theory (or variations of it) contributed to the explanation?

      • The Pitfalls of new political economy perspective

      • The possibilities of institutional analysis

    • What kind of new insight can the discourse analysis give?

      • The emancipatory ways of framing, naming, numbering, and coding

      • The "alternatives" should be found in the specific manifestations in concrete local settings

Golden oldies l.jpgSlide 3

Golden Oldies

Institutional Analysis and Development

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Definition of Institution Building

  • George F. Gant. (1966). The Institution Building Project. International Review of Administrative Sciences. Vol. 32, No. 3.

  • Institution: an educational or training and research agency

  • Technical assistance: assistance to a project to establish or strengthen an educational institution

  • Self-reliance in personnel capacity is primary objective

  • The first thing needed is full agreement between the host country and the aid agency on the importance and nature of the project

  • As there are diverse components in the process, such as staff, facilities, faculty, equipment, carefully prepared process of synthesis is important

Administrative responsibility for the project l.jpgSlide 5

Administrative responsibility for the project

  • Two questions should be answered before beginning the project

    • Who will pay the cost?

    • Who will be in charge?

  • Usually, the host country does not have enough resources to begin with, so for a specifically limited period, the aid agency can take charge of the project

  • However, without special conditions, the subject institution and the responsibility for developing it should be in the administrative charge of the host country from the outset

  • If aid agency 'makes' the institution, then institution building process ends when transfer of charge is finished

  • The most promising institution building project would be administered and financed for the most part by the host country

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Selection and training of staff

  • The most difficult problem for staffing is to choose the head of the new institution - But the problem generally comes up when a change occurs

  • Even though there is a problem, the aid agency should let the host country make the decision

  • The aid agency can provide foreign specialists as assistance, but the final objective should be to fill the position with native staffs

    • When the potential staffs are trained, the number should be more than needed because of some slippage and competitive environment

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Role of the foreign consultant

  • How foreign personnel can be positioned effectively?

  • The personnel's number, quality, and the length of their service is important

  • Also, the foreign personnel's personal sensitivity is also crucial

  • Orientation is important

    • The nature and process of the institution building process should be informed very well

    • Their identification with it and loyalty to it are essential to make the full utilization of their services possible

  • Physical arrangements for the foreign assistants can improve their engagement to the institution building process

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Role of the assisting university

  • Considering the formidable jobs of the aid agency, the involvement of university can give many advantages

    • As an institution, university can give essential information about how to make the components a working institution

    • Also, it is helpful for the university itself in terms of teaching and researching

  • However, their participation should be well-organized with the operation of the aid agency

Public choice theory l.jpgSlide 9

Public Choice Theory

  • Samuel L. Popkin, "Public Choice and Peasant Organization," in Bates, Toward a Political Economy of Development

  • Effort and Reward

    • Free rider

      • Individual interest V.S. group interest

      • Effective leadership

      • Coercion or some other special device

    • Political entrepreneur

      • Mechanisms for coordination of expectations and the pooling of resources

      • Keep the promise and the ability

        • Ability and credibility

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Public Choice Theory (cont.)

  • Information asymmetry

    • Quality

      • Collective wage labor and Tenancy system

        • Peasant- self enforcing

      • Market structure

        • Rice and Rubber

          • Rice markets are auction markets

          • Rubber markets are customer markets

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Development Theory and Discourse: IAD

  • Gunnar Myrdal. (1968). Corruption—Its Causes and Effects, Ch. 20, in Asian Drama.

    • Ideologies as a determinant of policies

    • Ideologies view in terms of both:

      • Content of ideals and ideas, and

      • An aspect of social reality from policies emerge and influence actual development

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Development Theory and Discourse: IAD

  • The “Folklore” of corruption—people’s beliefs about corruption and their related emotions

    • Discourse/conversation frequently turns to political scandals

      • It is believed that corruption is rampant, that it is growing—particularly among higher officials

      • The belief has a crucial bearing on how people conduct their private lives and how they view their government’s efforts to address corruption and spur development

        • Public outcry must be considered as a constructive force

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Development Theory and Discourse: IAD

  • Creating a “climate of corruption” causes people to be corrupt—“if everyone is doing it why not me?”

  • Though the “impressions are unfair and exaggerated” it is as damaging as the actual failure of integrity

  • Resistance to demands for bolder, more systematic efforts to cleanse government was out of fear of bolstering the “impressions”

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Development Theory and Discourse: IAD

  • Policy recommendations in response to an ideology/theory of rampant corruption:

    • Centralized authority and routinization

    • Low-paid civil servants should have remuneration and status raised

    • “Petty officials” bribes should be legalized into fees (Great Britain, Holland, Scandinavian countries model)

    • Laws and enforcement agencies should be strengthened

    • Policies implemented targeting the private sector corruption of public servants (e.g. corporation pay-offs for expedition, etc)

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Literary Map

Institutional Analysis and Development

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DEVELOPMENT

THEORY

Escobar

Rational Choice Theory

Discourse Analysis /

Policy Arguments

Gant

Popkin

Gasper & Apthorpe

New Political Economy

- Politics with the perspective of economics

Institutional Analysis

- Searching for the “parameters” of economic analysis

Myrdal

Picard & Garrity

Ostrom

Leys

Staniland

Synthesis l.jpgSlide 17

Synthesis

Institutional Analysis and Development

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How can we explain Development?

  • Rational Choice-centered approach

    • Some variations are needed (Popkin)

      • New Political Economy (Countered by Staniland, Leys)

      • Institutional Analysis (Gant, Picard & Garrity, Ostrom, Myrdal)

  • Discourse Analysis / Policy Argument-centered approach (Gasper & Apthorpe, Escobar)

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Rational Choice-centered Approach

  • Popkin suggests two problems of this approach – Adjustments are needed

    • Free rider

      • Individual interest V.S. group interest

      • Effective leadership

      • Coercion or some other special device

    • Political entrepreneur

      • Mechanisms for coordination of expectations and the pooling of resources

      • Keep the promise and the ability

      • Ability and credibility

New political economy cont l.jpgSlide 20

New Political Economy (cont.)

  • Staniland criticizes the basic assumptions of new political economy

    • The perspective is “simply the application of economics to political science”, seeing the political system itself as analogous to a market

      • It does not deny the existence of politics, but it assumes that political behavior and institutions can be analyzed as analogous to economic behavior and market institutions

    • The applications suggests both the biases and limits

      • The assumptions avoid questions which seem to many students of politics rather fundamental

      • It misses the "institutional richness" of political life - the very notion of "self-interest" is culture-bound, or is simply oblivious to culture

New political economy l.jpgSlide 21

New Political Economy

  • Leys explains the problems of the application of New Political Economy (NPE) perspective.

    • The perspective, though based on rationality assumption, is applied without any rational consideration – “Hobson’s choice”

      • Considering SAPs, what IMF showed was choices that do not have strong rationales.

    • It is necessary to examine the relevance of theories when they are applied.

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Institutional Analysis

  • Gant considers diverse aspects of institutional building

    • Administrative responsibility

    • Selection and training of staff

    • Role of foreign consultant

    • Role of assisting university

    • Self-reliance in personnel capacity is primary objective

    • As there are diverse components in the process, such as staff, facilities, faculty, equipment, carefully prepared process of synthesis is important

Institutional analysis cont l.jpgSlide 23

Institutional Analysis (Cont.)

  • Picard & Garrity explain through the lens of development in Africa that…

    • A balance of development responsibilities must be created for the institutions of the public, private, and nonprofit sectors

    • These institutions should be modified based on a realistic assessment of the abilities and limitations of the public sector

    • Institutional development must focus on sustainability factors in HR development, organizational development, and overall education and training strategies

Institutional analysis cont24 l.jpgSlide 24

Institutional Analysis (Cont.)

  • Picard & Garrity explain through the lens of development in Africa that…

    • Donor and recipients can be served by contracting-out mechanisms for institutional development so as to separate HR development from service delivery activities

    • Technical assistance with institutional development should be engaged at the intersection of the public and private and nonprofit sectors to address perceived interest conflicts as policy change will involve partnerships of these sectors

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Institutional Analysis (cont.)

  • Ostrom suggests a comprehensive frames of institutional analysis

    • The most important job is to find appropriate “parameters” of the institutions

    • The problem itself can be changed: it depends on the values of parameters such as the number of appropriators, the cost of monitoring…

    • The framework includes:

      • Internally: summary variables (benefits, costs, shared norms, and opportunities)

      • Externally: situational variables (information about shared norms / benefit and cost of change)

Institutional analysis cont26 l.jpgSlide 26

Institutional Analysis (cont.)

  • Myrdal points that the focus on ideologies is needed in order to understand institutions

    • Ideologies as a determinant of policies

    • Ideologies view in terms of both:

      • Content of ideals and ideas, and

      • An aspect of social reality from policies emerge and influence actual development

Discourse analysis policy argument centered approach cont l.jpgSlide 27

Discourse Analysis / Policy Argument-centered Approach(cont.)

  • Gasper & Apthorpe discuss what we should keep in mind when we apply discourse analysis.

    • The complexity and distinctiveness of policy discourse bring a strong need for more appropriate methods and advice in both specifying and assessing policy argument.

    • Problems of essentialism: it restricts more comprehensive and accurate explanation of development.

    • The emancipatory ways of framing, naming, numbering, and coding explored in the article offer possibilities for more open communication across ideologies, cultures, continents, and disciplines.

Discourse analysis policy argument centered approach l.jpgSlide 28

Discourse Analysis / Policy Argument-centered Approach

  • Escobar disclose “the third world and the politics of representation”

    • What has been done - the language of compensation as the only avenue of expression of outrage and injustice, which has linked development directly to economy of production and desire

    • The "alternatives" should be found in the specific manifestations in concrete local settings

      • Not necessarily new meaning - meanings that have to be read with new senses, tools, and theories

      • Deconstruction of development: "connection between truth and reality, words and things" - the task of conceptualizing alternatives must include a significant contact with those whose "alternatives" research is supposed to illuminate

References l.jpgSlide 29

References

  • Staniland, M. (1985). What is Political Economy? A Study of Social Theory and Underdevelopment. New Haven: Yale University Press.

  • Picard, L.A. & Garrity, M. (1994). Policy Reform for Sustainable Development in Africa: The Institutional Imperative. Boulder: Lynne Rienner.

  • Ostrom, E. (1990). Governing the Commons: The Evolution of Institutions for Collective Action. Cambridge: Cambridge University Press.

  • Myrdal, G. (1968). Asian Drama: An Inquiry into the Poverty of Nations, 3 volummes. New York: Pantheon.

  • Leys, C. (1996). The Rise and Fall of Development Theory. Bloomington: Indiana University Press.

  • Gant, G.F. (1966). The Institution Building Project. International Review of Administrative Sciences, vol. 32, no. 3, pp. 1-8.

  • Escobar, A. (1995). Encountering Development: The Making and Unmaking of the Third World. Princeton: Princeton University Press.

  • Gasper, D. & Apthorpe, R. (1996). Arguing Development Policy: Frames and Discourses. London: Frank Cass.

  • Popkin, S. L. (1988). Public Choice and Peasant Organization. In Bates, R. (eds.). Toward a Political Economy of Development. Berkeley: University of California Press.


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