PSA 2017 Presentation by Sam Hickey

1. How does politics shape development?
The role of incentives, ideas and coalitions
PSA Annual Conference, 10 April 2017, Glasgow
Sam Hickey
Research Director,
Effective States and Inclusive Development Research Centre
Global Development Institute, University of Manchester
www.effective-states.org

2. How does politics shape developmental forms
of state capacity and elite commitment?
 Consensus that capacity and commitment matter,
and that they are largely shaped by politics
 But which forms of politics and how?
 Large variations between and within countries
 Problems with existing explanations
 Changes in development progress in relatively short time
frames across countries with similar initial conditions or
long run determinants of state capacity (geography, wars,
ethnic diversity, etc.).

3. ‘It’s the politics, stupid’

4. Three Core Variables
1. The Political Settlement
– “…the balance or distribution of power between
contending social groups and social classes, on which any
state is based.” (di John & Putzel)
2. Ideas/Beliefs: from paradigms to policy solutions
3. The Policy Domain

5. The Political Settlement
 Elite bargaining: central to political settlements
– Elites agree to centralise violence
– Establish institutions that align the distribution of
benefits with the underlying distribution of power
(Khan 2010)
 Elite bargains: personalised deals not impersonal
rules/organisations (North, Wallis, Weingast 2009)
 Shapes the capacity of the state to act; establishes
incentives for elites behaviour

6. Two Types of Political Settlements
1) Dominant: Concentration of power in one dominant
political group of elites; strong (Ethiopia, Rwanda) versus
weak (Uganda)
2) Competitive: Power is dispersed across several political
elites jockeying for political control (Bangladesh, Ghana)
• In Dominant Settlements, elites can develop long time
horizons and capabilities to enforce institutions.
• In Competitive Settlements; elites tend to have short
time horizons and have to resort to clientelist
distribution of resources to buy political support.

7. INSTITUTIONS 
POWER 
Personalized bargain Impersonal rules
Dominant party/leader
settlements
RWANDA
ETHIOPIA
UGANDA
Competitive settlements
BANGLADESH
KENYA
ZAMBIA

8. Ideas matter
Three main types of ideas:
i) policy ideas: provide potential solutions to pre-defined
social problems;
ii) problem definitions provide ways of framing particular
social issues; favours certain types of policy solution and
forecloses others
iii) overarching paradigms that serve as road maps, providing
‘a relatively coherent set of assumptions about the
functioning of economic, social and political institutions’
(Béland 2005: 8, Schmidt 2008).

9. The politics of policy domains
• Policy domain: a meso-level social field where actors
advance (competing) agendas
Domain features:
1. Political capture/autonomy from ruling coalition
• Does the domain offer rents and/or legitimacy?
2. Availability of shared frames (policy problems &
solutions)
3. Policy entrepreneurship/agency (range of actors)
4. Policy legacies
5. Governance arrangements

10. ESID framework: ‘domains of power’
POLITICAL
SETTLEMENT
Power relations and
modes of power; ruling
coalition; shaped by
material incentives and
paradigmatic ideas;
dynamic
POLICY
DOMAIN
Political role; ideas and
actors; policy legacies;
governance
arrangements
ELITE COMMITMENT
STATE CAPACITY
ECONOMIC STRUCTURE, HISTORY, NORMS
POLICIES AND DEVELOPMENTAL OUTCOMES

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Political
settlement
Competitive clientelist Dominant coalition
Country Ghana Bangladesh Rwanda Uganda
Accumulat-
ion
Growth & state-
business
relations
Growth/
SBRs
Growth/SBRs Growth/SBRs
” Oil governance Oil governance
Redistribut-
ion
Education
Health
Education
Health
Education
Health
Social protection
Education
Health
Social protection
Recognition Gender equity Gender
equity
Gender equity Gender equity
Global Public sector
reform
Public sector
reform
Public sector reform

12. Pockets of bureaucratic effectiveness:
from ‘what works’ to the politics of order,
state-building and democracy

13. Oil governance in Ghana and Uganda

14. Ghana Uganda
Development $1,570 GDP per capita $500 GDP per capita
Democracy
(Polity IV, ‘06)
Democratic: 8 Polity IV Semi-authoritarian:-1 Polity IV
Governance
indicators
(WGI, 2006)
Voice & Acctbty: 0.37
Govt effectiveness: 0.11
Rule of Law: 0.00
Control of Corruption:0.02
Voice & Acctbty: -0.42
Govt effectiveness: -0.48
Rule of Law: -0.34
Control of Corruption: -0.75
Historical
institutionalis
m
British colonialism; indirect rule
Partly centralized:
(0.65 - Gennaioli and Rainer 2007)
British colonialism; indirect rule
Partly centralized:
(0.63 - Gennaioli and Rainer 2007)
Geography &
Demography
Tropical climate; access to coast
Ethnically diverse:
(0.85 - Fearon 2003)
Tropical climate; landlocked
Ethnically diverse:
(0.93 - Fearon 2003)

15. Comparative findings
Ghana (competitive) Uganda (weak dominant)
Ruling coalition Short-term horizons (rush to first
oil)
Longer-term vision
Political
institutions
Early deals before legislation;
legal provisions on borrowing
overturned
Legislation before main deals
State capacity Deals: average
Oil technocracy: capacity
undermined by party politicking,
limited autonomy
Deals: strong
Oil technocracy: high capacity,
embedded autonomy (PoE),
strong support from ‘patriotic’
President

16. ‘that level of spending (for the 2011 elections) was
catastrophic to the economy and it will not happen this
time’ (Governor BoU, November 2014)

17. PoEs and the art of PS maintenance
• 2011: the bought elections
– Loss of central bank autonomy threatens the
political settlement (protests, politico-techno deal,
transnational legitimacy)
• 2016:
– BoU fights rearguard action, regains autonomy
– Fiscal indiscipline; other PoEs undermined to
ensure electoral victory
• PoEs at the intersection of state-building,
political survival & democracy (more to come)

18. Theoretical implications
• From ‘inclusive institutions’ (Acemoglu and Robinson
2012) to the interplay of political order, democratic
accountability and bureaucratic capacity over time
(Fukuyama 2016)?
• PSPD/’domains of power’
– A mid-range theory for explaining capacity and
commitment within proximate timeframes
– Complements/nuances theories of long-run development
• From politics to power

19. Strategic implications
• Two main development trajectories
– Dominant: elite cohesion & vision, enforcement
– Competitive: multi-stakeholder coalitions
overcome dysfunctional tendencies created by a
fragmented elite/politicised bureaucracy
– Offer different entry points and require different
strategies of engagement
• From ‘good’ to ‘good enough governance’
– State capacity as critical, including through PoEs
– Coalitions for change
– Institutionalise political economy analysis

20. Can donors do development differently?
• Brokers, arms-length, problem-solving, risk-taking…
• …but are donors fit for purpose?
• Competing pressures
– Domestic pressures vs. GWTG, long-timeframes
– Pressure to disburse vs. PEA
– VFM/RBM vs. risk-taking
– Posting cycles and accountability reporting vs.
Deep contextual knowledge
– Challenges from beyond aid (security, trade, tax…)