Economic Expertise, Power, and Global Development Finance Reform
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Politics by Other Means: Economic Expertise, Power, and Global Development Finance Reform Jigar D. Bhatt Submitted in partial fulfillment of the requirements for the degree of Doctor of Philosophy under the Executive Committee of the Graduate School of Arts and Sciences COLUMBIA UNIVERSITY 2018 © 2018 Jigar D. Bhatt All rights reserved ABSTRACT Politics by Other Means: Economic Expertise, Power, and Global Development Finance Reform Jigar D. Bhatt This dissertation investigates how economic expertise influences development governance by examining how state economists establish methods for decision-making in global development finance. It contributes to debates over expert power by taking a science studies approach to address two problems in existing theories and accounts of experts. First, social reformers, heterodox planning theorists, and development critics from both the left and the right treat rationality and politics asymmetrically. When experts fail, politics has triumphed. When experts succeed, the credit goes to rationality, not politics. Second, within this asymmetrical approach, investigations and explanations of expert power neglect a principal conduit of expert influence: their methods. This dissertation turns the focus to economists’ efforts to establish their methods as governing rationales and the effects these methods engender. Doing so allows us to approach particular forms of state rationality such as neoliberalism or managerialism not as processes of depoliticization, of intellectual rationality prevailing over political interests and values, but as explicit political accomplishments with both the power to bring about political effects and the susceptibility to being challenged. State economists’ efforts to establish three paradigmatic development economic methods in particular—governance indicators, growth diagnostics, and randomized controlled trials—and these methods’ effects on power relations, decision-making, and the distribution of resources were assessed using an embedded case study design of their use for decision-making in administering a new development finance fund, the United States Millennium Challenge Account. A mixed methods approach using interviews, documents, and various datasets found that economists could not realize the power of their intellectual rationality without exercising power thought to be the reserve of politicos. Economists had to employ various strategies of power both to gain autonomy from bureaucratic authorities and overcome opposition from expert groups holding alternative rationalities. This involved enrolling bystanders and opponents in their entrepreneurial efforts to establish methods. The more opposition economists faced, the more power they had to exercise and allies they had to enroll. Once enrollment was successful, economists’ status was elevated and their methods became indispensable to particular decision- making processes. These new ways of making decisions introduced different biases that elevated economists’ concerns, objectives, and ways of knowing. They also impacted the distribution of development finance in ways that exacerbated inequality in at least the short to medium term. This dissertation’s focus on economists’ political work and methods has implications for planning practice because it opens up new political possibilities. Rather than treating state expertise and public participation as antagonistic, zero-sum confrontations, planners can pursue democratic values by both “opening up the state” and “getting inside” methods. If orthodox economists had to overcome opposition from groups of opposing experts with competing rationalities then other experts can likewise use political strategies to establish their methods as governing rationales. Even in situations where this is not possible or desirable, understanding methods’ political effects can instigate reflective practice and possible change. Table of Contents List of Tables ................................................................................................................................ ii List of Figures ............................................................................................................................... v List of Acronyms ....................................................................................................................... viii Acknowledgements ...................................................................................................................... xi Chapter 1: A Science Studies Approach to Expertise in the State ................................................ 1 Chapter 2: Major Debates over the Power of Experts ................................................................ 22 Chapter 3: Research Approach and Methodology ..................................................................... 47 Chapter 4: The Power of Governance Indicators in Global Development Policy ...................... 70 Chapter 5: The Power of Growth Diagnostics in Development Planning ................................ 144 Chapter 6: The Power of Randomized Controlled Trials in Development Projects ................. 213 Chapter 7: The Power of State Expertise .................................................................................. 281 Chapter 8: Economic Expertise, Development Governance, and Planning Practice ................ 323 Works Cited .............................................................................................................................. 341 Appendix A: List of Interviewees ............................................................................................. 377 Appendix B: Tables and Figures for Governance Indicators Chapter ...................................... 380 Appendix C: Tables and Figures for Growth Diagnostics Chapter .......................................... 382 Appendix D: Tables and Figures for Randomized Controlled Trials Chapter ......................... 389 i List of Tables Table 3.1: Sample Frame, Target Interviews, and Number of Respondents ............................... 60 Table 3.2: Secondary Data Sources, Including Dataset Sources ................................................. 61 Table 3.3: Public Events Attended ............................................................................................... 62 Table 4.1: Original MCA Qualification Criteria ........................................................................ 110 Table 4.2: Central Asian Countries Disqualified from MCA Consideration Due to WGI Scores ................................................................................................................................. 125 Table 4.3: ADF Performance-Based Shares by Country Group, 2002–2008 ............................ 139 Table 5.1: Basic Profile of First Nineteen Compacts, 2005–2009 ............................................ 161 Table 5.2: Sector Distribution of First Nineteen Compacts ....................................................... 162 Table 5.3: Distribution of Analyses by Constraint in CA Final Reports ................................... 192 Table 5.4: Number of Times Constraint Identified in Final Report and Classified as Binding ............................................................................................................................... 193 Table 5.5: Distribution of Identified Constraints Matched to Final Compact Investments ....... 195 Table 5.6: Summary Statistics for Compacts Developed with and without Constraints Analyses ............................................................................................................................. 201 Table 5.7: Distribution of Sectors Among Compacts Developed with Constraints Analyses ............................................................................................................................. 202 Table 6.1: MCC's Evaluation Record as of 2015 ....................................................................... 236 Table 6.2: Distribution of MCC Development Funding and RCTs by Sector and Year ........... 238 Table 6.3: Sectoral Distribution of RCTs in 3ie Database of Impact Evaluations .................... 239 Table 6.4: RCTs Among Agriculture and Rural Development Projects in 3ie's Database ....... 244 Table 6.5: MCC's Completed FTT Projects with an RCT ......................................................... 249 ii Table 6.6: Eligibility Criteria for Participation in MCC FTT Projects ...................................... 255 Table 6.7: Key Characteristics Among Early and Late Treatment Groups: MCC-FTT Projects ............................................................................................................................... 262 Table 6.8: Differences-in-Differences Matrix ........................................................................... 263 Table 7.1: Sites of Conflicting Rationalities .............................................................................. 292 Table 7.2: Growth Diagnostics as Obligatory Passage Points ................................................... 305 Table 7.3: Governance Indicators as Obligatory Passage Points ............................................... 307 Table 7.4: Randomized Controlled Trials as Obligatory Passage Points .................................. 309 Table 7.5: Influential Decision-makers Before and After Stabilization of Methods ................. 316 Table B-1: Differences in Income Between Low-income Countries Based on MCA Qualification Criteria Performance, 2004–2012