Lecture 6: Why Good Policies Aren't Implemented

Question 1

Summarize how development policies fail

Answer 1

Institutional rules create incentives for development, but are often not enforced in practice due to a weak or predatory state or unhelpful informal institutions that are produced by history and geography

Question 2

How can we promote development? 3 points

Answer 2

1. More inclusive formal institutions to encourage investment
2. More supportive informal institutions that encourage enforcement and compliance
3. More capable states with embedded autonomy (security, meriticracy, organized business associations)

Question 3

Definition: Good Governance

Answer 3

Good governance is ensuring respect for human rights and the rule of law; strengthening democracy; promoting transparency and capacity in public administration

Question 4

Most development agencies try to promote

Answer 4

Good governance

Question 5

8 policies of good governance

Answer 5

1. Participation
2. Rule of law
3. Consensus
4. Equity and inclusiveness
5. Effectiveness and efficiency
6. Accountability
7. Transparency
8. Responsiveness

Question 6

How is good governance a capability trap - 4 points?

Answer 6

1. Can create unrealistic expectations for what the state can achieve in terms of implementation
2. Can be misunderstood as a technical fix, leading to ignoring the political issues of governance
3. Can divert attention and resources away from other important areas, such as the ability to implement policies and deliver services effectively
4. Would take a few hundred years for developing countries to catch up to the West through good governance

Question 7

In what 6 ways did Nigeria’s vision 2020 try to implement good governance measures?

Answer 7

Did many things, among others:
1. Increased investment in critical infrastructure
2. Enforce mandatory basic education
3. Entrenchment of merit
4. Strengthening anti-corruption institutions
5. Diversification away from oil
6. Enforcement of a code of values and ethics for public servants

Question 8

Did Nigeria’s vision 2020 actually meet any of its goals?

Answer 8

No - not in GDP, corruption ranking, literacy and power generation

Question 9

Why are development initiatives (like Nigeria’s vision 2020) still failing? 4 points

Answer 9

1. The rules are being ignored by politicians
2. The rules are being imported by international donors
3. The rules are being broken by corruption and clientelism
4. The rules are being resisted by vested interests and identities

Question 10

3 factors of: the rules are being ignored by politicians

Answer 10

1. Good governance is too demanding
2. Form is prioritized over function (isomorphic mimicry)
3. Not enforcing wins votes (forbearance)

Question 11

How can good governance be too demanding?

Answer 11

1. Good governance policies are overwhelming
2. WB and IMF agenda has 116 items - How can you address all points at once? How do you prioritize?

Question 12

3 reasons why improving good governance is hard

Answer 12

1. Limited time, attention and resources
2. Premature load bearing: capacity is already limited in developing countries so doing everything means doing nothing
3. These governance institutions are the result, not the cause of development (good governance followed development in Western countries, once they could afford it)

Question 13

3 characteristics of Good Enough Governance

Answer 13

1. Priroitize crucial reforms
2. Understand the optimal sequencing
3. Prioritize poverty reduction

Question 14

3 criticisms of Good Enough Governance

Answer 14

1. Is it compatible with Sen’s argument that all freedoms are important and complementary?
2. Is short-term poverty reduction historically how countries developed? (no)
3. Shouldn’t countries be allowed to prioritize themselves?

Question 15

Definition: Isomorphic mimicry

Answer 15

Copying institutional rules that are perceived to have promoted development elsewhere

Question 16

Modernization theory and isomorphic mimicry

Answer 16

Copying ‘modern’ organizational forms creates development

Question 17

5 Criticisms of modernization theory’s encouragement of mimicry

Answer 17

1. Assumes that institutions work the same in any context
2. Ignores differences in history, culture, and state capacity
3. Ignores how the institution came to be
4. Ignores the local legitimacy of the institution
5. Ignores whether these institutions really mattered for development

Question 18

Why does more monitoring and evaluation fail to get teachers to turn up at school?

Answer 18

Qualified teachers live in urban areas and are employed at rural schools. They rely on unreliable public transportation and childcare

Question 19

What did Nigeria’s vision 2020 try to mimic?

Answer 19

Singapore’s good governance program - they were trying to satisfy specific key indicators, but lost focus of developing the country as a whole

Question 20

2 reasons why isomoprhic mimicry continues despite being unsuccessful in promoting development

Answer 20

1. Important ‘Western’ institutions provides domestic legitimacy to bureaucrats and politicians because they can point to the Rich West. They use it as an alternative to performance legitimacy and as a ‘window dressing’ institution as they cannot be blamed when something goes wrong
2. Western donors have a bias to export ‘modern’, technical solutions because they are less controversial than political missions, and local experimentation is risky and hard to evaluate

Question 21

Definition: Forbearance

Answer 21

Intentionally choosing not to enforce the rules/laws

Question 22

Why do politicians choose forbearance?

Answer 22

While institutional rules provide incentives for investment, they also redistribute wealth and opportunities, and ignoring these rules can redistribute large benefits to the poor (e.g. banning street sellers would only redistribute wealth to the already better off shop owners, so they ignore property rights protection)

Question 23

What are the costs of forbearance?

Answer 23

Reducing the incentives to invest because the rules are not enforced - shop owners will not invest in making their shop better, and street sellers will not invest in a shop because they can sell on the street

Question 24

What can either enforcing or forbearance send a signal about?

Answer 24

Whether you are anti-poor (enforcing) or pro-poor (forbearance)

Question 25

2 instances when governments choose forbearance instead of enforcement

Answer 25

1. Where governing politicians depend on poor voters
2. Where alternative social welfare programs are weak
   E.g. it can be politically valuable for politicians to not enforce when they rely on votes from the poor

Question 26

2 instances when governments choose enforcement instead of forbearance

Answer 26

1. When they rely on middle-class voters and shopkeepers
2. When they can claim credit for solving social problems like congestion and crime