Cambridge, MA – Harvard’s Center for International Development hosted its eleventh annual Global Empowerment Meeting (GEM) on April 9-10, 2019 at the John F. Kennedy School of Government. This year, the coevolution of state capability and a society’s economic development was at the core of the debate. Drawing on ideas from cutting-edge academic thinkers – from Francis Fukuyama and James Robinson to experienced practitioners such as Senegal’s Aminata Touré and Albania’s Arben Ahmetaj – we learned about the relevance of institutional effectiveness to a country’s economic development and discussed the challenges of achieving such effectiveness while facing complex issues on the ground.
THE COEVOLUTION OF STATE CAPABILITY AND ECONOMIC DEVELOPMENT
CID Director Ricardo Hausmann set the stage for this year’s event by introducing the idea that the strongest predictor of government structure is the structure of the economy. He argued that it is therefore crucial to understand how to promote state capability as a way to encourage economic development. Hausmann then referred back to previous GEMs, where he talked about how knowhow is the basis of an economically diverse and complex society and he discussed ways to foster knowledge transfer in the private sector. But, given that most of these activities, such as FDI and migration, cannot be applied to the public sector, the question becomes: how can governments acquire the knowhow to develop new capabilities?
THE DIMENSIONS OF DEVELOPMENT
Francis Fukuyama presented a framework for thinking about the complex phenomenon of economic development by outlining six intertwining dimensions of development: economic growth, social mobilization, legitimacy, the state, rule of law, and democracy. While modern development theory suggests that all six of these dimensions are equally supported, Fukuyama argues that development can also occur in any of these dimensions separately (e.g. China has a strong state but no rule of law). He then outlined cases in which these dimensions are contradicted, such as strong states that violate human rights or democratic societies with poor rule of law.
THE BALANCE OF POWER: STATES, SOCIETIES, AND THE NARROW CORRIDOR TO LIBERTY
James Robinson shed light on the balance of power between the state and society, and its implications for answering current questions in development. Robinson argued that economically successful societies are a consequence of an inclusive political process, which comprises two key elements: a capable state and a broad distribution of political power. He illustrated his argument by first describing the emergence of western European democracies, which were formed precisely by a combination of these two elements. He then presented the case of China, in which the state has historically dominated society and public participation, and therefore accountability has been weak. For Robinson, the Chinese model is inherently limited, as he believes that the state is more powerful when society is more powerful.
THE BIG "STUCK" IN STATE CAPABILITY: WHAT EXPLAINS WHY STATES ARE NOT EFFECTIVE IN THEIR FUNCTIONS
Developing countries are often stuck in a trap of low capabilities and they struggle to get "unstuck," often due to premature load bearing. This occurs when institutions are asked to perform tasks before they are capable of doing these tasks well. Adnan Khan explained that when faced with complex issues, institutions tend to import external best practices. He argued that those are not only often ineffective, but they can undermine state capacity and can add more stress to an already overwhelmed structure.
Lant Pritchett built on that notion and illustrated how applying best practices into an unprepared context undermines the local political and economic structure. Pritchett also argued that the main actors that propagate "big stucks" are global consultants and developing agencies that insist on resorting to foreign pre-packaged solutions without taking local constraints into account.
Lant Pritchett - Watch Presentation | View Slides
Adnan Khan - Watch Presentation | View Slides
Q&A with Lant Pritchett, Adnan Khan, and Asim Khwaja
STORIES FROM THE STATE: WHAT HISTORICAL FACTORS HAVE SHAPED THE UNIQUE PATHS OF STATE FORMATION?
States, as we know them today, are the result of an evolution in capability and form. While there is no single narrative of how the state came to be, understanding the historical underpinnings of state formation can help us tackle the challenge of building institutional capacity. Daniel Ziblatt journeyed through the history of states, describing how western European societies democratized, each country following its own path but off of the same common ground. He described the origins of political parties and their role in the formation of modern democracies and posed the question of whether today’s democratic societies could have survived without those parties.
Maya Tudor took us east, inviting us to compare two countries that have largely similar economic and colonial roots but that evolved quite differently over the past decades: India and Pakistan. She made the case that state capacity and differences in the power structure of each country played a key role in their economic outcomes after independence.
Daniel Ziblatt - Watch Presentation | View Slides
Maya Tudor - Watch Presentation | View Slides
Q&A with Daniel Ziblatt, Maya Tudor, and Nathan Nunn
BEYOND "WEAK" AND "STRONG": WHY STATES FAIL AT PROVIDING SECURITY
The most violent places in the world today are not at war. Rather, they are struggling under a maelstrom of competing gangs, organized crime, political conflict, and state brutality. Rachel Kleinfeld walked us along two roads that can lead to a violent society: one is grounded in a “weak” state, where a government holds the monopoly of force but is unable to guarantee public safety. The other is grounded on what she calls “privileged violence,” where politicians ally with non-state violent groups to gain or maintain political power. Kleinfeld then described what a road out of violence could look like, for example by building on state legitimacy and promoting the strength of civil society.
BUILDING STATE CAPABILITY: HOW CAN GOVERNMENTS BETTER IMPLEMENT POLICIES?
One of the fundamental reasons why governments fail to implement public policies is that they are stuck in a capability trap. Adopting foreign best-practice solutions often impedes the process of learning and finding solutions that fit local contexts. Jorrit de Jong talked about the Bloomberg Harvard City Leadership Initiative: a program that aims to advance effective local problem-solving by fostering leadership as well as collaborative and analytic capabilities.
Matt Andrews presented two ways of measuring success in politics: the first being successful implementation of new programs or reforms and the second being actually solving the problem. Research shows that more often than not, institutions are more focused on the former rather than on the latter. Andrews made a case for a more empowering approach, one focused on understanding the problem and on enabling policymakers to think about locally-led solutions.
TURNING IT AROUND: STORIES FROM THE POLICY BATTLEGROUND
Governments in developing countries often face challenges such as low-capability institutions, weak rule of law, and daunting economic challenges. How can policymakers overcome such challenges and turn things around? Arben Ahmetaj presented the case of Albania, describing the country’s path to macroeconomic stability, administrative consolidation, and sustainable growth.
Aminata Touré shared Senegal’s journey towards a fair and accessible justice system and the importance of deeply understanding the context and engaging with local stakeholders to craft a system that really works for the people.
Arvind Subramanian discussed India, where he advised on a nation-wide tax reform. He described the complexity of implementing a reform in a highly heterogeneous and extensive country, while navigating a very complex political system.