October 27, 2016

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The other side of the development strategies

There is no single story that does not have two sides. Everything has the other side to be told. In the same vein, the concept of good governance in also discussed, debated and contested by scholars to unfold diversified aspects of the notion. Concerning good governance, one can roughly categorize three debates: the development strategies of the World Bank and IMF; the public sector reforms; and the issues of economic development.
The World Bank and the International Monetary Fund (IMF) are of the opinion that an active state ought to foster an environment in which contracts are enforced with markets being able to operate efficiently. According to the World Bank and IMF, a state ought to follow pro-growth macroeconomic policies like low inflation, moderate-sized government, sound financial development, enforcement of the rule of law, openness to international trade and raising average income with little impact upon the distribution of income (Dollar and Aart Kraay: 2002).
Nevertheless, the opponents of the development strategies reject the neoliberal assumptions underlying these strategies, arguing that the actual impacts of these strategies have been damaging. Some argue that IMF and The World Bank restrict the economic freedom of the recipient countries in a way that prevents them from adopting more viable growth strategies. Most often, the critics of these development strategies of the World Bank and IMF draw on alternative socio-economic theories to promote different development strategies.
The second debate is about the public sector reforms. Scholars argue that the initial impetus for public sector reform was based upon the belief that the state was too strong and too active. Nevertheless, the developing states often have the opposite problem – the state is too weak and inept. Public sector reforms are found to be restricting the scope of state activity, but the major hindrance to modernization in developing states is lack of the state strength. This being so, the reforms often proved to be improper to developing states. What is needed is to establish bureaucratic institutions with clear lines of accountability, unbiased, incorrupt public officials and abstract rules to guide them.
The third debate is about the relationship between the notion of good governance and the issue of economic development. The opponents to this assumption argue that good governance is not an absolute guarantor for economic growth and development. According to Jomo Kwame Sundaran (2012), corruption, lack of democracy and rule of law, market failures etc continue to be common features in many developing countries. In this juncture, S Woodward also argue that developmental policies need to address governments, considering the capacities and scopes of decision-makers. Such being the case, implementation of abstract concepts has to be grounded by taking into account regional, national and even local characteristics. Maybe, the opponents are against the suggestion that the developed western world is free of ills like political corruption (Quiles: 2013).

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