SCIENTIFIC COUNCIL FOR GOVERNMENT POLICY Monique Kremer, Peter van Lieshout and Robert Went (eds.) Doing Good or Doing Better development policies in a globalizing world AMSTERDAM UNIVERSITY PRESS Doing Good or Doing Better The series ‘Verkenningen’ comprises studies commissioned by the wrr that are deemed to be of such quality and importance that their publication is desirable. Responsibility for the contents and views expressed therein remains that of the authors. Scientific Council for Government Policy (wrr) Lange Vijverberg 4-5 P.O. Box 20004 2500 EA The Hague Tel. + 31 70 356 46 00 Fax + 31 70 356 46 85 E-mail: [email protected] Internet: http://www.wrr.nl SCIENTIFIC COUNCIL FOR GOVERNMENT POLICY Doing Good or Doing Better development policies in a globalizing world Monique Kremer, Peter van Lieshout and Robert Went (eds.) Amsterdam University Press, Amsterdam 2009 Front cover illustration: © Teun Voeten Cover design: Studio Daniëls, The Hague Layout: Het Steen Typografie, Maarssen isbn 978 90 8964 107 6 e-isbn 978 90 8450 877 8 nur 754 © WRR / Amsterdam University Press, The Hague / Amsterdam 2009 All rights reserved. Without limiting the rights under copyright reserved above, no part of this book may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form or by any means (electronic, mechanical, photocopying, recor- ding or otherwise) without the written permission of both the copyright owner and the author of the book. 5 contents About the authors 9 Preface 13 1 Towards Development Policies Based on Lesson Learning: An Introduction 15 Monique Kremer, Peter van Lieshout and Robert Went 1.1 Paradigm shifts 16 1.2 Globalization 19 1.3 At the beginning of the 21st century: Elements for development policies based on lesson learning 22 PART I RETHINKING DEVELOPMENT 2 Twenty-first Century Globalization, Paradigm Shifts in Development 27 Jan Nederveen Pieterse 2.1 Twenty-first century globalization 27 2.2 Turning points 29 2.3 New development era 30 2.4 International development cooperation 40 3 Does Foreign Aid Work? 47 Roger C. Riddell 3.1 Introduction 47 3.2 What aid are we talking about? 48 3.3 Challenges in trying to assess the impact of aid 51 3.4 Does aid work? The evidence 54 3.5 Constraining aid’s greater impact and how these constraints might be addressed 65 3.6 Concluding comments: Aid and the wider perspective 70 PART II LEARNING FROM DEVELOPMENT HISTORIES 4 Under-explored Treasure Troves of Development Lessons: Lessons from the Histories of Small Rich European Countries 81 Ha-Joon Chang 4.1 Introduction: Lessons from history, or rather the ‘Secret History’ 81 6 doing good or doing better 4.2 Agriculture 86 4.3 Industrial development 89 4.4 Corporate governance and the concentration of economic power 95 4.5 Social and political factors 97 4.6 Concluding remarks 99 5 Stagnation in Africa: Disentangling Figures, Facts and Fiction 107 Paul Hoebink 5.1 Stagnation in sub-Saharan Africa 108 5.2 The low social development cause 111 5.3 The not-a-nation-state cause 113 5.4 The dependence on raw material exports cause 115 5.5 The greedy politicians cause 116 5.6 The weak states and weak policies cause 118 5.7 The Washington consensus cause 119 5.8 Other traps and curses 123 5.9 Conclusions and consequences 125 6 Including the Middle Classes? Latin American Social Policies after the Washington Consensus 137 Evelyne Huber 6.1 The isi period and the origins of social policy regimes 138 6.2 The debt crisis and the Washington consensus 139 6.3 Neoliberalism and its failures 140 6.4 Turn to the left and basic universalism? 144 6.5 The role of the middle classes 148 6.6 Lessons for development policy and external support 150 7 Imaginary Institutions: State-Building in Afghanistan 157 Martine van Bijlert 7.1 The Afghan state and the dynamics that affect it 158 7.2 The nature of the state-building effort in Afghanistan 163 7.3 How the ‘international community’ responds 165 7.4 Some concluding remarks 170 8 Beyond Development Orthodoxy: Chinese Lessons in Pragmatism and Institutional Change 177 Peter Ho 8.1 Buried under development? 177 8.2 On land and institutions 180 8.3 Chinese pragmatism: Colored cats or the demise of ideology? 183 8.4 Implications of Chinese development: Some concluding observations 193 contents 7 PART III BEYOND THE STATE: NEW ACTORS IN DEVELOPMENT 9 Business and Sustainable Development: From Passive Involvement to Active Partnerships 211 Rob van Tulder and Fabienne Fortanier 9.1 Introduction: from uniform to pluriform development thinking 211 9.2 From a traditional to a new development paradigm 213 9.3 From macro to micro: the role of multinationals in sustainable development 216 9.4 From general to specific: Strategic management of corporations and poverty alleviation 219 9.5 From passive to active: The search for partnerships 226 9.6 Conclusion: The challenges ahead 228 10 Why ‘Philanthrocapitalism’ Is Not the Answer: Private Initiatives and International Development 237 Michael Edwards 10.1 Private initiatives – what kind and how much? 239 10.2 ngo initiatives 241 10.3 Institutional philanthropy 244 10.4 Common problems: impact and accountability 248 10.5 Conclusions and implications for development policy 249 11 The Trouble with Participation: Assessing the New Aid Paradigm 255 Nadia Molenaers and Robrecht Renard 11.1 Participation: on the main menu or just a side dish? 255 11.2 What the new aid approach sets out to do: some background on the failure of aid 256 11.3 Flawed results 259 11.4 An overly optimistic notion of civil society 261 11.5 A biased vision on state-society interactions 262 11.6 A conditionality without ownership 266 11.7 When less is more 271 PART IV NEW INTERDEPENDENTIES 12 How Can Sub-Saharan Africa Turn the China-India Threat into an Opportunity? 279 Raphael Kaplinsky 12.1 Introduction 279 12.2 Development trajectories for Sub-Saharan Africa – three orthodoxies 280 12.3 The rise of the Asian Driver economies and their challenge to the three orthodoxies 282 8 doing good or doing better 12.4 The Asian Drivers and Sub-Saharan Africa – win-win or win-lose? 289 12.5 The policy response 292 12.6 Policy actors 297 13 Post-war Peace-building: What Role for International Organizations? 303 Chris van der Borgh 13.1 Introduction 303 13.2 Recipes for peace? 305 13.3 International capacity and coordination 308 13.4 Local capacity and international footprint 310 13.5 Conclusion 314 14 Migration and Development: Contested Consequences 321 Ronald Skeldon 14.1 Background 321 14.2 Conceptual issues 322 14.3 Patterns of migration 324 14.4 Approaches to migration and development 328 14.5 Conclusion 334 15 Global Justice and the State 341 Pieter Pekelharing 15.1 The rise of the concern for global justice 341 15.2 The birth of the notion of distributive justice 346 15.3 Balancing our loyalties. On the extension of justice into the international realm 349 15.4 It’s not ‘what can you do?’ but ‘what can your institutions do?’ 356 15.5 From cosmopolitanism back to the state: Rawls and the Law of Peoples 361 9 about the authors Jan Nederveen Pieterse is Mellichamp Professor in Global Studies and Sociology at the University of California, Santa Barbara. He specializes in globalization, development studies and cultural studies. He also works part time as professor in globalization at the University of Maastricht in the Netherlands. Recent books are Is there hope for Uncle Sam? Beyond the American bubble (2008), Ethnicities and Global Multiculture: Pants for an Octopus (2007), and Development Theory: Deconstructions/ Reconstructions (2001; second edition 2009). Roger Riddell has been actively involved in development aid for more than 30 years. From 1999 to 2004, he was the International Director of Christian Aid, one of the uk’s largest relief and development ngos. Riddell currently is a non- executive director of Oxford Policy Management. He published Does Foreign Aid Really Work? (2007), in which he examines official ngo and emergency/humani- tarian aid. Ha-Joon Chang is Reader in the Political Economy of Development at the University of Cambridge. Chang, originating from the Republic of Korea, is author of the worldwide successful books Kicking Away the Ladder: Development Stra- tegy in Historical Perspective (2002) and Bad Samaritans. Rich Nations, Poor Poli- cies and the Threat to the Developing World (2007). Paul Hoebink is Professor in Development Cooperation at the Centre for Interna- tional Developments Issues Nijmegen (cidin) of the University of Nijmegen. He focuses on European and Dutch development policy, the management of develop- ment cooperation and the effectiveness of aid. Evelyne Huber is Professor of Political Science and Chair of the Department at the University of North Carolina at Chapel Hill. Her interests are in comparative politics and political economy, with an area focus mainly on Latin America and the Caribbean. Her book Development and Crisis of the Welfare State: Parties and Policies in Global Markets (2001) won the Best Book Award 2001 from the Political Economy Section of the American Political Science Association. Huber was the editor of Models of Capitalism: Lessons for Latin America (2002). Martine van Bijlert is Co-Director of the Afghanistan Analysts Network. She served as Political Adviser to the European Union’s Special Representative for Afghanistan from 2004 to 2009 and has worked as an independent consultant on Afghanistan since 2007, providing political analysis in the fields of governance and institution building, insurgency and tribal politics, and democratization in (post-)conflict societies.