by Ranissa Adityavarman
It is a truth universally acknowledged that donors in possession of a good fortune must be in want of some institutional transformation. In “Aid, Institutions and Governance: What Have We Learned,” David Booth explicitly explains the key lessons that scholars and technocrats alike have learned regarding the so-called best practices surrounding aid and institutions. Booth aptly encompasses a large body of literature on the subject in the piece, which results in its resemblance to an extended literature review – the paper is much more descriptive than prescriptive. Nevertheless, his piece is fairly helpful in summarizing the main literature vis-à-vis three key subject areas: the transformation of institutional theory; aid, governance, and ownership; and terms on which donors can contribute to the facilitation of institutional change.
THEORY OF INSTITUTIONS
In the first area – the transformation of how scholars perceive institutions and their relative importance to other things like policy – Booth is refreshingly frank. He states, “to an important degree…we do not know what the ‘right’ institutions are” (57). This uncertainty, paired with his argument that institutions cannot be divorced from their political contexts, are the most important takeaways from this section of the literature. In many ways, it is an admission to how much institutional reform cannot be summarized neatly by scholars as a whole – the most successful changes have deep understandings of political underpinnings. Indeed, “the institutions that the institutions that are good for obtaining growth and reducing poverty in the poorest countries may be quite different from the ‘best practice’ arrangements that have proven their worth in moving forward from middle-income starting-point” (57). Thus, the assertion that institutions ‘rule,’ and that institutions are more helpful in explaining GDP growth than other indices, like geography or level of economic integration, rings true in Booth’s school of thought.
The second portion of the piece describes the relative strengths and weaknesses associated with aid policy approaches. Two important conclusions from this part of the literature are the failure of results-based disbursement and “revealed inability of policy conditionality to secure commitment by the governments of aid-recipient countries to poverty-reduction goals and the steps required to achieve them” (S13). That is, institutional change does not occur when aid is based on granting rewards or withholding rewards for certain ‘good’ behavior. Recognizing the limits to donor leverage, strategically allowing greater freedom for governments to develop internal plans of reform, and efforts to increase investments in understanding “in-country political institutions and processes” (S16) were among the most important takeaways regarding aid, governance, and ownership of the responsibilities of reform. Notably, the difference in regime change among countries – and how quickly administrations change hand—is an interesting aspect of reform ownership which I had not yet deeply considered before reading Booth’s piece.
RESULTS OF AID
The final section discusses the ways in which donors have or have not facilitated institutional change based on the circumstances and method of their aid. The theme of more politically informed, context-specific approaches is, of course, discussed at some length in this section. While Booth argues for the humility of aid donors and foreign influences, he also asserts “with only a few exceptions, development is ‘unlikely to take place without external change agents, given the absence of a domestic political coalition that supports rapid development’” (S20). In this way, he emphasizes the need for external funders but also calls for them to “back off” and allow space for more localized reform to take place. His own opinion on the matter is never fully made clear.
Therein lies my main criticism of Booth’s paper. I acknowledged at the onset that I recognize his review is more descriptive than prescriptive, but there was certainly space for more of his original analysis and polemic thought. As I just pointed out in the previous section, his opinion on these matters are never made fully clear, other than the fact that he believes institutions are central to reform, that policy changes should be context specific, etc. He himself writes that the literature is lacking concrete do’s and don’ts that go beyond “general injunctions” about risks and waste (S19). Thus, a peculiar tension arises: for him not to point out unique, actionable reform steps moving forward while concluding that there is a void in the literature in doing just that. Of course, this could be due to a fear of falling into universal prescriptions (which is fair) but I had hoped to see a more nuanced recommendation – even if limited to only a specific region or country—in the end. For example, his discussion on the government turnovers between African and Latin American states was the most helpful illustration of how institutional reform must be different depending on regime shape; I had hoped to see more in the final section.