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Developmental States, Effective States and Poverty Reduction: The Primacy of Politics (Draft)
A series of prevailing errors in much developmental theory and practice, on left and right, has characterized much of our thinking over the last 40 years, with each error somehow compounding the others. Such errors include the following: that "socialism" in poor countries can be built without industrialization; that "capitalist" development will reduce poverty when markets are given their freedom; that industrialization is possible without an effective and involved state; that building such a state is largely a top-down and technical process of institution-building; that developmental states and state-led development is possible in all contemporary states; and that the reduction of poverty is a matter of steering enough of the right resources to the right places and the right people.
At the root of most of these errors has been our failure to recognize the centrality, if not the primacy, of politics, of political processes – both internal and external, and their interaction – in shaping state goals, capacity and developmental outcomes. The challenge for policy-oriented research is thus not simply to explore the profoundly difficult problems of state-building or the design and funding of welfare regimes, but how to identify, support and encourage the political forces and coalitions which alone will create and sustain the institutional arrangements of effective states (at least, and preferably developmental states) dedicated to both growth and poverty reduction, whether democratic or not.
Poverty reduction and general improvement in welfare, in short, is not simply a matter of enhancing aid flows, designing appropriate policy regimes and supporting institutional development. For we have seen that very different policy regimes and institutional set-ups in diverse socio-economic contexts can promote poverty reduction, as the very different cases of Uganda, Viet Nam, Mauritius, the Republic of Korea and Cuba all illustrate. Poverty reduction is a matter of politics. But where the politics are not equal to the task it is, first and foremost, a matter for donors to identify, nurture, encourage and support those social and political forces which are necessary for forming the kinds of growth coalition which will demand, design and implement the institutional arrangements which will deliver pro-poor growth and social provision.
This paper elaborates, first, what is to be meant by politics here and goes on to suggest that the politics of growth and development is a special and difficult kind of politics, most dramatically reflected in what have come to be called developmental states. It suggests that only effective states and preferably development ones – whether democratic or not – are capable of elaborating the institutions which will establish poverty reducing growth and associated welfare regimes. But it also argues that building such states cannot be had to order and that their evolution will depend on the political processes that have everywhere and always established them. Current anti-statist and pro-market orthodoxies, though somewhat on the decline, and pro-democratic concerns, do not make building effective development states a straightforward matter. The paper concludes by suggesting that the challenge for donors is a difficult one, but that it is time to start thinking how they move into new areas of assistance and aid so as to be able to invest in, and support, the political processes which contribute towards the negotiated construction of effective developmental states.