Global Institutions and Development - Framing The World

Global Institutions and
Development
The dearth of attention to ideas in multilateral institutions has prompted

analysts to probe their role as intellectual actors. Global Institutions and
Development is an insightful and welcome collection of essays exploring the
nexus of ideas, institutions, and development policy.
Thomas G. Weiss, Presidential Professor and Director,
Ralph Bunche Institute for International Studies,
the CUNY Graduate Center
Global Institutions and Development’s impressive scope covers a wide range

of policy ideas and institutions, skilfully interweaving original case studies
with cutting edge conceptual insights
Jonathan Fox, University of California, Santa Cruz
The impact that multilateral institutions have on development is hotly debated,

but few doubt their power and influence. This book is about the role of ideas in
such institutions: why some particular ideas are taken up; how they travel within
the multilateral system; and how they are translated into policy, modified,
distorted or resisted.
Global Institutions and Development argues that ideas are sometimes used, know-
ingly or unknowingly, to promote interests or worldviews favoured by powerful
states or institutions. The book provides detailed case studies of selected ideas –
such as social capital, sustainable development, reproductive health and gover-
nance – and a range of organizations, including the World Bank, UNDP, IMF,
WTO, ADB, UNFPA, ILO and OECD.
It will be of interest to students and researchers in political science, develop-
ment studies, economics, sociology and anthropology.
Morten Bøås is a Researcher at Fafo – Institute for Applied International

Studies, Norway. Desmond McNeill is Research Professor, and former
Director, at the SUM (Centre for Development and the Environment),
University of Oslo, Norway.
RIPE series in global political economy
Series editors:
Louise Amoore University of Newcastle, UK
Randall Germain Carleton University, Canada
Rorden Wilkinson University of Manchester, UK
Formerly edited by Otto Holman, Marianne Marchand (Research Centre for
International Political Economy, University of Amsterdam), Henk Overbeek (Free
University, Amsterdam) and Marianne Franklin (University of Amsterdam).
This series, published in association with the Review of International Political
Economy, provides a forum for current debates in international political economy.
The series aims to cover all the central topics in IPE and to present innovative
analyses of emerging topics. The titles in the series seek to transcend a state-
centred discourse and focus on three broad themes:
¥ the nature of the forces driving globalization forward
¥ resistance to globalization
¥ the transformation of the world order
The series comprises two strands:
The RIPE series in global political economy aims to address the needs of students and
teachers, and the titles will be published in hardback and paperback. Titles include:
Transnational Classes and Political Economy of a Plural
International Relations World
Kees van der Pijl Critical reflections on power, morals and
civilizations
Gender and Global Restructuring
Robert Cox with Michael Schechter
Sightings, sites and resistances
Edited by Marianne H. Marchand and Anne A Critical Rewriting of Global
Sisson Runyan Political Economy
Integrating reproductive, productive and
Global Political Economy
virtual economies
Contemporary theories
V. Spike Peterson
Edited by Ronen Palan
Contesting Globalization
Ideologies of Globalization
Space and place in the world economy
Contending visions of a new world order
André C. Drainville
Mark Rupert
Global Institutions and
The Clash within Civilisations
Development
Coming to terms with cultural conflicts
Framing the world?
Dieter Senghaas
Edited by Morten Bøås and Desmond McNeill
Global Unions?
Theory and strategies of organized
labour in the global political economy
Edited by Jeffrey Harrod and Robert O’Brien
Routledge/RIPE studies in global political economy is a forum for innovative new
research intended for a high-level specialist readership, and the titles will be
available in hardback only. Titles include:
1 Globalization and 8 The Changing Politics of
Governance * Finance in Korea and Thailand
Edited by Aseem Prakash and Jeffrey A. From deregulation to debacle
Hart Xiaoke Zhang
2 Nation-States and Money 9 Anti-Immigrantism in
The Past, Present and Future of Western Democracies
National Currencies Statecraft, desire and the politics of
Edited by Emily Gilbert and Eric Helleiner exclusion
Roxanne Lynn Doty
3 The Global Political Economy
of Intellectual Property Rights 10 The Political Economy of
The new enclosures? European Employment
Christopher May European integration and the
transnationalization of the
4 Integrating Central Europe
(un)employment question
EU expansion and Poland, Hungary
Edited by Henk Overbeek
and the Czech Republic
Otto Holman 11 Rethinking Global Political
Economy
5 Capitalist Restructuring,
Emerging issues, unfolding odysseys
Globalisation and the Third
Edited by Mary Ann Tétreault, Robert A.
Way
Denemark, Kenneth P. Thomas and Kurt
Lessons from the Swedish model
Burch
J. Magnus Ryner
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Relations Theory
and the Struggle over European
Matthew Davies and Michael Niemann
Integration
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7 World Financial Orders
Bargaining coalitions in the GATT
An historical international political
and WTO
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Paul Langley
* also available in paperback

Global Institutions
and Development
Framing the world?
Edited by Morten Bøås and

Desmond McNeill
First published 2004
by Routledge
11 New Fetter Lane, London EC4P 4EE
Simultaneously published in the USA and Canada

by Routledge
29 West 35th Street, New York, NY 10001
Routledge is an imprint of the Taylor & Francis Group
This edition published in the Taylor & Francis e-Library, 2004.
© 2004 Morten Bøås and Desmond McNeill for selection and editorial
matter; individual contributors their contributions
All rights reserved. No part of this book may be reprinted or reproduced

or utilized in any form or by any electronic, mechanical, or other means,
now known or hereafter invented, including photocopying and recording,
or in any information storage or retrieval system, without permission in
writing from the publishers.
British Library Cataloguing in Publication Data

A catalogue record for this book is available from the British Library
Library of Congress Cataloging in Publication Data

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ISBN 0-203-49633-7 Master e-book ISBN
ISBN 0-203-34429-4 (Adobe eReader Format)

ISBN 0–415–31289–2 (hbk)
ISBN 0–415–31290–6 (pbk)
Contents
List of contributors ix
Foreword xi
Preface xv
Acknowledgements xvii
List of abbreviations xviii
1 Introduction: power and ideas in multilateral institutions:

towards an interpretative framework 1
M O RT E N B Ø Å S A N D D E S M O N D M C N E I L L
2 The development discourse in the multilateral system 13

K N U T G. N U S TA D
3 Contesting policy ideas from below 24

NORMAN LONG
4 The informal sector: biography of an idea 41

DESMOND MCNEILL
5 Policy stories and knowledge-based regimes: the case of

international population policy 56
O L E JAC O B S E N D I N G
6 The World Bank and the environment 72

RO B E RT WA D E
7 Sustainable development and the World Trade Organization 95

M O RT E N B Ø Å S A N D J O N A S V E VAT N E
8 Social capital and the World Bank 108

DESMOND MCNEILL
viii Contents
9 Hegemony, neoliberal ‘good governance’ and the International

Monetary Fund: a Gramscian perspective 124
I A N TAY L O R
10 Balancing between East and West: the Asian Development

Bank’s policy on good governance 137
JA N N E J O K I N E N
11 ‘Good governance’ and the Development Assistance Committee:

ideas and organizational constraints 151
KEN MASUJIMA
12 The evolution of the concept of poverty in multilateral financial

institutions: the case of the World Bank 164
ALICE SINDZINGRE
13 The role of ideas in the United Nations Development

Programme 178
ASUNCION LERA ST CLAIR
14 The power of ideas: across the constructivist/realist divide 193

J A M E S J. H E N T Z
15 Ideas and institutions: who is framing what? 206

M O RT E N B Ø Å S A N D D E S M O N D M C N E I L L
Bibliography 225
Index 251
Contributors
Morten Bøås is a Researcher at Fafo – Institute for Applied International

Studies. His publications include Multilateral Institutions: A Critical Introduction
(co-authored with Desmond McNeill) (2003), and Ethnicity Kills? (co-edited
with Einar Braathen and Gjermund Sæther) (2000).
James J. Hentz is Assistant Professor of International Studies and Political
Science at the Virginia Military Institute. His publications include New and
Critical Security and Regionalism: Beyond the Nation State (co-edited with Morten
Bøås) (2003).
Janne Jokinen was previously Research Fellow at the Department of Political
History, University of Turku. He is currently working for the Finnish Ministry
of Foreign Affairs.
Norman Long is Professor of Sociology of Development at Wageningen
University. His publications include Development Sociology: Actor Perspectives
(2001).
Ken Masujima is Associate Professor at the Faculty of Law, University of
Kobe, Japan. His professional career includes experience as Associate Expert
at OECD, Paris.
Desmond McNeill is Research Professor at the Centre for Development and
the Environment, University of Oslo. His publications include Global
Sustainable Development in the 21st Century (co-edited with Keekok Lee and Alan
Holland) (2000), and Multilateral Institutions: A Critical Introduction (co-authored
with Morten Bøås) (2003).
Knut G. Nustad is Associate Professor at the Department of Social
Anthropology, University of Oslo. His publications include ‘Development: the
devil we know?’, Third World Quarterly 22 (4): 479–89.
Ole Jacob Sending is Research Fellow at the Norwegian Institute of
International Affairs (NUPI). His publications include ‘The instrumentalisa-
tion of development knowledge’, in Diane Stone (ed.) Banking on Knowledge:
The Genesis of the Global Development Network (co-authored with Knut G. Nustad)
(2000).
x Contributors
Alice Sindzingre is Research Fellow at the Centre National de la Recherche

Scientifique (CNRS), Paris. Her publications include ‘Les bailleurs de fonds
en manqué de légitimité’, Esprit 264: 116–27 (2000).
Asuncion Lera St Clair is Research Fellow at the Centre for International
Poverty Research, University of Bergen.
Ian Taylor is a Lecturer at the Department of Political and Administrative
Studies, University of Botswana. His publications include South Africa’s
Multilateral Diplomacy and Global Change: The Limits of Reformism (co-edited with
Philip Nel and Janis van der Westhuisen) (2001).
Jonas Vevatne is a Researcher at the Centre for International Climate and
Environmental Research, Oslo (CICERO).
Robert Wade is Professor of Political Economy and Development at the
London School of Economics. His publications include ‘US Hegemony and
the World Bank: the Fight over People and Ideas’, Review of International
Political Economy 9 (2): 201–29 (2002), and Governing the Market (1990).
Foreword
At the Millennium Summit held at the United Nations in 2000, 147 heads of
state and government agreed on goals for halving world poverty by 2015.
Subsequently, almost all international agencies have declared active support for
these goals to be among their highest priorities. But when it comes to action by
the international agencies, in what sense can we assume that the goals have been
adopted? When it comes to implementation, in what ways will the goals be
modified, distorted or resisted? And what can be done to keep agencies more in
line with what has been agreed?
These are key questions – on which the agency-focused chapters of this wide-
ranging study present evidence, sometimes encouraging; often disturbing.
Modification, distortion and resistance to ideas are inherent in the structure,
personnel and professional approaches of all the international agencies, and this
can undermine the simple implementation of even clearly agreed goals. But all is
not lost. The studies also show some of the countervailing forces at work, espe-
cially well organized lobbying by the NGOs, which can help keep an
international agency on track.
Some of the studies may seem academic, and indeed, the ambition of this
book is to make a contribution to the literature of international relations. But I
hope that my fellow economists working in the World Bank and other interna-
tional agencies will read it, because they in particular have a lot to gain.
Ideas matter – but ideas are also interpreted differently in different institutions
and the ideas and interpretations change over time, again in different ways in the
different institutions. An example is how World Bank staff reacted to the new
notion of social capital; there are gaps in thinking and approach between
researchers and policy makers, between staff with different disciplinary back-
grounds and between those applying the ideas in different policy contexts.
Economists, in particular, regularly lead the way in adapting, modifying and
distorting ideas, often with the best of intentions. Trained to high standards of
precision in thought, and with methodologies purporting to be scientific and value-
free, economists find it difficult to take aboard the perspectives and approaches of
other disciplines. Yet as several of these studies show, concerns with environment,
poverty and participation have frequently been significantly modified and distorted
in the ways international agencies have adopted – and adapted – them.
xii Foreword
Closely related to these modifications and distortions, and often underlying

them, are the interests and dominating influence of the industrial countries,
especially the biggest and most powerful. The orthodoxy of structural adjust-
ment in the 1980s and of the Washington Consensus and the concept of good
governance in the 1990s are supreme examples of this tendency. When allowed
to have full rein, the dominating interests and influences can lead to the presen-
tation of key ideas as common-sense approaches to rational economic
management within countries, whereas they are in fact better explained as
attempts by the North to reconstruct the South in its own image ‘along decidedly
neoliberal lines’ and in ways which mostly match its own economic interests.
How does all this relate to the achievement of the goals for a major reduction
of world poverty over a fifteen year period? For all the international agencies
involved, supporting these goals involves a number of concrete steps: from
defining the issues to monitoring and assessing results. Each of these involves
ideas and concepts – and thus, as this study shows and warns, a process of adap-
tation and probably of modification and distortion of the ideas concerned. Even
when top management is fully committed to the achievement of the goals, there
is also likely to be resistance, especially when the very idea of supporting global
goals for poverty reduction differs from past practice or from the professional
training, paradigms and ideology of the main body of staff.
What can be done? Management consultants would no doubt say that this
was a typical problem for any institution, with top management trying to
ensure ‘buy-in’ among staff for new goals and new approaches. No doubt
some of this is involved. But this book suggests there are much broader and
more important and subtle problems behind the scenes, especially for interna-
tional agencies. There is much to be learned from the case studies in this
volume, for those ready to work through and ponder them with an open
mind. The problem is not only bureaucratic resistance among staff to new
ideas and goals, but how the very ideas and goals will be so adapted and
distorted as to frustrate the realization of their underlying objective – the
reduction of human poverty on a global scale, in ways which lead to the
empowerment of the poor and marginalized in all countries and regions of
the world. However, poverty reduction on a global scale is possible with
empowerment, providing there are moves to some more democratic sharing
of power, internationally and nationally.
The UN provides for this, far from perfectly but within a structure in which
the voices of all countries can be heard. The UN also provides for the recogni-
tion of a wide range of human rights: political and civil rights which open the
way to community empowerment as well as economic, social and cultural
rights which open the way to equality, and to measures like education for girls
which can open doors to strengthening personal capacities. Equally important,
these rights and the many inter-government resolutions underpinning them,
have served as focal points around which many NGOs, professional and
activist, have rallied to press for more serious implementation. How NGOs
mobilized action within the World Bank on environment shows their potential.
Foreword xiii
But for this to happen, there needs to be more recognition of the entire UN
in the pursuit of poverty reduction. If the task is mainly left to the Bretton
Woods institutions, with these being allocated the bulk of international resources
for poverty reduction, the modifications, distortions and resistance noted in
many of the case studies will undercut the effective achievement of the goals,
even with committed leadership and sincere efforts from Bretton Woods staff to
implement the goals as they perceive them. The rest of the UN needs to be fully
involved, with their different perspectives and approaches strongly and fully
represented. If this is done, the international effort will not only be stronger but
less biased and distorted.
Richard Jolly
Fellow and Former Director of the Institute of Development Studies
Preface
There has been an increasing interest in the role of ideas among students of
International Political Economy (IPE) over the last decade. This interest extends
beyond IPE into the field of international relations and, as such, reflects a change of
direction within the discipline. One can speculate as to why this sudden interest in
ideas has emerged, but it appears that profound transformations engendered by
globalization are an important contributing factor. Within this rapidly changing
environment, dominant ways of seeing and doing are no longer taken for granted.
As academics, we wish to understand why certain changes are occurring and what
ideas guide their direction.
Global Institutions and Development: Framing the World? provides an unique contri-
bution to the growing body of literature reflecting this cultural turn in IPE/IR.
It is unusual in that it makes a conceptual contribution to the study of ideas by
suggesting an eclectic approach informed by such diverse perspectives as realism,
constructivism and neogramscianism. In choosing such an approach, the editors
Morten Bøås and Desmond McNeill reject the institutional and expert-and-
activist approaches to the study of ideas and associate themselves with construc-
tivist and critical theoretical perspectives. Bøås and McNeill find that, within
mainstream constructivist approaches, too little attention is being spent on the
question of how the distribution of power influences the formulation and
primacy of certain ideas. In the editors’ view, neogramscianism, in contrast,
sometimes errs on the side of materialism. However, the consensual underpin-
nings of hegemony in combination with the notion of the social construction of
politics and while being attentive to the importance of power (distribution)
provides a framework for studying the role of ideas, their importance and how
they “travel” within multilateral institutions.
An additional reason for the importance of the present volume resides in the
fact that it forces IPE scholars to seriously consider development issues and the
field of development studies. As a topic, development has been rather marginal-
ized within the fields of IR and IPE. In focusing on multilateral institutions and
drawing on insights from IPE, development studies and other disciplines such as
anthropology and economics, the contributions provide a microcosm of issues and
concerns that resonate with the IPE community. Moreover, even within the field of
development studies, the role of ideas generated by the multilateral institutions has
Preface xv
received very little attention. The United Nations only recently started a project on
its intellectual history (see foreword by Sir Richard Jolly). This is a clear indication
that even within the multilateral institutions there now exists a need to reflect on
the role of ideas, or as the editors have titled their project, on the Creation,
Adoption, Negation, and Distortion of Ideas in Development Assistance (Candid).
Concepts central to the discourse surrounding multilateral institutions include
social capital, sustainable development, good governance and poverty. As
suggested, these ideas are not only important within the development commu-
nity but are also central concerns for IPE, especially when taking into account
the two underlying forces of neoliberal ideology and the economic–technocratic
nexus which informs much of the way in which ideas are traveling through the
institutions. Development and IPE scholars need to be aware of the power of
these forces and how they can shape the policies emanating from the multilateral
institutions.
The volume clearly shows that ideas are not coming from a single source such
as the US treasury. However, in order to be “heard” and accepted, ideas need to
comply with certain pre-requisites; in particular, they need to have a good fit
with the two forces mentioned. If this is not the case, resistance against a partic-
ular idea will be developed and it will be transformed so as to provide a fit. This
has happened, for instance, with the concept of sustainable development.
In short, Global Institutions and Development: Framing the World? by Bøås and
McNeill is a must–read, not only for academics from the fields of IR,IPE and
development studies but also by representatives of non-governmental organiza-
tions who are wondering why certain initiatives find such dogged resistance and
others not. Moreover, those policy–makers and researchers working in the
“world” of multilateral institutions will also find much useful information about
how their own organizations work and why certain policy initiatives may not work
as their underlying concepts have been distorted in the process of taking them on
board. In sum, it is not only an excellent contribution to the RIPE Series in
Global Political Economy but most importantly it is an unique and much needed
contribution to the field of development studies and policy-making.
Otto Holman
Marianne Marchand
Henk Overbeek
Marianne Franklin
July 2003
Acknowledgements
This book is one output from the project on Creation, Adoption, Negation, and
Distortion of Ideas in Development Assistance (CANDID). This project was
financed by the Norwegian Research Council’s programme on the multilateral
system, and hosted by the Centre for Development and the Environment (SUM),
University of Oslo. We would like to thank our colleagues at SUM for support,
comments and criticism. So many people have contributed to this volume that it
is simply impossible to list them all. We are very grateful to those of you who
read some of our many drafts and took the time to share your insights with us.
There are also some persons we cannot avoid mentioning. Thomas Weiss,
Richard Jolly, Louis Emmerij, Tatiana Carayannis, Jan Aart Scholte, Carlos
Santiso, Richard Higgott and Robert Wade have in various ways made impor-
tant impacts on the way in which we think about the relationship between ideas
and international institutions.
As we started to develop this volume we have benefited immensely from
Marianne H. Marchand’s advice, comments and criticism. We would also like to
thank the four anonymous reviewers. We still disagree with some of the comments
they made, but they certainly also improved this volume. Finally we would like to
thank Heidi Bagtazo at Routledge for her patience and professionalism.
Morten Bøås
Desmond McNeill
Abbreviations
ADB Asian Development Bank

ADF Asian Development Fund
AfDB African Development Bank
CTE Committee on Trade and Environment
DAC Development Assistance Committee
DMCs Developing Member Countries
EA Environmental Assessment
ECOSOC United Nations Economic and Social Council
EDF Environmental Defence Fund
EMIT Working Group on Environmental Measures and International
Trade
ESAF Enhanced Structural Adjustment Facility
FAO Food and Agricultural Organization
GATT General Agreement on Tariffs and Trade
GCI General Capital Increase
GEF Global Environmental Facility
HDI Human Development Index
HDR Human Development Report Office
HUDCO Housing and Urban Development Corporation
IBRD International Bank for Reconstruction and Development
ICPD International Conference on Population and Development
IDA International Development Association
IDS Institute of Development Studies
IFIs International Financial Institutions
ILO International Labour Organization
IMF International Monetary Fund
IPPF International Planned Parenthood Federation
IWHC International Women’s Health Coalition
LDCs Less Developed Countries
MDBs Multilateral Development Banks
MOF Ministry of Finance (Japan)
NAFTA North American Free Trade Area
NBA Narmada Bachao Andolan
xviii Abbreviations
NGOs Non-Governmental Organizations

NIEO New International Economic Order
NRDC National Resources Defence Council
NWF National Wildlife Federation
OCR Ordinary Capital Resources
ODA Official Development Assistance
OECD Organization for Economic Cooperation and Development
PRC People’s Republic of China
SAF Structural Adjustment Facility
SAPs Structural Adjustment Programmes
UN United Nations
UNCED United Nations Conference on Environment and Development
UNCHE United Nations Conference on the Human Environment
UNHCR United Nations High Commission for Refugees
UNCTAD United Nations Conference on Trade and Development
UNDP United Nations Development Programme
UNEP United Nations Environmental Programme
UNESCO United Nations Educational, Scientific and Cultural
Organization
UNFPA United Nations Fund for Population Activity
UNHCR United Nations High Commission for Refugees
UNICEF United Nations Children’s Fund
UNRISD United Nations Research Institute for Social Development
USAID United States Agency for International Development
WCED World Commission on Environment and Development
WDR World Development Report
WHO World Health Organization
WTO World Trade Organization
1 Introduction
Power and ideas in multilateral
institutions: towards an interpretative
framework
Morten Bøås and Desmond McNeill
Introduction
The impact that multilateral institutions have on development is hotly debated,
but few doubt their power and influence. This book is about the role of ideas in
such institutions. It is remarkable how little is known about this subject: why
some particular ideas are taken up by the multilateral institutions; how they
travel within the multilateral system; and how they are translated into policy,
modified, distorted or resisted. This book seeks to redress this situation by
offering perspectives that can be used to critically assess the political processes
around some of the ideas that have informed the current development discourse,
as evident in the policy prescriptions of the major multilateral institutions.
An ‘idea’ in this context is a concept which powerfully influences develop-
ment policy. It is more than simply a slogan or ‘buzzword’ because it has some
reputable intellectual basis, but it may nevertheless be found vulnerable on
analytical and empirical grounds. What is special about such an idea is that it is
able to operate in both academia and policy domains.1
The relationship between power and ideas is challenging. Do ideas have
power in themselves? Or only to the extent that they are actively taken up by
powerful individuals or groups? And what sort of power do ideas have: to moti-
vate, or to alter the actions of individuals or groups? Clearly, their power must be
tied up with the institutionalization of social action and the material capabilities
that such kind of institutionalization is built upon. What then is the nature of the
relationship; to what extent do ideas change institutions; or do institutions
change ideas?
In this study we are concerned with multilateral institutions, and the exercise
of what Gramsci calls hegemonic power. We suggest that powerful states (notably
the USA), powerful organizations (such as the IMF ) and even, perhaps, powerful
disciplines (economics) exercise their power largely by ‘framing’: which serves to
limit the power of potentially radical ideas to achieve change. The exercise of
framing is composed of two parts: one, drawing attention to a specific issue (such
as the environment or urban unemployment); two, determining how such an
issue is viewed. A successful framing exercise will both cause an issue to be seen
by those that matter, and ensure that they see it in a specific way. And this is
2 Morten Bøås and Desmond McNeill
achieved with the minimum of conflict or pressure. A good example, analysed at

some length in this book, is the idea of governance. As George and Sabelli
(1994: 150) put it: ‘Being against good governance is rather like being against
motherhood and apple-pie.’ An effective ‘frame’ is one which makes favoured
ideas seems like common sense, and unfavoured ideas as unthinkable. We suggest
that a similar argument can be applied also to the other ideas because as Cox
(1992a: 179) argues, ‘hegemony frames thought and thereby circumscribes
action’.
How and why does such ‘framing’ occur? A strong claim is that the most
powerful multilateral institutions, in terms of the resources at their command,
are controlled by the donor countries (and most particularly the USA), promote
neoliberal ideas, and are dominated by an economic perspective; any challenging
new ideas that arise, if not directly refuted, are distorted, in keeping with this
worldview (and world interest). A weak claim is that multilateral institutions are
necessarily consensual and technocratic; and that new ideas are diluted and
distorted in the process of gaining broad acceptance for them, and putting them
into operation. In this book we analyse a number of such framing exercises. But
although the ideas concerned have been diluted and distorted in various ways, it
is evidence of their potency that they have seldom been rejected outright. What
emerges from the case studies is that the distortions that have occurred have
been predominantly technocratic. There are, we suggest, two distinct, but partly
related, forces at work: one is neoliberal ideology, the other what we call the
economic–technocratic nexus. Whether and to what extent a specific idea is
distorted as a result of the former depends on the type of idea; but all, we
suggest, are subject to the latter. What is common to both is ‘depoliticization’:
ideas are drained of any overt political content, even if they are not wholly
drained of their power. This perhaps helps to explain the frustration of those
who seek to oppose multilateral institutions and the policies they explicitly stand
for; and why opposition to these institutions is increasingly taking an anarchistic
form. All multilateral institutions are, of necessity, technocratic. In order for
ideas to be used in such organizations they must be translated into terms which
can be operationalized. This, we suggest, (together with the importance of
achieving consensus), tends to involve a process of ‘depoliticization’, and a
tendency for economics to become the dominant discipline. In short, we suggest
that ideas that challenge the conventional wisdom become distorted as a result of
a series of related pressures: depoliticization and ‘economization’ which may be
– but are not necessarily – linked to neoliberal ideology and the material inter-
ests of those countries with most power in the system.
Institutions, ideas and approaches

Multilateral institutions, often in association with academia, seek to establish
global consensus around certain ideas that they see as important for their policy
purposes and international image. Indeed, in the introduction to Ahead of the
Curve (the first major publication from the UN Intellectual History Project),
Power and ideas in multilateral institutions 3
Emmerij et al. (2001) argue that ideas and concepts are the most important
legacy of the UN.2 Such ideas arise and are developed in the interplay between
the two domains of academia and policy making, but they derive their credibility
from their basis in the former. Examples include the informal sector, sustainable
development, governance and social capital – which have contributed both to
the development of new policy approaches and to institutional change. It is ideas
such as these that are the focus of our interest here, ideas that are widely used by
policy makers and have significant influence on them. Legitimacy in the making
of development policy is often sought from grounding the proposals in a theoret-
ical base and in supporting empirical analysis. In multilateral institutions, whose
constituency is relatively ill defined, this is especially important. Moreover, origi-
nality in ideas seems to be highly valued – whether because of the beauty of new
ideas or the hope that new policies will be more successful than old ones; hence
the often heard critical comment on ‘fashions’ in development assistance policy.
This volume makes reference to all major multilateral development institu-
tions: the World Bank and the United Nations Development Programme
(UNDP); the regional development banks: the Asian Development Bank (ADB),
the Inter-American Development Bank, and the African Development Bank.
Also included are the International Monetary Fund (IMF ), the World Trade
Organization (WTO) and the Organization for Economic Cooperation and
Development’s Development Assistance Committee (OECD-DAC); because
although not strictly development institutions, they have, to varying extents,
played an important role in the multilateral system, and because they too are
actively participating in the arena of ideas – at least with regard to some issues
(e.g. governance in the IMF/OECD-DAC and sustainable development in
WTO). To what extent do these institutions constitute a coherent group?
The term ‘multilateral’ suggests many member countries, but it is unspecific
as to what number constitutes many. It can refer to anything from a minimum of
three countries to an institution that encompasses all sovereign countries in the
world (Caporaso 1993). Some of the institutions we are concerned with here
have almost universal membership (for instance the World Bank and the IMF),
whereas others have clear limitations to membership (e.g. the regional develop-
ment banks and OECD-DAC).
When we talk about multilateral institutions we are also talking about social
institutions. Institutions have been defined as ‘recognised practices constituting
of easily identifiable roles, coupled with collections of rules or conventions
governing relations among the occupants of these roles’ (Young 1986: 107). Or,
to quote another definition, institutions are ‘persistent and connected sets of
rules (formal and informal) that prescribe behavioural rules, constrain activity
and shape expectations’ (Keohane 1989: 3). As social institutions, the multilat-
eral institutions possess a clear coercive quality. The member states and the
other actors in the institutions are expected to perform certain roles, and the
costs to actors who opt out of participation are both uncertain and possibly very
high. This is, as some of the case studies will reveal, one reason why some states
have maintained their membership in particular multilateral institutions, even if
highly disturbed by what was going on there. Multilateral institutions can thus
be understood not only as socially constructed arenas for the facilitation of
international order and cooperation, but also as battlefields between different
actors (both state and non-state). This conflict aspect of multilateral institutions
is, however, often hidden, largely because they have – ever since their establish-
ment – adopted the doctrine of political neutrality. Most of the policies and
statements from these institutions are (at least in rhetorical terms) founded on
the functionalist logic that technical economic questions can be separated from
politics. In the Agreement Establishing the African Development Bank and the Agreement
Establishing the Asian Development Bank the principle of political neutrality is clearly
present.
The Bank, its President, Vice presidents, officers and staff shall not interfere
in the political affairs of any members; nor shall they be influenced in their
decisions by the political character of the member concerned. Only
economic considerations shall be relevant to their decisions. Such considera-
tions shall be weighed impartially in order to achieve and carry out the
functions of the Bank.
(AfDB [African Development Bank] 1964: Art. 38; ADB 1966: Art. 36)
Almost precisely the same text – word for word – is to be found in the World
Bank’s (1989a) Articles of Agreement, Article IV, Section 10. These statements
of functionality and a technical, non-political approach to development are of
course a facade. Every question concerned with development is a question
concerned with planned social change and thereby also necessarily a political
question. But multilateral institutions strive to avoid or minimize overtly political
action. Important for our understanding of the role of ideas in the multilateral
system is therefore the extent to which a technical, depoliticized approach to devel-
opment has influenced the relationship between power and ideas; to what degree
the technical discourse in the multilateral institutions has influenced the use of
ideas taken up by the multilateral institutions.
Given that the focus of this book is on institutions, and the relationship
between power and ideas, it is not surprising that the disciplinary focus of five of
the contributors is that of political science; but the backgrounds of the others are
quite varied. It is our view that important contributions to the study of institu-
tions can be gained by incorporating insights from, for instance, economic
sociology (the new institutionalism and the old institutional economics), anthro-
pology (not only in relation to small and informal social groups, but also formal
institutions such as development agencies), and from philosophy (certainly to the
extent that the power of ideas derives from their moral content). In studying
similar topics, these different disciplines also find themselves confronting similar
theoretical issues, such as embeddedness and autonomy; the agency–structure
question; and the issue of mutually constitutive phenomena. However, although
this volume has benefited from insights from many disciplines, our work is
located primarily in political science. More specifically, in terms of our theoret-
ical approach, we locate ourselves within the nexus of realism, constructivism

and neogramscianism. This implies that, in contrast to most of the literature on
the role of ideas, we both seek to build a broader approach and place more
emphasis on power and power relationships. To briefly illustrate our position, it
is useful to refer to Weiss and Carayannis’ (2001: 28–32) review of the ideational
literature. They argue that the literature on the role of ideas can be grouped into
three categories:
1 institutional approaches (e.g. Sikkink 1991; Goldstein and Keohane 1993)

2 expert- and activist-group approaches (e.g. Hall 1989a; Haas 1992; Risse
and Sikkink 1999)
3 constructivist approaches and critical theory (e.g. Cox 1997, Ruggie 1998;
Wendt 1999)
Our own approach falls mainly into the third of these categories. Within this,
Weiss and Carayannis distinguish two rather different bodies of literature: that of
Cox and others (the critical approach) and of Wendt, Ruggie and others
(constructivism). We have much in common with Cox, although not all in this
volume share his normative agenda. With regard to constructivists, we fully
agree with their claim about the social construction of politics. However, we are
also concerned that mainstream constructivist approaches (e.g. Ruggie 1998;
Wendt 1999) put too much emphasis on shared ideas and the role of norms and
legal institutions, and thereby neglect the real relationship between power and
ideas. This is the main reason why we prefer to continue to flag the realist
assumption that outcomes cannot be properly analysed in disregard of the distri-
bution of power. And this is also our bridge to neogramscian critical theory. In
particular, we find the neogramscian understanding of the consensual aspect of
hegemony to be of value in our investigations. However, we also find clear limi-
tations in neogramscianism. If we accept the central premise that both ideas
(shared and contested) and the distribution of power (ideational and material)
matter, then we need to study the interplay between actors and structures in the
various power games that take place in relation to these material and ideational
struggles in multilateral institutions.
Thus we believe that there is much to be learned from the work of Gramsci
and Cox; the former for his theories of hegemony, and the latter for the applica-
tion of such theory specifically to the field of international political economy.
More generally, several of the chapters in this book relate to the so-called
realist–constructivist debate within international relations theory, which is
concerned with issues and questions that have implications far beyond the disci-
plinary borders of political science. In fact, we will argue that most of the
authors in this book (political scientists or not) explicitly or implicitly seek to
establish a middle ground in the realist–constructivist debate; not merely because
the extreme positions in this debate are not sufficiently nuanced, but more specif-
ically because neither perspective is well equipped to cope with the central issue:
the relationship between power and ideas in multilateral institutions.
We claim that ideas have real power in the political world, but they do not
acquire political force independently of the constellation of institutions and
interests already present (Hall 1989b). Rather, ‘the structure of any social system
will contain three elements: material conditions, interests and ideas’ (Wendt
1999: 139). Interest formation ultimately has both a material and a social basis.
Materialist interpretations will give privilege to material conditions, under the
assumption that they generally determine interests. By contrast, ideational inter-
pretations will give privilege to ideas (Wendt 1999). These two contrasting
approaches may be applied also at a deeper level. In other words, it may be
claimed that material conditions directly influence ideas; or, alternatively, that
ideas directly influence material conditions.
In discussing ideas, in this broader sense, Cox (1986) makes a useful distinc-
tion between ideas as inter-subjective meaning (i.e. shared notions of social
relations which shape habits and expectations of behaviour),3 and as collective
images of social order (held by different groups of people). Collective images
differ both according to the nature and legitimacy of prevailing power relations
and structures, and with respect to the meanings attached to issues such as justice
or the distribution of and access to collective public goods. The difference
between ideas as inter-subjective meanings and as collective images is thus that
whereas the former are generally agreed/shared throughout a particular histor-
ical period and constitute the common framework for social discourse (conflict
included), the latter may be several and opposed (Cox 1986).4 One may thus,
drawing on both Wendt and Cox, suggest that interests are formed in part by
ideas as inter-subjective meaning (independent of material conditions) and in
part by ideas as collective images (influenced by material conditions). Ideas can
be used, knowingly or unknowingly, to promote interests or even more deep-
seated worldviews. Where these run counter to the interests or worldviews of
others, they may be imposed not through the direct use of power, but through
the exercise of what Gramsci calls ‘hegemony’; through the adoption of shared
ideas, and agreement concerning collective images.
Such a process depends crucially, we suggest, on institutionalization. From
both a material and an ideational interpretation, this is a way of stabilizing and
perpetuating one particular social order in the nexus between material condi-
tions, interests and ideas. The current multilateral system can thus be seen as the
institutionalization of the ‘order of things’. The institutions within this specific
system are particular amalgams of ideas, interests and material power which in
turn influence the development of ideas, interests and material conditions. The
approach in this volume is to see the multilateral system as a social construction,
and not as a pre-existing entity. Thus, we interpret institutions within this system
as institutions that take on a life of their own. They may become battlefields for
opposed ideas, and rival institutions may reflect different ideas. The tensions
between different interests cannot be wholly resolved, or even masked; and the
distortion of ideas, with which this research is largely concerned, arises precisely
from this.
Ideas and multilateral institutions: from informal

sector to social capital
In this book our aim is that each case study will make some contribution not only
to our knowledge of the idea and the institution concerned, but also to the
overall theoretical approach; and take up issues that arise also in other cases. For
example, the study of social capital and the World Bank raises the issue of the
power – or hegemony – of economics. And in seeking to understand the institu-
tional context of the World Bank, it examines the interplay between different
groups, with differing identities and differing norms: the researcher, the policy
maker, the operations staff; and how individuals face incompatible norms in
seeking to refer to more than one peer group.
In Chapter 2, Knut G. Nustad analyses the idea of development itself. His
starting point is the observation that this idea, as it has been expressed in the
multilateral system, has striking similarities with earlier conceptions of develop-
ment: the concern with imposing order and preventing social unrest, and
development as a process of social change emanating from the agency of elites.
The form that development has taken in the multilateral system, he argues,
implies an idea of trusteeship: that someone (multilateral institutions), who has
the necessary overview, guides the process of development. From this perspec-
tive, popular proposals for reform, such as participatory approaches, look more
like repeats of earlier efforts than true attempts to change the dominant develop-
ment thinking among multilateral institutions.
In Chapter 3, Norman Long provides an anthropological perspective on the
relationship between ideas, discourse and power – both in multilateral institu-
tions and ‘on the ground’. He emphasizes overlapping and multiplicity within
the development discourse, and in particular he is concerned with the relation-
ship between ‘expert’ and ‘lay’ knowledge. This relationship is related to the
debate between the multilateral institutions and their opponents. Long argues
the case for seeing this relationship as situated social practice. His point is that
multilateral institutions are found in several arenas of social struggle on many
levels of world politics, but they must be seen not in isolation but in relation to
each other.
There follow a number of case studies, of specific ideas and institutions,
beginning with the ‘informal sector’ which serves to introduce the dramatis
personae: the multilateral institutions (such as the the World Bank and the ILO),
the researchers and policy makers in North and South, etc. It introduces also
some of the phenomena – such as international conferences, and visiting
‘missions’ – for those who are not already well acquainted with them. And it
makes reference to the sorts of written materials which the different authors
draw on: not only academic books and articles, but also consultants’ reports,
policy documents, annual reports, commissioned studies, etc. The story it tells is
of an ‘idea’ which certainly became well established in both academic and policy
arenas, though also disputed and distorted.
Following some of the same steps as Desmond McNeill in Chapter 4, Ole
Jacob Sending’s contribution (Chapter 5) is concerned with the relationship
between knowledge and policy in the case of international population policy,

where a major shift in approach – associated with a new ‘idea’ – was carefully
orchestrated. His starting point is the observation that the International
Conference on Population and Development (ICPD) held in Cairo in 1994
produced a new ‘consensus’ on international population policy; whereas the
traditional policy approach of ‘family planning’ had defined population policy
from its very beginning in the 1950s, the ICDP placed a ‘reproductive health
approach’ to population policy at the core of its Programme of Action. This
observation causes Sending to ask two important questions: (1) why did family
planning remain the core term for population policy for over thirty years even
though there were constant controversies within the field about whether and how
to organize population policy; and (2) why did the change in population policy
from family planning to reproductive health take place during the ICPD process.
Sending’s argument is that in order to understand processes such as this one, we
must come to terms with the way in which the institution of science stabilizes
international policy by legitimizing and validating certain facts, theories and
concepts that form the foundation for certain specific policy approaches. In light
of this understanding, policy change is interpreted as the production and usage
of knowledge that creates space for the formulation of an alternative policy
approach (in this case reproductive health).
The next three chapters (6, 7 and 8) deal with the environment in the World
Bank (Robert Wade), the concept of sustainable development in the WTO
(Morten Bøås and Jonas Vevatne) and the role of social capital in the World
Bank (Desmond McNeill). These are quite closely related, although they also
illustrate the differences between the institutions, and issues, concerned. A
comparison of Robert Wade’s discussion on the environment in the World Bank
with Desmond McNeill’s analysis of the discussion on social capital in the same
institution shows us how the World Bank has in the former case been more reac-
tive, in the latter more proactive, in dealing with ideas that do not immediately
fit the traditional World Bank problem definition of development. Although the
work of the World Bank on social capital might be interpreted as an attempt to
move away from its previous technocratic approach to development, the case of
sustainable development in the WTO reveals a clearly technocratic response.
One reason might be that the WTO Secretariat’s neoliberal approach to interna-
tional trade also has defined the organization’s approach to sustainable
development.
The three following chapters (9, 10 and 11) represent not only three different
institutions’ approach to governance, but also different analytical approaches to
the study of ideas in multilateral institutions. Ian Taylor’s claim (Chapter 9) is
that the promotion of good governance by the IMF is a powerful example of how
certain ideas are constructed as common sense. In his analysis, good governance
is seen as a hegemonic discourse pursued by the North to define the South in its
own image, along neoliberal lines. Taylor’s contribution clearly falls within the
parameters of what is commonly referred to today as critical theory (akin to
writers like Cox and Gill). The approach of Janne Jokinen (Chapter 10) and Ken
Masujima (Chapter 11) is different, and falls within the institutional literature
(broadly defined). Nonetheless, seen together these three chapters cast an illumi-
nating light on the role of an idea such as governance. The point of departure
for Jokinen is the fact that the ADB was the first multilateral development bank
(MDB) with a board-approved policy on governance (3 October 1995). The
purpose of his chapter is therefore to look at the political and institutional envi-
ronments in which the ADB’s governance policy was created, and analyse how
these environments influenced the content of the policy. One of the main argu-
ments in this chapter is that the ADB’s governance policy was in many ways a
balancing act, in which it was necessary to find a way of defining the term so
that the interests of Western donors, Japan, the regional borrowing countries
and the Bank itself, at least temporarily, could be reconciled. Ken Masujima’s
chapter is concerned with the approach taken to the governance debate by the
OECD-DAC. At first sight, it may look as if the DAC has a comparative advan-
tage over other multilateral institutions concerning matters pertaining to
governance, since DAC (unlike most other multilateral institutions) is not
formally prohibited from interfering in the domestic affairs of non-member
countries. However, as the discussion on governance became more sophisticated,
the debate in the DAC was taken over by the World Bank. The OECD member
countries preferred to continue this debate in what they perceived as the domi-
nant (hegemonic?) multilateral institution. Thus, seen as a whole, these three
chapters illustrate how issues concerning ownership structure (the ADB vis-à-vis
the IMF) and perceptions about an institution’s importance for policy debates,
lead to differences in approaches, and also why some multilateral institutions (e.g.
the World Bank) become the chosen arena for debate rather than others (e.g.
OECD-DAC).
Chapter 12 (Alice Sindzingre) and Chapter 13 (Asuncion Lera St Clair)
analyse the idea of poverty in the World Bank and the UNDP respectively.
The idea of poverty has become one of the most recurrent concepts in the
development discourse, and the World Bank and the UNDP have both made
world poverty alleviation their main mission and reason for existence (i.e.
legitimization). In Sindzingre’s contribution she examines the different dimen-
sions of the trajectory of the idea of poverty in the World Bank, and links it
with the changes introduced to the concept by other institutions involved in
development, where a ‘consensus’ also has emerged on the priority of poverty.
This enables her to analyse the evolving meanings of the concept of poverty,
and in particular the nascent shift in the World Bank from income poverty to
inequality and multidimensionality. The World Bank has become more open
to other voices under Wolfensohn’s leadership, but a shift towards fuller
participation of poor countries continues to be hindered by many cognitive
and institutional constraints. Thus, as a broad concept allowing for multiple
meanings and policies, ‘consensus’ around poverty reflects the tensions of the
multilateralism-cum-hegemony characterizing the World Bank. The UNDP is
clearly a very different institution from the World Bank. It was created in
1965 in order to function as the specialized agency for the coordination of all
development assistance and technical cooperation programmes of the United

Nations. St Clair’s main claim is that the UNDP’s conceptualizations of
poverty are tied up not only with development theories, but also with the
central values and principles of the UN and specific organizational changes
that have taken place within the UNDP. The UNDP has evolved from an
agency giving technical and scientific assistance to less developed countries to
become a post-project agency, a policy agency with a significant concentration
on governance issues (Brown 1999). Changes at the organizational level are
parallel to changes in the UNDP’s conceptual framework; in the ideas,
concepts and theories that constitute the core of the institution’s policies. The
UNDP has seen itself as an important think-tank in the fields of development
and poverty reduction, although this ambition of intellectual leadership has
not been matched at the operational level, partly due to the discrepancies
between the tasks given to the UNDP and the limited resources of the institu-
tion. If we compare St Clair’s analysis of the UNDP with Sindzingre’s
chapter about poverty and the World Bank, it is interesting to hypothesize
that the UNDP has become more political by default; given its lack of
resources, the only viable alternative for the UNDP was precisely to become a
post-project agency.
In Chapter 14, James J. Hentz takes up some of the issues which Long
addressed in Chapter 3: the social construction of knowledge and patterns of
dominance and subordination, but from a somewhat different perspective. His
starting point is the observation that the West, and in particular the United States,
controls the key multilateral institutions. However, he also acknowledges that
multilateral institutions also play an autonomous role. In multilateral institutions,
ideas do shape interests and thereby also policy, but the power of the policies of
multilateral institutions can only effectively influence national policies if configu-
rations of power at the domestic level can sustain such policies. Accordingly,
Hentz’s argument is that this demands bringing the state back in, not necessarily
as an actor, but as an arena in the production and reproduction of a structure of
dominant knowledge. In order for international relations theory to be able to deal
with situations such as these, Hentz argues strongly for an understanding of the
power of ideas that goes well beyond the constructivist–realist divide.
In the final chapter of this book (Chapter 15) the two editors return to the
theoretical propositions of this chapter and seek both to evaluate them in the
light of the various case studies and contributions, and to offer some concluding
comments on the broader insights that can be extracted from this volume as a
whole concerning the nexus between power and ideas in multilateral institutions.
Concluding remarks
All multilateral institutions were established in order to solve problems. Apart
from the IMF and the WTO, the multilateral institutions we are concerned
with in this book were established in order to promote development and recon-
struction; first mainly in Europe after the Second World War (the World Bank)
and then later, as the processes of decolonialization accelerated, in so-called

Third World countries in Africa, Asia and Latin America.5 Development was
seen as a linear process towards increased prosperity and closer resemblance to
Western societies, facilitated through improvements in the fields of communi-
cation and infrastructure, agriculture and industrialization. Originally, many of
the issues discussed in this book fell outside their scope. But it is clear that the
problem definition of development within and among multilateral institutions
has changed considerably, as evidenced by the set of ideas referred to here:
unemployment/unregulated economic activity (the informal sector), the envi-
ronment, governance and the social fabric of society (social capital) and many
others. But the question remains: how do ideas trigger new policies and trans-
form institutional arrangements? What makes an idea attractive for
multilateral institutions?
In addressing these two questions it must be recognized that multilateral insti-
tutions are intergovernmental organizations, and therefore dominated by
political groups whose behaviour is subject to bounded rationality. And their
survival as multilateral institutions has more to do with keeping their member
governments happy than with their efficiency in a narrow sense.
Because the states that are the masters and clients of international organiza-
tions are a heterogeneous lot, they present a similar heterogeneous task
environment for organizational action. The task they jointly wish on the organi-
zations represents the sum of possibly very different tasks each government
faces at home.
(Haas 1990: 55)
This means that in comparison to other social units, multilateral institutions

confront certain specific challenges when faced with the demand for new ideas.
Their mission is never simple and straightforward, because both their member
states and other actors in their external environment disagree on the interpre-
tation of their mission as well as on how the tasks of the mission are to be
accomplished. As a result, conflict is an integral part of multilateral institu-
tions. In social units that function under such circumstances, organizational
routines and standard operating principles will be preferred to demands for
change. For an idea to be attractive to multilateral institutions it must therefore
be possible to adapt or distort it in accordance with already existing problem
definitions of development. Moreover, according to the charters of most multi-
lateral institutions, they were established in order to solve technical questions
in a functional manner. Their programmes, projects and policies are therefore
supposedly politically neutral. By defining various issue-areas and the
approach to them in a technical manner, multilateral institutions seek to keep
politics at bay. But these are, we assert, political institutions; and the twists and
turns in the different case studies that follow can be understood only when this
is recognized.
Notes
1 An ‘idea’ in this sense is thus distinct from a policy or programme such as import
substitution, or the New International Economic Order (though it may be closely
associated with one), and it is more specific than a paradigm such as Keynesianism or
neoliberalism.
2 The UN Intellectual History Project is directed by Louis Emmerij, Richard Jolly and
Thomas G. Weiss at the CUNY Graduate Center, and it is analysing the role of the
UN in the evolution of key ideas and concepts about international economic and
social development.
3 Such notions, although durable over longer periods of time, are historically deter-
mined. The order of the multilateral system has not always been represented in the
same way as today, and may not be so represented in the future. It is possible in hind-
sight to trace the origin of such ideas, and also to identify the turning points of
weakening or strengthening of them.
4 Thus collective images are not aggregations of fragmented opinions of individuals
such as those compiled through surveys, but coherent mental types shaped by the
longue durée (see Braudel 1969) and expressive of the worldviews of specific groups.
5 After the end of the cold war an additional field was opened up for the multilateral
institutions when former communist countries were defined as countries in transition
(i.e. from a socialist political economy to a market political economy). In this process it
was widely assumed that they were in need of the guidance of the expert knowledge
of multilateral institutions.
2 The development discourse
in the multilateral system
Knut G. Nustad
Introduction
Development has been one of the most influential ideas of the last century, espe-
cially since the end of the Second World War. The idea is, however, beginning to
lose its hegemonic position. Since the oil crisis in the 1970s, the agents in the
multilateral system appear to have been more concerned with stabilizing the
world market (as exemplified through the structural adjustment programmes)
than actually attempting to alleviate poverty. This abandoning of faith in devel-
opment has been reflected in academic writings in the field. Since the late 1980s,
a group of authors writing from a poststructuralist perspective have begun to
analyse development as a powerful discourse. Focus has been shifted to the way
in which discourses of development help shape the reality they pertain to
address, and how alternative conceptions of the problem have been marked off
as irrelevant (see for example Cowen and Shenton 1995; Crush 1995; Escobar
1984; 1995a; Ferguson 1990; Sachs 1995).
This chapter has two aims: first, it is argued that the idea of development, as
it has been expressed in the multilateral system, has important similarities with
earlier conceptions of development. Although nineteenth-century ideas about
development as formulated by the Saint-Simonians were different from the
version adopted by the World Bank, there were also striking similarities: both
were concerned with imposing order and forestalling social unrest, and both saw
development as emanating from the agency of elites. After pointing out these
constants in the idea of development, the second part of the chapter addresses
the question of whether it is possible to reform the idea of development, by
rethinking it as a people-driven process. This second part, then, explicitly
addresses the question of the role of ideas in the multilateral system, and the
relationship between the institutional framework within which the ideas are
produced and the ideas themselves. The conclusion is somewhat pessimistic, and
it will be argued that the structure of the multilateral system makes it unlikely
that a radical new conception of development will emerge within its boundaries.
Alternatives to development will have to be sought elsewhere.
Before turning to that argument, I want to introduce a dichotomy that I find
a useful analytical tool. That is the distinction between the immanent and the
14 Knut G. Nustad
intentional meanings of the word ‘development’. This conceptual pair, intro-

duced by Cowen and Shenton (1995), seeks to distinguish between two usages of
the word development: as active intervention, as in a development project (inten-
tional), and as a process that unfolds over time, as in ‘the development of
capitalism’ (immanent). It was when development in the immanent sense was
seen as creating problems that could be solved by active intervention, that inten-
tional development was created. This historical transformation is discussed in the
next section.
Proposal for a Bank

The idea of development has a history that stretches back at least a century
before the emergence of a multilateral development system. Cowen and
Shenton’s Doctrines of Development (1996) represents the first major attempt to
write a history of development discourse. According to them, intentional devel-
opment emerged as a solution to the problems created by the immanent
development of capitalism in the first half of the nineteenth century. Capitalism
had alienated producers from the means of production, but not everybody was
reintegrated in the production process as wage-labourers. A surplus population
was therefore created and there was a real fear that it would be a basis for a revo-
lution. It was the problem posed by this surplus population that intentional
development set out to solve.
The Saint-Simonians were, according to Cowen and Shenton, the first to
construct a doctrine of development aimed at solving the problems they believed
had been created by an immanent process of capitalism. Followers of Henri de
Saint-Simon, they are mostly known for establishing much of what later become
known as positivist thought. Auguste Comte, the most well known of the Saint-
Simonians, and the one who coined the term positivisme, worked for a time as
Saint-Simon’s secretary, but later broke with his mentor and refused to acknowl-
edge his obvious intellectual debt to him.
The Saint-Simonians divided human history into organic and critical epochs:
the organic epochs represented periods of stability and social equilibrium, and
the critical epochs the unstable and destructive transformations between them.
For the Saint-Simonians, capitalism was such a critical epoch that needed to be
transcended: it had succeeded in destroying the old social equilibrium but had
not led to the transformation to a new equilibrium. The problem, as they saw it,
was that the means of production were in the hands of irresponsible capitalists
driven by narrow profit-seeking. When an opportunity arose in the market, all
capital would rush to the new niche, thereby creating a competition which would
destroy all but the strongest. This, according to the Saint-Simonians, was an
enormous waste of resources. Also, the capitalist system was ineffective because
there was no overall structuring of society’s resources. Thus when an industrialist
made a scientific discovery he would exploit it himself rather than make it
universally accessible. This lack of coordination led to a doubling of efforts
(Cowen and Shenton 1996).
The development discourse 15
The Saint-Simonians proposed a system of banks, headed by a national bank

that would control the means of production (Cowen and Shenton 1996). These
banks would then extend capital to those enterprises that were deemed worthy
by those acting as trustees for society. In this way, the central bank would have the
overall control of the rational planning of the productive efforts of the country.
It would be ‘the depository of all the riches, of the total fund of production, and
all the instruments of work’, in brief, ‘of that which today composes the entire
mass of individual properties’ (1996: 26). The regional branches of this central
bank ‘would be merely extensions of the first, by means of which the central
bank would keep in touch with the principal localities to know their needs and
productive power’ (ibid.). Development, then, was to come about as a result of
the intentional acts of those entrusted with the welfare of society, here represented
by the banks. Intentional development, Cowen and Shenton argue, was a strategy
originally aimed at solving the problems perceived as stemming from the imma-
nent development of capitalism. From its inception, the idea of development was
intimately concerned with the creation of stability and order, and further, devel-
opment was to come about as the result of the agency of elites.
The Bank realized

The system of banks proposed by the Saint-Simonians was never realized, but the
idea had some striking similarities with the multilateral development system that
emerged after World War II. The depression of the 1920s and 1930s had
convinced the allies of the importance of reforming international trade after the
war. Harry Dexter White, the first to propose a new economic world order based
on a Bank, was convinced that the US needed to reconstruct Europe, and create a
stable world market in the Third World to secure outlets for American products
(Caufield 1996: 40). This would necessitate huge investments abroad. A World
Bank, he reasoned, would be necessary to guarantee American investment.
Simultaneously, Keynes was drafting a plan for a new international economic
arrangement, based on a monetary union (ibid.). In 1945, after negotiations held
at Bretton Woods, Truman signed the Bretton Woods Agreements Act, thus
giving life to an institution which was an approximation of the idea suggested by
the Saint-Simonians. There were important differences, though: while the orig-
inal aim of the central bank suggested by the Saint-Simonians was to control all
productive means of the nation, the World Bank was set up to lend money to
developing countries. But the similarities were also striking, as we will see.
President Truman’s inauguration speech on 20 January 1949 is commonly
held to mark the beginning of modern development practice. There he held out
scientific and expert knowledge as the solution to a world divided by poverty:
We must embark on a bold new program for making the benefits of our
scientific advances and industrial progress available for the improvement
and growth of underdeveloped areas. For the first time in history, humanity
possesses the knowledge and the skill to relieve the suffering of these people
16 Knut G. Nustad
… our imponderable resources in the technical knowledge are constantly

growing and are inexhaustible. … The old imperialism – exploitation for
foreign profit – has no place in our plans. … Greater production is the key
to prosperity and peace. And the key to greater production is a wider and
more vigorous application of modern scientific and technical knowledge.
(quoted in Porter 1995: 66–7)
Truman was explicit about posing development as an alternative to communism, ‘the

false philosophy which has made such headway throughout the world, misleading
many peoples and adding to their sorrows and their difficulties’ (Caufield 1996: 48).
The Soviet Union had begun an industrialization process without adopting capi-
talism, and there was a real fear that Third World countries would follow the Soviet
example. Development was in part launched to counter such a move. Some were
more explicit about their political intentions than others. Rostow, for example, subti-
tled the work in which he introduced the stages of growth and the concept of
‘take-off ’, The Stages of Economic Growth: A Non-Communist Manifesto (Rostow 1961). After
spending the first half of the book outlining a universal model of the stages of
economic growth, through which all countries would have to progress, he becomes
explicitly political when he compares the Soviet Union with the United States:
Russia was deeply enmeshed in its own version of a traditional society, with
well-installed institutions of Church and State as well as intractable prob-
lems of land tenure, an illiterate serfdom, overpopulation on the land, the
lack of a free-wheeling commercial middle class, a culture which initially
placed a low premium on modern productive economic activity.
(Rostow 1961: 98)
The USA, on the other hand, was the conceptual negation of this situation:
‘The United States … was born free – with vigorous, independent land-owning
farmers, and an ample supply of enterprising men of commerce, as well as a
social and political system that took easily to industrialization, outside the South’
(ibid.: 98). The political dimension of development was stressed by McCloy, the
first director of the World Bank. He promised that the Bank would be good for
American Business, ‘it would create markets for U.S. trade … [and] stop
Communism’ (Caufield 1996: 53).
The Bank began with a strict focus on funding infrastructure in the countries
to which it lent. This approach, which later became known as modernization
theory, was most dominant in the 1950s and 1960s, but it is still influential today.
Modernization theory was based on the belief that the poorer nations would
eventually ‘catch up’ with the industrial countries. The remedy to their poverty
was an infusion of what Hart (2000) has labelled the ‘bourgeois package’: elites,
nation-states, capital, technology, democracy, education and the rule of law.
Enduring underdevelopment was explained in terms of ‘obstacles’1 to this ideal,
internal to the countries concerned, ideologically neutral and solvable by prag-
matic means (Gardner and Lewis 1996).
The stress on the creditworthiness of the potential lenders soon created prob-
lems for the Bank, however: it ran out of countries to lend to. This happened
both in its first years of operation and again in the mid-1960s. The predicament
of the Bank led to a change in policy: from a concern with huge infrastructure
programmes in the first decades, the Bank moved into the wider field of
economic policy, directly seeking to influence the economic policy of its
customers.
In the 1970s, it became increasingly clear that most of the debtor countries
had no hope of repaying their loans. Money was being spent on projects that
held no promise of future returns, or was stored away in international banking
accounts owned by development country elites. To prevent an international crisis
by defaulting loans, the so-called structural adjustment programmes of the
1980s, and their modified versions in the 1990s, sought to stabilize the situation
by supplying further loans to pay off interest on debt. This went, as Caufield
(1996) points out, directly against the original aim of the Bank. The granting of
these programmes was, as is well known, conditional on a restructuring of
economic policy in line with present neoliberal economic theory. The object of
the Bank’s operation has thus changed quite dramatically. From the granting of
loans to large infrastructure programmes to advance modernization, present
policies seem more concerned with stabilizing a world market than bringing
about the long awaited development.
The original idea behind the proposal of national banks set forth by the
Saint-Simonians found an expression in the World Bank in three important
ways: first, the initial importance attached to investment in production; second,
the implicit concern with order and stability and the forestalling of social unrest;
and third, the connection of an idea of development with trusteeship.
Development was from its inception intimately linked to the agency of elites:
experts and scientists were given the responsibility for guiding the development
of peoples seen as lacking it.
This version of development was challenged in the 1970s by a group of critics
who established another important connection with Saint-Simonian develop-
ment: the explicit link with capitalism. Like the Saint-Simonians, the
dependency theorists saw capitalism as the problem and the cause of underde-
velopment. But as we will see, their critique was trapped within the idea that
they criticized. Modernization theory had created a condition, ‘underdevelop-
ment’, that it set out to treat. Dependency theorists failed to question this
diagnosis, instead they set out to find its real cause.
Dependency theory: bringing capitalism back in

The neo-Marxist and dependency-oriented critique of development argued that
the First World ‘underdeveloped’ the Third World. Poverty was for them a polit-
ical process, the result of an exploitative, capitalist, world economic system
(Amin 1976; Frank 1967; 1978;2 Wallerstein 1974). In the North, Andre Gunder
Frank argued, the transition to capitalism separated producers from the means of
18 Knut G. Nustad
production, but this process was matched by one in which they were reabsorbed
into the production process as wage-labourers. This second process of reabsorp-
tion did not take place in the South (Cowen and Shenton 1996). What developed
in the South as an immanent process, according to Frank, was the process of
underdevelopment. The solution was therefore to withdraw from the capitalist
world system.
Other writers were concerned with the futility of intentional development.
They argued that capitalism was a reactionary force; the cause of poverty, not
the solution, thereby echoing the Saint-Simonian critique. A capitalist develop-
ment project thus became a contradiction in terms, and aid was seen as a means
of perpetuating exploitative economic structures (see for example Lappé et al.
1980; Hayter and Watson 1985).
But this critique shows the extent to which ‘development’ had established
itself as a hegemonic idea. It did not transcend the dichotomy of developed and
underdeveloped countries; instead the theory was concerned with discovering
‘the cause’ of ‘underdevelopment’. As Esteva puts it, ‘the very discussion of the
origin or current causes of underdevelopment illustrates to what extent it is
admitted to be something real, concrete, quantifiable and identifiable: a
phenomenon whose origin and modalities can be the subject of investigation’
(1995: 11). Manzo uses Derrida’s concept of logocentrism to make this point.
Logocentrism denotes cases where a hierarchy is imposed on familiar
dichotomies such as West and East, North and South, modern and traditional.
The first term in such pairs belongs to the realm of logos, of the given, that
which needs no explanation. The second term is defined solely in relation to the
first, as its inferior form. It is natural, therefore, that the East should become like
the West, the South like the North, the traditional like the modern (Manzo 1991:
8). According to Manzo, dependency theory, although challenging some of the
modernist assumptions of modernization theory, failed to break free of logocen-
trism:
Both [modernization theory and dependency theory] are trapped, albeit to

varying degrees, within a modernist discourse which relies on the principles
of nineteenth-century liberal philosophy, which treats the individual nation-
state in the Third World as the sovereign subject of development, and which
accepts the Western model of national autonomy with growth as the appro-
priate one to emulate. Because of this, the ‘developed state’ might be
understood in both developmentalism and dependency as analogous to
‘reasoning man’ at the center of modernity, and the relationship between
core/peripheral or modern/traditional states as implicitly akin to that
between parent and child.
(Manzo 1991: 6)
Dependency theory not only replicated the dichotomy of ‘developed’ and

‘underdeveloped’, it also reinforced the importance of elites in development.
According to Hobart (1993), it replaced the idea of expert knowledge of devel-
opment with an expert knowledge of underdevelopment. The underdeveloped

could not understand the intricacies of the system that exploited them, and they
were therefore unable to change it. The cause of underdevelopment was placed
in factors external to the countries concerned. Here lay the weight of the criti-
cisms raised against dependency theory: it subsumed local processes and
distribution of wealth into a world-dominating system.
The object created by the World Bank as the single condition underlying all
problems in the Third World, ‘underdevelopment’, was therefore further
strengthened and made real by the critique of the dependency theorists. This
division of the world into ‘developed’ and ‘underdeveloped’ has, however, been
criticized in recent years. Through this dichotomy, Esteva (1995: 7) argues, ‘two
billion people ceased to be what they were, in all their diversity, and were trans-
formed into a mirror of others’ reality’. In mainstream development literature,
Escobar holds:
there exists a veritable underdeveloped subjectivity endowed with features

such as powerlessness, passivity, poverty, and ignorance, usually dark and
lacking in historical agency, as if waiting for the (white) Western hand to
help subjects along and not infrequently hungry, illiterate, needy, and
oppressed by its own stubbornness, lack of initiative, and tradition. This
image also universalizes and homogenizes Third World cultures in an ahis-
torical fashion. Only from a certain Western perspective does this
description make sense; that it exists at all is more a sign of power over the
Third World than a truth about it.
(Escobar 1995a: 8–9)
The conceptual pair of development and underdevelopment is therefore seen

as mutually constitutive. The idea of development was established as the practice
of addressing a problem, underdevelopment. It follows then, that a critique of
the universal diagnosis of all the problems of the world (hunger, poverty, etc.) as
resulting from underdevelopment, inevitably leads to a questioning of the idea of
development itself. The question, then, is whether the idea of development can
or should be salvaged. Below I will argue that a new and less dominating
conception of development is unlikely to emerge within the institutional setting
in which development now exists.
The role of ideas: can the idea of development be

reformed?3
My doubt as to a fundamentally different idea of development arising within the
multilateral development system is rooted in a conception of forms, and I want
to pursue this argument by help of an analogy: the ideas of ‘justice’ and ‘popular
justice’. If we treat these two terms as analogous to development, as it is now
practised, and a possible future true development, respectively, the exchange
between Foucault and a Maoist about the possibility for reforming the present
20 Knut G. Nustad
juridical system to an expression of popular justice after the revolution can

clarify our thinking. Foucault argues that the judicial system cannot be adapted
to a true expression of the will of the people (Foucault 1980). He points out that
acts of popular justice in France and elsewhere in Western Europe have been
profoundly anti-judicial, that the expressions they have been given are contrary
to the very form of the court. This is because the form of the court, Foucault
argues, is an expression of a bourgeois idea of justice. He asks us to consider the
physical layout of a court:
a table, and behind this table, which distances them from the two litigants,
the ‘third party’, that is, the judges. Their position indicates firstly that they
are neutral with respect to each litigant, and secondly this implies that their
decision is not already arrived at in advance, that it will be made after an
aural investigation of the two parties, on the basis of a certain conception of
truth and a certain number of ideas concerning what is just and unjust, and
thirdly that they have the authority to enforce their decision.
(1980: 8)
The assumptions on which the physical layout of the court is based, that it is
an expression of, is therefore in Foucault’s view foreign to the very idea of a
popular justice. It is this predominance of form that can be carried over to an
examination of development. As the idea of popular justice involved a transfor-
mation of the old system for the Maoists, development organizations have in the
last decade argued for a reformed development that has its origin in people’s
concerns. This bottom-up development seeks to avoid the failings of both
modernization theory and dependency theory. We are presented with an image
where development grows out of ‘grassroots’ concern, assisted and facilitated by
development experts.
These theories advocate a transfer of power from experts to the people
themselves. Thus the Human Development Report issued by the UNDP in
1993 states that in the face of the current challenges to development ‘the best
route is to unleash people’s entrepreneurial spirit – to take risks, to compete, to
innovate, to determine the direction and pace of development’. After informing
us that this year’s report has people’s participation as its special focus, the
authors go on to declare that ‘people’s participation is becoming the central
issue of our time’ (quoted in Mayo and Craig 1995: 2). A more radical
approach is associated with the NGO sector: in addition to advocating an inclu-
sion of the people to be developed in the process, they also argue for a transfer
of power. Their task, as they see it, is one of ‘empowerment’. Thus Nelson and
Wright have argued that ‘participation’ must involve a shift in power to be more
than a palliative (1995: 1). This shift involves an integration of local knowledge
in the development process. In the same spirit, Edwards (1989) argues that
development studies have been irrelevant to the practice of development since
they are based on expert knowledge. The solution, he argues, is to deploy
participatory research methods.
But using the language of participation does not in itself constitute a trans-
ferral of power (Nustad 1996; 1997). As Porter (1995) has pointed out,
development since Truman has been the domain of technocrats, and with the
construction of a technocratic discourse followed a denial of human agency.
Hobart (1993) argues that the notion of the expert is closely related to what he
calls the ‘growth of ignorance’ in the local population; the belief that an outside
expert monopolizes the search for solutions presupposes the ignorance of the
people she or he is helping.
This, then, is similar to the point made by Foucault. In the same way that the
form of the court was the expression of a certain conception of justice, so the
apparatus of development is, as Cowen and Shenton have pointed out, built on
an idea of trusteeship. This was not a problem when intentional development
was conceived as a state practice in the first half of the nineteenth century. At
that time, those who saw themselves as developed self-consciously took it upon
themselves to guide those who were less developed. This understanding of an
elite-driven development was also carried into World Bank practices. The
problem arises because the proponents of a bottom-up development argue for a
rejection of trusteeship, yet this notion is embedded in the idea of intentional
development. Cowen and Shenton (1996: 4) call this a tautology: ‘Logically, the
confusion arises out of an old utilitarian tautology. Because development, what-
ever definition is used, appears as both means and goal, the goal is most often
unwittingly assumed to be present at the onset of the process of development
itself ’. According to them, to speak of ‘bottom-up development’ is to confuse
the means and the goals of development. To assume that people have the
knowledge necessary to guide their own development is to assume that they
have reached the vantage point of a position that is commonly referred to as
developed (ibid.).
The form of development therefore implies an idea of trusteeship: that
someone who has the necessary vantage point guides the process of develop-
ment. This is why I remain sceptical of attempts to reform the development
apparatus to achieve a ‘true’ development from the bottom. For this reason,
proposals for reform look more like recapitulations of old efforts than true
attempts at reform. Culpeper (1997: 3), for example, argues that ‘problems such
as overpopulation, global warming and environmental collapse, mass poverty …
can only become more common in the absence of a rule-based, rule-abiding,
and cooperative global community’. This community, further, ‘requires viable
and effective institutions to act on behalf of the common interest’ (ibid.). As
should be clear from the above, this is in effect a reinstatement of the trustee.
The common interest referred to is the enlightened understanding of an elite.
The future of the idea of development

This is not a call for abandoning the academic interest in development and to
bury the idea. There is, however, a need for a new focus. Discourse analysis of
development has so far focused on the development apparatus, and this has
22 Knut G. Nustad
indeed been an important first task. But by focusing the analysis on the practi-
tioners of development and how they construct their object through the
discourse of development, the reactions of the people to be developed are
neglected (Nustad 1999). Much of this writing depicts development as a
coherent system imposed on a passively receptive target population. What is left
out of the account are the responses of the people thus constituted. Thus Kiely
argues that ‘post-development discourse tends to imply a passive Third World,
simply having its strings pulled by an all-powerful West’ (1999: 48). Kiely is not
alone in this critique. It is rather an instance of a critique that has been levelled
against discourse analysis more generally. The Italian Marxist and journalist
Trombadori criticizes Foucault for a ‘lack of individuating real subjects who are
capable of determining a relation of power: in the context of the tension of a
discursive formation or of a particular apparatus in which knowledge and power
are intertwined’, he asks, ‘who struggles against whom?’ (Foucault 1991: 18–19).
Everett (1997) has also argued along this line, pointing out that post-
structuralists have ignored the agency of local elites as well as of ‘target popula-
tions’. She introduces us to the example of a development project in Bogotá,
Colombia, where the local elite used the language of ‘sustainable’ and ‘participa-
tory’ development to secure their interests (controlling the spread of squatting
near the city). She demonstrates that the residents were not fooled by this
rhetoric. Instead they understood what was going on and mobilized against the
development project. From this she argues that the post-structuralist critics of
development ‘have largely failed to reveal the agents of this repressive system. By
leaving out or simplifying agency, they portray development as both more unified
and more powerful than it is’ (Everett 1997: 147). She agrees that those involved
might misunderstand the consequences of development, but goes on to say that
‘this fact does not mean that conscious actions and motivations have no role in
shaping development interventions’ (ibid.). Although she overstates the case, she
has a valid point.
I believe that discourse analysis can be usefully extended by grounding it in
the social reality from where the analysis began. This is also in line with
Foucault’s conception of power as he expressed it in The History of Sexuality,
where power is seen as emanating ‘from the bottom’, as relational and intrinsic
to other social relations (Foucault 1976). Instead of focusing on the institutions
that have established a monopoly on the idea of development, we need to look to
social groupings striving to bring about change outside the established institu-
tional network. A good place to begin, I believe, would be the groups targeted by
development projects. An examination of how people resist, undermine or use
development interventions for their own ends will provide a useful contrast
between institutional and popular approaches to change. Where better, then, to
look for the ‘power’ in development than in concrete development encounters?
This, indeed, is work that is being addressed at the moment (see for example
Arce and Long 2000).
This does not, of course, supply an answer to those who want to salvage post-
development by deriving from it new ways of practising development. As I have
argued, I do not see this as a task for critical development theory. This does not
mean that nothing should be done about the problem which development
discourses have colonized. Poverty is a very real problem. But I think it unlikely
that the institutions that have so far made this problem their own, who for at
least fifty years have supplied a shifting stream of solutions and remedies to it,
are likely to solve it. Discourse analysis has helped clarify the problems with the
development apparatus.
Where, then, is the solution to poverty going to come from? To continue the
analogy with Foucault’s discussion of popular justice, where the form of the
court embedded an idea of bourgeois justice, it follows that an expression of
justice that was truly popular would be very different in form than the court. It
would probably not even be recognized as an expression of popular justice by
those working within a court; and had a new court been set up, based on its prin-
ciples, the form would have corrupted the content. The same, I believe, holds for
development. Many critics of post-development have argued that putting one’s
faith in social movements is subject to both romanticism and naivety. But as I
have argued, their call for practical solutions rests on the assumption that the
apparatus now in place has the capacity for delivering a solution.
Notes
1 One example from anthropology is George M. Foster’s (1962) description of ‘the
peasant image of limited good’ as an obstacle to development.
2 Dependent Accumulation and Underdevelopment was written, according to the author in the
preface, between 1969 and 1973.
3 The following two sections draw heavily on an article published in Third World
Quarterly (Nustad 2001).
3 Contesting policy ideas from
below
Norman Long
Introduction
Our lives are more than ever shaped by the global ideas and practices of multi-
lateral organizations. The work we engage in, the incomes we receive, the
commodities we consume, the goods we manufacture, the lifestyles we pursue,
and the cultural identities we don, are all partly made possible, regulated and
often transformed by the policy decisions, programmes, procedures and propa-
ganda emanating from a core of multilaterals such as the World Bank, IMF and
WTO, as well as – for many other people – from UN agencies such as the United
Nations High Commission for Refugees (UNHCR). Much of this goes unnoticed
until critical events affect us directly: for example, the laying-off of workers in
industries that are no longer considered to have ‘comparative advantage’ in the
global economy, or the failure of resource-poor rural and urban households to
make ends meet in times of economic stringency and market volatility, or when
the trading of certain goods is suspended because they fall below internationally
defined quality standards, or when individuals are refused entry visas for a
particular country due to the enforcement of strict immigration quotas. It is, of
course, the poorer nations and social sectors that are disproportionately affected
by these kinds of problems and processes.
Multilateral organizations such as the World Bank, IMF and WTO are
constantly issuing pronouncements about their mandates, successes, promises for
the future, and offering explanations for programme shortfalls, changes in direc-
tion, the continuance of controversial projects, and so forth. What is perhaps
especially striking is that, despite differences in their responsibilities, operational
domains and administrative make-up, they frequently convey a degree of
consensus when it comes to more general goals and means of development. That
is, they espouse a broadly common economic and political rationality. In the
present era, this amounts to being a paid-up member of the neoliberal club of
market-led development thinkers who assign the state a much reduced role in
initiating and steering development, as compared to the space allotted to private
enterprise and civic associations, both local and global. They are also dedicated
to ordering the global economy through the establishment of formal rules for
governing the commodity flows and financial exchanges that link countries,
Contesting policy ideas from below 25
enterprises, producers and consumers. And over the last decade they have
adopted the languages of ‘good governance’, ‘participatory development’ and
‘empowerment’ through civic associations to give greater credence to their policy
agendas and to fend off their critics.
From this arise two central questions, namely where do these authoritative
and influential ideas come from and how exactly are they transmitted and incor-
porated into the institutional thinking of specific multilaterals? Also, how do
multilateral organizations share their ideas and experiences with each other in
such a way as to create common ground in thinking and practice; or are these
similarities only skin-deep, leaving many areas of disagreement, if not conflict?
These and other similar questions are explored in several of the contributions
to this volume. On the basis of this, one can reach some empirical conclusions
about the commonalities and differences between particular multilateral organi-
zations. One should also be able to trace the origins, flows, transformation and
consolidation of specific ideas and policies.
Yet, while all such dimensions and questions clearly merit systematic research,
a necessary prior step involves taking a position on what exactly are ideas and
how can we research them. Although seemingly a semantic problem, it is crucial
that we situate the issue of ideas more generally in relation to processes of
knowledge production and transformation. This lies at the heart of under-
standing how ideas travel, are relocated and reconstituted to acquire new
meanings. The theoretical position I take – namely an actor-oriented/social
constructionist view – can, I believe, offer a useful perspective on knowledge
production and dissemination in respect to the policies and practices of multilat-
eral organizations.
A further requirement for the elaboration of my argument – and one which is
highly pertinent to the recent upsurge of global protest against the policies and
ideologies of the World Bank, IMF and WTO – is that we must widen our
perspective beyond the domains of policy making, academic research and devel-
opment practice to include also all those actors (often considered ‘non-experts’)
who are affected, directly or indirectly, by the actions of multilateral organiza-
tions and who, through their own actions, may themselves significantly mould
the thinking and strategies of such organizations.
Expert domains and public policy

Discussions on the role of ideas in multilateral organizations mostly draw atten-
tion to the specific contributions made by recognized academic policy experts or
schools of thought, such as ‘Chicago’. The process is facilitated by the fact that
organizations like the World Bank actively cultivate close links with academics
(mostly economists on short- or long-term contracts) for advice on development
policy and implementation measures. Of course, in the end, the particular poli-
cies and strategies adopted will have been significantly shaped by the strong
presence and lobbying activities pursued by the more powerful coalitions of the
US and European board members.
26 Norman Long
On the other hand, much less attention has been given to providing a full
account of all the many circuits and flows of ideas that pass through and around
the offices of the Bank or similar organizations. These diverse ideas are an
important part of the everyday attempts of staff at various levels to accommo-
date the policy directives and to translate and concretize them in specific
procedures and practices. It is also notable that almost nowhere do we find
accounts of how everyday, non-expert or lay forms of knowledge and practice
(both within and outside the Bank) influence these same activities, strategies and
policies.
While several contributors to this volume attempt to fill these gaps by concen-
trating on the impact on multilaterals of certain key theoretical and ideological
concepts, and others probe the internal politics of policy and administration, this
chapter highlights the importance of considering how other actors, stakeholders
and beneficiaries, engage with the ideas and actions of multilateral organiza-
tions. I am especially interested, therefore, in making the point that we also need
to understand how ideas are transmitted, contested, reassembled and negotiated
at the points where policy decisions and implementations impinge upon the life
circumstances and everyday lifeworlds of so-called ‘lay’ or ‘non-expert’ actors.
What exactly are ideas?

In pursuing this line of inquiry, we must acknowledge the difficult conceptual
problem of dealing with ideas. Some recent discussions simply attempt to resolve
this empirically by distinguishing descriptively between various categories of
ideas (e.g. theory, ideology, perceptions, principles, attitudes and values). Here,
ideas are usually equated with mental events and refer to particular beliefs held
by large numbers of people. Viewing ideas in this way leaves us with the problem
of throwing together in the same basket all manner of ideas – from small atoms
of information to organized worldviews or ideologies. Moreover, the stress on
beliefs does not solve the problem either, because it often fails to distinguish
between highly personalized beliefs that arise out of biographical experiences,
and more institutionalized belief systems associated with membership of partic-
ular believer communities, whether religious or secular in nature. A bigger
problem with this rag-bag of ideas and cultural beliefs is that each item is
conceived of as some kind of object that can be detached from its practice and
applied across the board. As I argue later, we need, through the notion of
discourse, a way of contextualizing better the interconnections between ideas,
beliefs and action.
Another problematic issue is the fact that interests are often seen as distinct
from, rather than shaped by, ideas; they are usually assumed to come first and
are considered therefore more foundational. As Laffey and Weldes (1997) rightly
point out, this stance obstructs inquiries into the construction of interests. That
is, interests are taken as ‘given’ and in isolation from ideas. Interests are non-
ideational and somehow determined independently as if they come prior to
ideas and beliefs. This position is often implicitly (if not explicitly) accepted by
several schools of thought (both Marxist and non-Marxist). Despite the now-
extensive literature on the interweaving of ideas, beliefs, interests, identities and
social practice, the tendency persists (among policy makers in particular) to
conceive of ideas as ‘tools’ to be used in the manipulation of various critical
audiences (e.g. international elites, government bureaucrats and organized
citizen groups).
As an alternative to these views, Greenblatt (1991) has proposed that we view
ideas as ‘symbolic technologies’. Although his use of this term might be ques-
tioned since it seems to resonate with the instrumentality of applied science, it
does embrace the notion that ideas constitute and are constituted by forms of
social action. Or, as he puts it in a more intricate way, symbolic technologies are
‘most simply inter-subjective systems of representations and representation-
producing practices’. Thus they are co-produced (though not necessarily
‘collective’) forms of practice or ‘sets of capacities with which people can
construct meaning about themselves, their world and their activities’ (Laffey and
Weldes 1997: 210). As capacities they enable and make possible certain kinds of
action or ‘ways of being in the world’, and they also constrain or preclude other
types of meaning and action. They also constitute forms of power through their
capacity to produce or contest certain cultural representations. This focus on
practices implies therefore that ideas cannot be conceptualized as discrete mental
events or objects; nor should they be seen as separate from, but rather as consti-
tutive and productive of, interests.
Knowledge production, dissemination and

transformation
This social practice approach to understanding the production and dissemina-
tion of ideas has an affinity with discourse analysis, which concerns itself with
how ideas are assembled and knitted together by means of framing and
promoting (often contested) ‘truths’ or meanings. Both formulations emphasize
the centrality of situated practical ‘texts’ and contexts, rather than abstract
systems of thought or rationality.
Discourse analysis offers a useful way of exploring the significance of particular
ideas and cultural repertoires and how they interact and interpenetrate situation-
ally (see Long 2001: 50–3). By discourse is meant a set of meanings embodied in
metaphors, representations, images, narratives and statements that advance a
particular version of ‘the truth’ about objects, persons, events and the relations
between them. Discourses produce texts – written and spoken – and even non-
verbal ‘texts’ like the meanings embodied in infrastructure such as asphalt roads,
dams and irrigation schemes, and in farming styles and technologies.
Discourses frame our understanding of life experiences by providing repre-
sentations of ‘reality’ (often taken-for-granted) and shape or constitute what we
consider to be the significant or essential objects, persons and events of our
world. It is, of course, possible to have different or conflicting versions of the
same discourse or incompatible discourses relating to the same phenomena. For
28 Norman Long
example, discourse on development varies considerably depending upon the

political or ideological positions of the organizations or actors involved.1 As
Escobar (1995b) shows in his account of the term, ‘development’ has its roots in
the post-Enlightenment obsession for ‘progress’, ‘social evolution’ and the pursuit
of ‘modernity’. Following the Second World War, the idea of development as a
form of social engineering, geared to designing and actively transforming so-
called ‘traditional’ societies through the injection of capital, technology, and
forms of bureaucratic organization, was added to the vocabulary of progress.
This marked the beginnings of the period of massive state and international
intervention in the ‘developing countries’, when development became largely
synonymous with planned development and the aid industry. As Escobar (1995b:
213) explains:
From this perspective, development can be best described as an apparatus

that links forms of knowledge about the Third World with the deployment
of forms of power and intervention. … By means of this discourse, individ-
uals, governments and communities are seen as ‘underdeveloped’ and
treated as such. … This unifying vision goes back only to the post-war
period, when the apparatuses of Western knowledge production and inter-
vention (such as the World Bank, the United Nations, and bilateral
development agencies) were globalized and established their new political
economy of truth.
Embodied in this history of development intervention were powerful narra-

tives and images that represented the world in a particular way, offering a
diagnosis of problems and their solutions. Although the general outcome was the
widespread dissemination of ‘Western’ ideals and technology, resulting in post-
colonial modes of exploitation, it also sowed the seeds for the emergence of
counter-discourses that challenged established views and proposed alternatives to
Western paradigms of development. The above text from Escobar also clearly
hints at the existence of such countervailing discourses among subordinate
groups, thus pointing to the significance of multiple discourses.2
It is important to unravel the discourses utilized in specific arenas of struggle,
especially where actors vie with each other for control over resources in defence
of their own livelihood concerns. As I emphasized above, it is essential to recog-
nize that discourses (like Greenblatt’s ‘symbolic technologies’) are not separate
from social practice – hence the use of the phrase ‘discursive practice’ in the
writings of Foucault (1972). Another critical point is that discourses may co-exist
and intersect with each other, but may not always be fully elaborated in the form
of abstract arguments, such as we find in formal plans or policy documents
drawn up by development agencies or issued by other stakeholder groups. More
often, bits and pieces of discursive text are brought together in innovative ways,
or in strange combinations in particular situations, in order to negotiate or
contest certain shifting points of view. Indeed, the multiplicity and fragmentation
of discourses, especially in conversational and dialogical exchanges, is more
often the case than the clash of well–defined opposing viewpoints, beliefs or
rationalities. This also holds for the rhetorical content of official government
statements drawn up by politicians and their ‘spin doctors’.
On this basis one might argue that the advancement of any particular
discourse depends on the strategic use of other discourses. This is illustrated, for
example, by the way in which neoliberal policy statements with their stress on
‘letting the market do its job’ are now often accompanied by discourses that
emphasize issues of ‘equity’, ‘participation’ and the problems of ‘marginaliza-
tion’. Indeed, structural adjustment measures have, in turn, given rise to ‘social
compensation’ policies aimed at protecting the badly affected poorer and weaker
social sectors. The World Bank, along with various national governments, has
eventually been obliged to introduce the latter in order to counterbalance the
growing evidence of marked decline in incomes and living conditions among
these poorer sectors.
This brings out the important point that shifts in policy discourse and priori-
ties are not simply provoked by the challenge of alternative development ideas or
theories, but often by critical events that dramatically reveal the striking discrep-
ancies that exist between the stated policy objectives/expectations and actual
outcomes and social conditions. I will later return to this when I describe the
new social movements that now act globally as a vanguard for change, using
elaborate counter-discourses against various multilateral organizations such as
the World Bank, International Monetary Fund and World Trade Organization,
which they see as ‘hegemonic’ organizations.
Another self-evident but nonetheless crucial observation is that, although
discourses may be said to ‘belong’ to organizations such as the state, the World
Bank or the local community, it is actually specific actors (i.e. persons acting on
behalf of themselves or as representatives of organizations or informal groups)
who deploy them and recast them. Or, more precisely, it is the encounter
between, or confrontation of actors and their ideas and values (such as farmers,
extensionists, agricultural scientists, traders, international development experts
and managers of transnational companies) that perpetuates or transforms partic-
ular discourses. Adopting such an actor-oriented approach is a good way to
understand these processes, since it places emphasis on situated social practice,
and provides a methodology for analysing discursive practice and development
interface situations (for a full account of this theoretical perspective and its signif-
icance for development research, see Long 2001).
Escobar argues that the power of dominant representations of development is
grounded in the way in which
[t]hird World reality is inscribed with precision and persistence by the

discourses and practices of economists, planners, nutritionists, demogra-
phers, and the like, making it difficult for people to define their own interests
in their own terms – in many cases actually disabling them from doing so.
(Escobar 1995b: 216)
30 Norman Long
An equally compelling view is that – in respect to specific issues such as sustain-

ability, human rights, environmental pollution and health hazards – many groups
(local and global) now contest expert views and are creating new discursive and
political space for advancing ‘counter-development’ arguments (see Arce and
Long 2000; Huq 2000). Actor-oriented analysis is especially appropriate for
disentangling the complexities of these struggles at both the level of social action
and of meanings and values.
The diffusion of development ideas – certainly from academia to the power-
houses of international development policy – is often viewed as a relatively
neutral, value-free process. That is, it is assumed that the most rational and
convincing policy approaches are likely to be accepted. Of course this is an
idealist view and ignores all the realpolitik of knowledge production and dissemi-
nation. As sociologists of science have forcefully shown, the diffusion and
acceptance of particular ideas and findings depends crucially on the presenta-
tional skills of the scientists and the effectiveness of the organizations that they
work for in transmitting and persuasively promoting (‘selling’) their knowledge
products. As Latour’s study of Pasteur and his laboratory vividly records, the
right political and commissioning networks were essential for obtaining the
necessary backing for the follow-through of experimentation (Latour 1988).
Likewise, it seems that the ‘Chicago School’, the IDS (Institute of Development
Studies) in Sussex, and other so-called ‘blue-chip’ development and research
organizations have, through the close interpersonal networks of their senior staff,
been able to reach out and influence policy making within multilateral circles,
and concomitantly secure financial support for their own ventures from national
(e.g. the Department for International Development, UK) and international
bodies (predominantly the World Bank). We also witness the emergence of
network consortia made up of a number of policy research units that respond to
tenders for contracts put out by multilateral organizations. In addition to the
institutional and network strengths that these applicants may have, each organi-
zation or group develops its own distinctive ‘in-house’ styles of research and
policy discourse, which for the large part are geared to attract the attention of
specific donors. In this respect, it has often been difficult for less well-connected
groups with more open-ended and challenging agendas to make much headway.
As ever, much depends on whether one can adjust one’s points of view and line
of work to fit in with current dominant development discourse. In this way the
assessment of implemented programmes and the production of new policies are
kept within established expert domains in which senior advisors play a key role.
Yet, although these political continuities are real enough, we must also note
certain changing circumstances. As the years have progressed from the imme-
diate post-Second World War situation dominated by the search for the magic
formula of modernity with economic growth, to the much more insecure, risky
and politically volatile situation of the 1980s onwards (marked by a realization
that poverty was actually widening despite the efforts of international aid organi-
zations, and by a concern for the deteriorating environmental situation and the
negative outcomes of certain technological fixes), policy debates became
anchored to how best to alleviate poverty without destroying the potential motor
of development brought by technological innovation and well–placed financial
injections. However, in many cases these efforts seemed to go nowhere. The
reasons for this were manifold, but clearly linked to the persistence of an already
established/entrenched group of experts and a well–organized, behind-the-
scenes manipulative lobby of powerful post-industrial countries. Thus, roughly
the same sets of interests guided the major policy shifts and the funding of devel-
opment initiatives.
However, the world is now affected by the impact of globalization, rapid
developments in information technologies and electronic communication systems
and the advent of digitally organized internet facilities. While the powerful blocs
of advanced capitalist states have been able to use these technologies to their
best advantage, at the same time the internet has given life to a new sense of
global communities, and has thus given local and civil-based organizations the
chance to put their own points of view more forcefully and to enter the policy
debate. This is combined with the use of more aggressive tactics for getting
people onto the streets to engage in direct protest and confrontation with the
organizations responsible for international agreements on environment, trade
and finance. Here we should note the Seattle meeting of the World Trade
Organization and the Prague meeting of the World Bank and the IMF. These
street protests and attempts to force multinational organizations to debate with
NGOs and other grassroots organizations and single-interest groups such as
Greenpeace, together signify a new more global and heterogeneous people’s
movement, not based on existing recognized political bodies with specific aims
and mandates, but on a more diffuse and self-organizing and transforming modus
operandi. That these global counter-development movements are real in their
actions and effects is seen by the various U-turns made recently by some of the
world bodies. Note, for example, the somewhat surprising admission by the
World Bank that structural adjustment and similar measures have not been able
to address effectively the persisting patterns of poverty and the widening gap
between rich and poor in the global scene. But whether this will result in
concrete policy and implementation measures remains to be seen.
This emphasizes the point that discourses and strategies from below can be
brought to bear on multilateral organizations. However, we must acknowledge
that in fact there have always been counter-development discourses. Sometimes
these have been couched in very general terms, such as questioning certain core
values and practices of modernity (often backed by recourse to traditional coun-
terpoised views and institutional forms). At other times they have been rooted in
more localized experiences of the effects of particular development policies and
programmes of intervention. Hence, there has always been an ongoing critique
of development practices and institutional ordering, as local people have sought
space for change, sometimes aligning with local development workers and NGOs
to exert pressure on the agencies of the state.
Before proceeding further with the discussion of counter-development
processes, let me first provide a sketch of the centrality of knowledge and the
32 Norman Long
role of ideas in the sociology of development. Through this I hope to provide a

general rationale for considering the impact of non-expert lay knowledge and
ideas on expert domains, bearing in mind the interest we have in addressing
multilateral institutional ideas and practices. In order to do this we need to
conceptualize the transmission and transformation of ideas and certain modes of
discourse. I concentrate upon developing an actor-oriented perspective on this.
After this I will illustrate briefly how one applies this to an extreme case of exter-
nally driven development that presents a set of major contradictions for
dominant development thinking.
The rise of knowledge issues in the sociology of

development
From about the early 1960s onwards, a number of social scientists interested in
the theorization of uneven development, the transfer of technology, and the
significance of cultural and institutional factors, turned towards modernization
and, later, political economy models for an explanation of the dynamics of social
transformation. While these approaches provided some important new insights
into issues of class, ‘traditional’ versus ‘modern’ values, the role of the state and
international capital, and thereby touched upon questions of power and knowl-
edge, they failed to recognize the fundamental significance of ‘expert’ knowledge
or science in the social construction of society and social change.
Knowledge and science were part of both modernization and neo-Marxist
discourses, but they were perceived primarily as ‘resources’ and as part of the
‘tool-kit’ of a ‘modernity’ project aimed at isolating the central driving forces
and mechanisms of social change.
Later, sociologists concerned with issues of popular education argued that
‘external’ forms of knowledge needed translation in order to become effective in
local development. These translation tasks were the mission of so-called ‘popular
promoters’, animators, ‘change agents’, and the like, whose assignment was
linked to the overall goal of using knowledge for transforming society in an effort
to achieve greater equity and political participation (see for example Freire 1970;
Galjart 1980; Fals-Borda 1981). In this way the worlds of research and develop-
ment practice became interconnected through the discussion of how to organize
and use knowledge and science appropriately.
More recently, the sociology of knowledge has embraced a social construc-
tivist perspective which provides fresh insights into how ‘expert’ and everyday
forms of knowledge relate to development processes. For instance, Knorr-Cetina
(1981), studying ‘practical epistemologies’ within science, has shown how expert
scientific knowledge is produced and re-created not simply in the laboratories of
research organizations, but also in the canteens and corridors of scientific estab-
lishments. Parallel views within the field of development studies have been
expressed by Robert Chambers (1983) and Paul Richards (1985), who argue that
the practical everyday knowledge of ordinary people can enrich ‘science’ and
improve development practice. Thus two rather different research strands
converge in insisting that rather than exploring the nature and epistemology of
knowledge in an abstract and formalist manner, we should open the path to a re-
evaluation of science-in-the-making. Such a perspective takes full cognizance of
social actors, their values and understandings in the construction of knowledge,
and in the scientific design for alternative or competing ‘projects of society’. It
also takes a stand against treating science and everyday knowledge as being onto-
logically different.
The demystification of science through the ethnographic study of scientific
practice and everyday knowledge brings into perspective a whole new set of
images and representations of how the social world is constructed and orga-
nized. From this new standpoint, a fresh panorama unfolds where the interplay
and interfaces of local people and scientists become central to the production of
more acceptable and ‘human’ solutions aimed at countering the ‘supremacy’ and
‘excesses’ of modern technological and economic development.
These various attempts to study and analyse expert science, scientists’ interests,
and people’s knowledge and aspirations opened the way to detailed ethnographic
studies on how knowledge is created and used by all sorts of actors in their prac-
tical attempts to cope with issues of livelihood and planned intervention by
outsiders. But the creation and transformation of knowledge, we argue, can only
effectively be studied and analysed through an appreciation of how people –
whether peasants, bureaucrats or scientists – build bridges and manage critical
knowledge interfaces that constitute the points of intersection between their
diverse lifeworlds (Arce and Long 1987; Long 1989). This requires paying close
attention to the practices of everyday social life, involving actor strategies,
manoeuvres, discourses, speech games, and struggles over identity networks and
social imagery, since only in this way can one tease out the intricacies of how
knowledge is internalized, used and reconstructed by the different actors. It is in
this way that an actor-oriented perspective on knowledge and knowledge encoun-
ters can help us go beyond earlier social constructivist views which tend to suggest
a dichotomized representation of different forms of knowledge (i.e. in terms of
‘modern science’ versus ‘people’s science’, ‘external’ versus ‘local’ knowledge).
This new focus concentrates upon exploring how practices are organized
cognitively and enacted in everyday performances, not as self-contained cultural
or institutional systems of social thought that frame or guide behavioural
response. An actor-oriented perspective refuses to draw sharp distinctions
between different kinds of knowledge on the basis of their origin, pedigree and
so-called authority. Knowledge is generated and transformed not in the abstract
but in the everyday contingencies and struggles that constitute social life. It is not
given by simple institutional commitments or assumed sources of power and
authority, but rather is an outcome of interactions, negotiations, interfaces and
accommodations between different actors and their lifeworlds.
The lack of commonality in the concept of knowledge (i.e. the contradictions,
inconsistencies, struggles and negotiations that it implies) means that there are
many different intersecting knowledge frames – some more diffuse and frag-
mented than others – that intersect in the construction of social arrangements
34 Norman Long
and discursive practices. These ‘multiple realities’ may mean many things and
entail different rationalities at the same time to the actors involved, but somehow
they are contained and interact within the same social context or arena. It is
these knowledge encounters and interactions that generate locally situated
knowledge.
Knowledge as an encounter of horizons

By the late 1980s, researchers began to pinpoint certain critical limitations in the
linkage approach, or what has been designated ‘the transportational paradigm’,
to understanding knowledge processes. The model assumes that the process of
knowledge dissemination/utilization involves the transfer of a body of knowl-
edge from one individual or social unit to another, rather than adopting a more
dynamic view that acknowledges the joint creation of knowledge by both dissem-
inators and users. This latter interpretation depicts knowledge as arising from a
fusion of horizons, since the processing and absorption of new items of informa-
tion and new discursive or cognitive frames can only take place on the basis of
already existing stocks of knowledge and evaluative modes, which are themselves
reshaped by the communicative experience. Moreover, although knowledge
dissemination/creation is in essence an interpretative and cognitive process,
entailing the bridging of the gap between a familiar world and a less familiar (or
even alien) set of meanings, knowledge is built upon the accumulated social
experience, commitments and culturally acquired dispositions of the actors
involved.
Hence,
communicative action is not only a [cognitive] process of reaching under-

standing; in coming to an understanding about something in the world,
actors are at the same time taking part in interactions through which they
develop, confirm, and renew their memberships in social groups and their
own identities. Communicative actions are not only processes of interpreta-
tion in which cultural knowledge is ‘tested against the world’; they are at the
same time processes of social integration and socialisation.
(Habermas 1987: 139)
Processes of knowledge dissemination/creation simultaneously imply, there-

fore, several interconnected elements: actor strategies and capacities for drawing
upon existing knowledge repertoires and absorbing new information; validation
processes whereby newly introduced information and its sources are judged
acceptable and useful or contested; and various transactions involving the
exchanges of actors involved in the production, dissemination and utilization of
knowledge.
Such cases lend support to the argument that so long as we conceptualize the
issues of knowledge dissemination/utilization simply in terms of linkage
concepts, without giving sufficient attention to human agency and the transfor-
mation of meaning at the point of intersection between different actors’ life-

worlds, and without analysing the social interactions involved, we will have
missed the significance of knowledge itself. Our guiding notions, I suggest, must
be dissonance not consonance, discontinuity not linkage, and transformation not
transfer of meaning. Knowledge is also multi-layered (there always exists a multi-
plicity of possible frames of meaning) and fragmentary and diffuse rather than
unitary and systematized. Not only is it unlikely, therefore, that different parties
(such as farmers, extensionists and researchers) would share the same priorities
and parameters of knowledge, but one would also expect ‘epistemic communi-
ties’ (i.e. those that share roughly the same sources and modes of knowledge) to
be differentiated internally in terms of knowledge repertoires and application.
Therefore engineering the creation of the conditions under which a single
knowledge system (involving mutually beneficial exchanges and flows of infor-
mation between the different actors) could emerge seems unattainable; and, if
indeed one did succeed, this would be at the expense of innovativeness and
adaptability to change, both of which depend upon the diversity and fluidity of
knowledge rather than on integration and systematization.
Discontinuities and accommodations at knowledge

interfaces
In order to explore these issues in more depth it is necessary to develop an
analysis of interface situations. I define a social interface as a critical point of
intersection between different social systems, fields or levels of social order where
structural discontinuities, based upon differences of normative value and social
interest, are most likely to be found. A similar idea is conveyed by Rörling (1988)
when he suggests that interface is not simply a linkage mechanism but rather the
‘force field’ between two organizations. Interface studies are essentially
concerned with the analysis of the discontinuities in social life. Such discontinuities
are characterized by discrepancies in values, interests, knowledge and power.
Interfaces typically occur at points where different, and often conflicting, life-
worlds or social fields intersect. More concretely, they characterize social
situations (what Giddens calls ‘locales’) wherein the interactions between actors
become oriented around the problem of devising ways of bridging, accommo-
dating to, or struggling against each other’s different social and cognitive worlds.
Interface analysis aims to elucidate the types of social discontinuities present in
such situations and to characterize the different kinds of organizational and
cultural forms that reproduce or transform them. Although the word ‘interface’
tends to convey the image of some kind of two-sided articulation or confronta-
tion, interface situations are much more complex and multiple in nature.
In order to accomplish this, it becomes essential for actors to win the struggles
that take place over the attribution of specific social meanings to particular
events, actions and ideas. Looked at from this point of view, particular develop-
ment intervention models (or ideologies) become strategic weapons in the hands
of the agencies charged with promoting them (Long and van der Ploeg 1989).
36 Norman Long
This process is illustrated by van der Ploeg’s (1989) analysis of how small-
scale producers in the Andes succumb to ‘scientific’ definitions of agricultural
development. He shows that, although peasants have devised perfectly good
solutions to their own production problems (here he is concerned with potato
cultivation), their local knowledge gradually becomes marginalized by the type of
scientific knowledge introduced by extensionists. The former, that is, becomes
superfluous to the model of ‘modern’ production methods promoted by ‘the
experts’, and development projects become a kind of commodity monopolized
and sold by experts who exert ‘authority’ over their subjects. In this way the
rules, limits and procedures governing the negotiation between state agents and
farmers and the resources made available are derived (in large part) from
external interests and organizations. Hence, although it is possible to depict the
relations between Andean peasants and outside experts or state officials in terms
of a history of distrust and dependency, science and modern ideologies of devel-
opment eventually come to command such a major influence on the outcomes of
dealings with cultivators that they effectively prevent any exchange of knowledge
and experience. This creates what van der Ploeg calls ‘a sphere of ignorance’
whereby cultivators are labelled ‘invisible men’ in contrast to the ‘experts’ who
are visible and authoritative.
Such processes, however, are by no means mechanical impositions from the
outside. They necessarily entail negotiation over concepts, meanings and projects
that are internalized to varying degrees by the different parties involved. Thus
the ability of extensionists to transform the nature of agricultural practice is
premised on two elements: their skills in handling interface encounters with peas-
ants; and the ways in which the wider set of power relations (or ‘chain of agents’)
feeds into the context, giving legitimacy to their actions and conceptions, and
defining certain critical ‘rules of the game’. Counter-balancing this is the fact
that cultivators, too, assimilate information from each other, as well as from
‘external’ sources, in an attempt to create knowledge that is in tune with the situ-
ations they face.
The final part of this chapter discusses the contradictions that arise over coca
production in Bolivia, where the interests and discourses of development
promoted by government and US aid severely conflict with the livelihoods, social
priorities and development language of local producers.
Illegal crops in an age of global consumption:

counter-development processes3
In Bolivia during the mid-1970s, a huge wave of people migrated to the
Chapare region, following the collapse of the mining industry in which many
thousands had been gainfully employed. This coincided with the increase in
demand for coca leaves essential to the production of cocaine for illegal interna-
tional consumption. It is no exaggeration to say that market-led development
was extremely effective in generating the production of the crop in Bolivia. Coca
leaves have now become the economic icon that links local producers,
entrepreneurs and an ever-increasing market of consumers of illegal substances

in the United States and Europe. It is now estimated that 80 per cent of the total
of Bolivian coca production originates from the Chapare region, of which 90
per cent ends up as raw material for cocaine production (Lohman 1992).
From about 1985 onwards, the region became the target for a massively
funded drug eradication programme aimed at persuading farmers to give up
coca production in favour of what was called ‘alternative development’. In this
way, the Bolivian government, led by US military advisors, intervened in the
region and declared ‘a war against drugs’. With this came militarization, viola-
tion of human rights, and attempts to dictate the form of local development – a
trilogy pitted against local coca farmers, who endeavour to resist this criminaliza-
tion of their crop practices.
A further component of this language of ‘alternative’ development is the way
it represents development primarily in terms of investment by outside private
companies interested in promoting agro-industry based on tropical fruits. Thus
Chapare farmers are relegated to being ‘objects’ of development instead of co-
participants in a process of socio-economic change. In building this
representation, the Bolivian Agency for Alternative Development and USAID
(Rasnake and Painter 1989) have set about ‘cleaning-up and legalizing’ local
markets through destroying illegal crops. They have also marketed the region to
potential investors through the use of promotional films that picture how well
equipped the area is for drinking water, electricity, roads, airports and a strong
local culture that respects private property. It is paradoxical that much of this
infrastructure, as well as the images of progress that it conjures up, is a direct
and indirect outcome of the production of coca for the global drug trade.
Intersecting with this agro-export discourse are other alternatives to coca
production. One advocates the transformation of the whole region into an area
for tropical eco-tourism directed primarily at environmentalists and adventure
tourists from the better-off northern countries. Another is more radical – the
‘zero option’. This proposes that the Bolivian government should buy out all
farmers in the area and turn the region into a national park for conservation
purposes. Again, private investment is envisaged as providing the backbone for
such measures.
Although some of these proposals try to deal with farmers’ activities and
commitments, their general tenor is rhetorical: that is, they represent political-
cum-linguistic attempts to control the escalating influence of coca production,
which remains number one on the Bolivian political agenda (see Leons and
Sanabria 1997). They also make the assumption that Chapare farmers are either
conservative or reactionary, and have no intention of legalizing their agro-
production practices ( Jones 1991). Hence, there is no acknowledgement that
farmers have lived through the high financial and other costs of structural
adjustment policies and have constantly been in search of new, economically
viable crops. Farmers complain that in meetings with development experts offi-
cials outnumber them and local initiatives are always ignored. In one instance,
this led to a group of farmers compiling their own database on the economic
38 Norman Long
returns of alternative systems of production so that they might weigh up their

own options. They simply did not trust the way these were being presented in the
official language of development (Schoute 1994: 94).
Coca farmers reject the assumption that in itself eradication can contribute to
local development; and they do not perceive themselves as accountable to, or
dependent on, the drug barons of the cocaine industry. Instead they define
themselves as the ‘innocent’ party, and see the narcotic problem as the responsi-
bility of Western society and culture, and the result of the persisting global
market for drugs. Thus, in local discourse, coca production is not synonymous
with drug trafficking. Coca is a valuable commodity that allows them to sustain a
diversified cropping system that also includes manioc, maize, fruits and animals.
Although non-coca farming occupies a large amount of land and labour, it is the
coca crop that provides them with the necessary income to meet their consump-
tion requirements and to build up capital within the household.
These social and political contradictions in the Chapare region provide a
somewhat different picture of the language and practices of development than
the conventional model. Local farmers here have achieved a degree of economic
progress and political voice through the production of an illegal crop, and in so
doing have reshaped the ways in which the people of Chapare relate to global
markets and the nation-state. Their views are also heard beyond the IMF, just as
the Zapatistas of Chiapas, Mexico, and their voice clearly expresses a counter-
development discourse. In their language and representations, the people of
Chapare are negotiating their participation in the nation-state as citizens, as well
as positioning themselves within global drug networks. This has been accom-
plished through the technological modernization of farming practices (of an
illegal crop) coupled with new ways of using existing political and cultural
discourses. From an orthodox development perspective, this situation is problem-
atic, since the practices of local farmers have ‘de-centred’ the legitimacy and
legality of the Western institutional language of development. In its place, they
have constructed a discourse that combines the use of traditional ‘idioms’ with
the ‘need’ to exploit the opportunities that are offered by the global market.
Thus, local farmers seek political recognition and respect for their local transla-
tions of the signs and codes emanating from the global, neoliberal language of
development.
In April 2001, the government of Bolivia and coca growers – after months of
struggle – reached an agreement ending three weeks of protests that blocked the
major highways and threatened the government’s stability. The coca growers
won concessions to improve working conditions and loan terms for small
producers, peasant farmers and teachers (New York Times 2001). And by mid-
2002, they were involved in supporting the leader of the cocalero campaign in a
narrowly defeated bid for the Bolivian presidency.
This Bolivian case, then, highlights the need to explore the diverse discursive
manifestations of modernity and how these legitimize various linkages that
connect local knowledge, technology, nature, markets, violence, authority and
power with newly emerging global modernities.
Conclusion
This chapter has explored the origins, powers and interests associated with
specific policy ideas. The argument was developed in relation to two intercon-
nected issues. The first concerned how ideas within the field of development
policy and practice are given shape over time; and the second, with how the soci-
ology of knowledge itself has struggled to come to grips with the complexities
involved in these processes.
I started the discussion by indicating how the policy ideas and development
discourses of multilateral organizations are shaped by those who have direct
access to the policy arena – e.g. development policy practitioners, academics,
national governments and multilateral administrative personnel. Yet it soon
emerged that a much wider range of actors was implicated. These included a
rapidly expanding body of ‘lay’ persons and civic organizations hell-bent on
contesting the specific policy measures and decision making constituencies of
multilateral organizations, as well as those locally ‘targeted’ or affected actors at
the implementation end of the process. This was a theme that would reappear at
central points in the argument. Indeed, I argued that the understanding of
knowledge processes in general, as well as those associated with the generation of
particular ideas and frameworks of thinking/acting, rested upon a close-up
analysis of the dynamics of ‘knowledge interfaces’ made up of a multiplicity of
actors and divergent (and often conflicting) interests, values and meanings. I also
pointed to the usefulness of discourse analysis for highlighting the nature and
significance of ongoing struggles between ‘mainstream’ development discourses
and various forms of ‘counter-development’.
These concerns led me in the last part of the chapter to provide an account of
what, for many, may be regarded as an extremely atypical and ugly example of
the kind of development promoted by Western aid donors and multilateral orga-
nizations. Yet, from another angle, the Chapare coca/cocaine production region
of Bolivia may be considered as one of the most successful applications of the
neoliberal idea of market-led development. By growing and processing this crop,
the local population has found a way of generating enough income for its present
and future needs, as well as for investing in local infrastructure and services. But,
alas, this crop is earmarked as ‘illegal’ and so must be eliminated and substituted
by ‘alternative’ forms of production that, actually, bring far fewer benefits. Also
paradoxically, the combined efforts of the ‘war on drugs’ mounted by a Bolivian
military force backed by US ‘advisors’, and the development aid package supplied
by several international and multilateral organizations, has galvanized and
disseminated ‘counter-development’ discourse and measures. Thus it has
contributed to a countrywide movement against the Bolivian government aimed
at extracting a number of critical social policy concessions. This process has now
reached a peak, and we must wait and see how the government and its multilat-
eral partners will attempt to resolve these issues. And we will have to see to what
extent significant and longer-term changes take place in the thinking and practice
of those multilaterals involved. Either way, the case clearly illustrates how
40 Norman Long
discontinuities of interests, values and knowledge play a role in challenging

existing power relations and generating new modes of political agency.
This chapter has also highlighted four further crucial points for analysing
policy ideas:
1 the need to differentiate the process in terms of the types of struggle that
take place in different arenas and at different levels of the political process;
2 the importance of the existence of multiple, but overlapping, discourses on
development;
3 the significance of the interplay of ‘expert’ and ‘lay’ knowledge and the
social relations that underpin them; and
4 the necessity of grounding understanding in terms of situated social prac-
tices rather than ideal-typical representations.
Notes
1 Building upon Foucault’s perspective on discourse and knowledge/power, several
works have explored the hegemonic nature of narratives, images and discourses of
development organizations and ideologies. See for example Ferguson (1990), Hobart
(1993b) and Escobar (1995b).
2 In a recent lecture presented at the Congreso Internacional de Latinoamericanistas
en Europe (CEISAL) in Amsterdam, Escobar argues for the central importance of
the notion of ‘counter-development’ for understanding multiple modernities. He
draws upon Arce and Long (2000).
3 This section is derived from Chapters 2 and 10 in Arce and Long (2000).
4 The informal sector
Biography of an idea
Desmond McNeill
Year after year the Annual Report of the Uganda Protectorate has referred,
under the heading of industry, to a few large undertakings directly sponsored by
the Government. At the same time the multifarious development of furniture
workshops, soap mills, tire retreading plants, bakeries and brickfields has gone on
largely unnoticed. An official who was once asked about Kampala’s industrial
area said: ‘There are no industries there – only a lot of furniture works, bakeries, maize mills
and soda water factories.’
(Elkan 1959, quoted in Livingstone 1974, italics by author)
Introduction
The term ‘informal sector’ entered the development vocabulary almost thirty
years ago, to refer to the numerous and variegated activities engaged in by people
in poor countries which fell outside the official categories of what counted as
employment. The idea has had a long and productive life, leading to a much
richer understanding of the daily productive lives of a substantial proportion of
the world’s urban population, and significantly modifying attitudes and policies
towards them. In the early 1970s, the context, in terms of development research
and policy, was a concern with the relationship between poverty and employment.
The conceptual difficulty of understanding poverty – and especially urban poverty
– in terms of existing categories and theories (modernization/dualism) was here
closely related to the policy challenge of reducing poverty.
In this chapter I present a critical biography of this idea, which I hope will
serve a more significant purpose than the mere chronicling of an important
concept. For not only is the idea interesting in itself, but I suggest there are paral-
lels between the fate of this and other more recent ideas which have influenced
development policy – such as governance, or social capital – which are still in
their infancy. By studying this particular one, in a structured and critical manner,
we may learn something about others, and how best to deal with them.
Furthermore, the history of this one idea gives us an insight into the history of
development research and policy over this period, which may cast light on recent
conceptual developments. The chapter falls into three sections: first, a brief
‘biography’ divided into historical periods; second, the presentation of a simple
42 Desmond McNeill
analytical schema; third, some brief reflections on trends in development

research and policy which have both influenced, and been influenced by, the
concept of the informal sector.
A great deal has already been written about the term ‘the informal sector’,
and at least two annotated bibliographies have been prepared (Danesh 1991;
Feldmann and Ferretti 1998). On the basis of these materials, supplemented by
interviews with a few of the key actors, and my own experience in the early
years, I have prepared the following ‘biography’.
Biography
Creation, 1972–74
The term itself was coined at a conference on Urban Unemployment in Africa,
held at the Institute of Development Studies (IDS), University of Sussex, 12–16
September 1971, at which Keith Hart, an anthropologist, delivered a paper enti-
tled Informal Income Opportunities and Urban Employment in Ghana.1 The
concept fitted within an important contemporary debate on employment and
growth and met a very specific need among some economists at IDS who were
then involved in a collaborative series of studies with the International Labour
Organization (ILO) under their World Employment Programme.
In the 1950s and 1960s the ‘accelerated growth’ model dominated development
planning: industrial expansion would result in increased wage-sector employment,
and the benefits would trickle down throughout society. In the process of modern-
ization migrant workers from rural areas would gradually become absorbed into
the city. But by the beginning of the 1970s it was apparent that the theory did not
match the reality, for rapid economic growth had been of little or no benefit to
perhaps a third of the population of underdeveloped countries. ‘Although the
average per capita income of the Third World has increased by 50% since 1960,
this growth has been very unequally distributed among countries, regions within
countries and socio-economic groups’ (Chenery et al. 1974: xiii).
This quote is from the influential Redistribution with Growth, a joint study by the
World Bank’s Research Center and the Institute of Development Studies at the
University of Sussex. These two, together with the International Labour
Organization (ILO), through the World Employment Programme, played a
central role in the creation and adoption of the informal sector idea. Applied
researchers (who were mainly economists) here worked in collaboration with
research-minded aid bureaucrats (also mainly economists). In the formulation of
what came to be known as the IBRD/IDS Redistribution with Growth model, the
earlier country missions in Colombia (1970), Sri Lanka (1971) and Kenya (1972),
all headed by IDS personnel, was very influential.2
It was in the Kenya Report of the ILO that Keith Hart’s term ‘informal
sector’ was first officially used. The term replaced others, of which the most
current seems to have been the ‘working poor’. A few of the people on the (very
large) visiting team undertaking the Kenya study made a visit to a poor neigh-
The informal sector: biography of an idea 43
bourhood of Nairobi. Here, with an American anthropologist as guide, they

observed the large numbers of people and variegated types of activity which
came to be called the ‘informal sector’. Until then the focus of this and similar
studies had been on what later became known as ‘formal’ employment, ignoring
the activities of a large proportion of the working population.
The ILO played a particularly active role in this period in stimulating interna-
tional debate on issues of poverty and employment. Their Employment Policy
Convention, no. 122, 1964, had committed governments to adopt ‘active full
employment policies’, and in 1969 the director-general of ILO launched the
ILO World Employment Programme.3 This set out to analyse employment
problems and devise strategies, and to this end a series of country studies was
undertaken, each with its own terms of reference, but within an overall brief to
evolve employment-orientated strategies of development. Despite their limita-
tions, these ILO country missions played a crucial role in the development of a
new approach to the employment problem, with wide-ranging implications and
repercussions for future research.
The ILO World Employment Programme also conducted a series of city
studies, complementing the country studies, to identify the causes and extent of
urban poverty. These studies contained recommended measures for increasing
employment in major urban areas.
In the years that followed, there continued to be major disagreements in rela-
tion to both analysis and prescription (and indeed definition), which will be
elaborated upon later in this chapter. The term itself – the ‘informal sector’ – was
at the centre of this sometimes heated debate, but the very fact that the term was
shared by all those concerned is evidence of the significant role that it played.
Adoption and proliferation, 1975–80

The late 1970s can, I suggest, be described as a period of adoption and prolifer-
ation of the idea, as a basis for both theoretical debate and policy formulation.4
And these two arenas – of research and policy – interacted, with some people
playing an active role in both. The ILO sponsored, or was in some way involved
in, a long series of studies which are well summarized by Harold Lubell, one of
the central actors, in his comprehensive review:
Chapters on the informal sector were included in several of the urbaniza-

tion and employment city monographs … and a dozen special case studies
were carried out in Africa, Asia and Latin America using, as a common
element, a questionnaire designed by S.V. Sethuraman.
(Lubell 1991: 22)
From 1974 to 1977, the ILO Urbanization and Employment Research Project
undertook studies in Africa (five); in Asia (three); and in Latin America (three). In
addition, Lubell refers to many other studies undertaken in Africa, Asian and
Latin America extending over a longer period. Lubell makes some revealing
44 Desmond McNeill
comments on these surveys, referring not only to ‘a variety of types of informal

sector behaviour’ but also ‘a variety of perceptions of it by academic and other
researchers’.
Most of the field surveys have been carried out in Africa whereas most of
the theorising has been done in Latin America. The approach in Africa has
been largely pragmatic. The casual empiricism of the ILO Kenya
Employment Mission has been reinforced and amplified by the considerable
number of systematic field surveys cited above.
(Lubell 1991: 64)
The point Lubell makes here about field surveys in Africa and theory in Latin
America hints at a tension between the two to which I shall return below. He
comments also on the ‘remarkable resemblance’ between informal sector activi-
ties across very different countries and continents, which also raises rather basic
methodological questions. Does this similarity in findings arise because the
concept is so loosely defined? (see below). On the basis of this overview, Lubell
summarizes five similarities, including:
• informal sector activities absorb between 40 and 60 per cent of the urban
labour force of many of the Third World cities studied;
• informal sector enterprise heads often earn more than the official minimum
wage or the average wage in the formal sector; employees usually earn less
than the official minimum wage;
• backward linkages to formal sector suppliers of inputs are strong; forward
linkages are generally limited to households and other informal sector
producers.
The second point dispels the common a priori assumption that ‘informal’ neces-
sarily implies poor. It is also apparent that linkages with the formal sector are
complex and varied. This issue was central in theoretical debate at this time,
between what may be termed the reformists and the Marxists, a debate which
drew partly on a priori and partly on empirical findings. In brief, were these links
mutually beneficial or exploitative?
Lubell draws another contrast: between radical and critical researchers from
academia, and more conventional and constructive researchers associated with
aid agencies:
Most of the studies sponsored by the international and bilateral aid agencies
have focused on the potentially viable micro-enterprises that constitute
George Nihan’s ‘modern informal sector’. Some of the university-generated
studies, particularly those by the radical economists, have on occasion been
more concerned with the ostensibly marginal activities such as garbage
reprocessing and lottery ticket selling.
(Lubell 1991: 64)
In parallel with these studies, and the policy debate associated with them, there
was a lively debate also in academic circles, manifested in an increasing number
of articles, and later books and doctoral theses. The former appeared both in
multidisciplinary journals of development studies (such as World Development, e.g.
Special Issue 1978), and development planning (such as Regional Development
Dialogue), and also (though generally later) in mono-disciplinary journals, such as
Urban Anthropology and the Cambridge Journal of Economics.
But the debate concerning the informal sector led also, from the mid-1970s,
to both critique and resistance, primarily from two contrasting perspectives (this
in addition to continuing debate concerning definitions – see below). First,
among researchers, there was a radical political economy approach.
Summarized as ‘informal sector or petty commodity production?’ this centred on
the question of whether the relations between the formal and informal sector
were exploitative or not.5 A second, and very different critique, came from some
policy makers in developing countries who were resistant to the implications of
the debate, especially insofar as it was linked to the broader ‘basic needs’
approach.6
Although both the concept of basic needs and the informal sector were asso-
ciated with the World Employment Programme (WEP) of ILO, the former was
much more controversial. An interesting insight into this conflict may be gained
from reading the account of Walter Galenson, who worked at the ILO and was
critical both of the research undertaken, and of Louis Emmerij, Director of the
ILO employment programme.
He is especially critical of the WEP conference in 1976. ‘The US government
representative objected to the implication that the conference … was committing
the ILO to support the New International Economic Order’ (Galenson 1981:
181). ‘A draft document designed to serve as the basis for discussion at the
Conference was drawn up by the Office. … A subtle shift of emphasis away
from employment and towards the fulfilment of unspecified basic needs was
(also) noted’ (ibid.). US officials had a meeting at the Department of Labour to
discuss the draft. ‘The meeting was a heated affair, with the US participants
denouncing the draft on many counts’. The last of the eight objections was:
‘There was Marxist language in the draft that had no place in such a document’
(ibid.: 182).
According to Galenson, the US view was in a minority at the 1976 confer-
ence, but a conference of foreign ministers in 1978 concluded that
a basic needs approach at an international level would inevitably imply the

imposition of global priorities on developing countries, thereby not only
distorting the allocation of domestic resources of the latter but also perpe-
trating [sic] their technological dependence on the developed countries.
(ibid.: 189)
A more measured assessment of the conference is to be found in Emmerij and

Ghai (1976: 202).
46 Desmond McNeill
But the concept of the informal sector was less controversial than basic needs,
and it continued to have a significant and increasing impact on urban policy and
programmes in developing countries in this period. Here, it is worth referring
especially to the experience of the World Bank. In September 1973, the
President of the World Bank, Robert McNamara, made a famous speech in
Nairobi which signalled a major assault on poverty. But the emphasis was almost
totally on rural poverty. Some in the World Bank were concerned that a major
proportion of the world’s poor lived in cities, like Calcutta, which were in danger
of being forgotten. An Urban Poverty Task Force was established in 1974 to
respond to this challenge, and a new Urban Development Division was set up.
Missions were sent to a number of Third World cities to define urban projects to
be funded by the World Bank, the first being in Dakar, Senegal. The main focus
was on housing and infrastructure. The standard approach was to promote ‘site-
and-service housing’, and later also ‘slum and shanty upgrading’. Here they were
much influenced by the ideas of the architect John Turner and others.
Although the concept of the informal sector was referred to in this work,
employment was not a significant focus – at least in the early urban missions. An
influential working paper – ‘The Task Ahead for the Cities of the Developing
Countries’ – was published in 1975, and took up the issue of the urban labour
market. It described the dualistic distinction between ‘formal’ and ‘informal’
sectors as simplistic (Beier et al. 1975: 51, 52). In this year also McNamara
committed the Bank to an increased emphasis on urban development. The Bank
was at this time collaborating closely with ILO, as noted above, and supported
major efforts on urban research and policy, but it was only in the late 1970s that
the Urban Division of the Bank incorporated its ideas on employment into
urban programmes. On this topic, there was overlap with the responsibilities of
the Industry Department. It is notable that the policies of this department
towards small and medium enterprises (SMEs) changed substantially at this time,
culminating in February 1978 with the publication of a policy paper entitled
‘Employment and Development of Small Enterprises’. ‘Following the new initia-
tive, from July 1977 through June 1984, the World Bank lent US$1.97 billion in
63 projects to support SMEs’ (Lewitsky 1985). It may be significant to add,
however, that in the review by the Industry Department from which this quota-
tion is taken, the term ‘informal sector’ is never used. It was used in the Bank for
describing, and to some extent also analysing the urban economy, and thus had
some influence on the choice and design of projects, but its impact was limited.
Mainstreaming, 1980s
In the 1980s the concept was very widely used, and by the end of the decade it is
safe to say that the term ‘informal sector’ was fully within the mainstream in the
worlds of academia and policy, appearing both in textbooks of development
studies7 and the plans of national and international agencies.
Within academia one can trace the debate, beyond development studies into
different disciplines. The multidisciplinary journal World Development played a key
role in this debate, as in many others. The IDS Bulletin also published extensively
on the topic – understandably in view of the major role played by this institute.
These were especially important in the early years, but others which were less
policy-oriented also took up the term: such as the Journal of Development Studies,
the Journal of Modern African Studies and Economic Development and Cultural Change.
Interest in this field generated further empirical data, and analytical and
conceptual work, with a number of doctoral theses on the subject. The first
doctoral dissertation concerning the informal sector (i.e. using the term) was
completed in 1979. Thereafter, the number remained rather steady year by year.
From 1979 to 1989, twenty-five such theses were written. In the 1990s, the figure
was rather higher, thirty-nine. The peak period was 1994–97 (Data from Library
of Congress, Washington).8
But strains were beginning to show. One source of tension was between
different disciplines, with economists tending to use the term almost as synony-
mous with small-scale enterprises (Schmitz 1982), and even casting doubt on
whether the concept had anything new to add to the understanding of employ-
ment (see for example Stark 1982). During this decade the term began
increasingly to be used not only in interdisciplinary or policy-related journals,
but also in mono-disciplinary journals. Researchers from several different disci-
plines used the term, ranging from sociologists and anthropologists (e.g. Moser,
Rakowski) to economists (e.g. Adachi, Chandra and Khan, Gupta, Gibson and
Kelley).9 Another tension that was inherent from the start – between the
reformist and radical approaches – continued. This was linked both to the theo-
retical analysis of the informal sector and to the policy implications.
In the policy arena, the term was widely used not only by the World Bank, as
already noted, but also by other international agencies (e.g. UNCHS [United
Nations Centre for Urban Settlements]), regional development banks (e.g. ADB),
bilateral agencies (e.g. USAID and ODA) as well as national agencies (e.g.
HUDCO [Housing and Urban Development Corporation], India).10 It is
certainly fair to claim that the concept helped to shape the urban agenda, and to
ensure that the urban poor were not forgotten. Although it is not easy to demon-
strate concretely how it influenced urban development policy, and the choice and
design of projects, it is the case that the urban projects of the World Bank in the
1970s and 1980s were evaluated positively in terms of their overall performance,
and were relatively successful in benefiting the poor, even though here, as so
often, it proved difficult to reach the very poorest income groups.
Distortion/destruction, 1990s
In the 1990s, one might argue, the informal sector ‘idea’ became severely
distorted, or even destroyed. Certainly it suffered the fate of many attractive
ideas by being over–extended. This began to happen already in the 1980s, with
the term ‘informal’ being applied to housing, transport, and later finance.
Another and more interesting development, was that the term was increasingly
applied to cities in developed countries. This actually began earlier, and was
48 Desmond McNeill
initially applied mainly to studies of immigrant workers (e.g. in New York,

Miami). But it was also extended to others (e.g. Italy, Spain, UK, Netherlands,
Russia). There is now an extensive literature on this topic. The major bibliog-
raphy (Feldmann and Ferretti 1998) contains far more references to studies of the
USA – 118 – than the next largest, India, which in turn is followed by Britain.
But I would hesitate to characterize this extension of the concept as a distor-
tion. Indeed, I would argue to the contrary that the split between developing and
developed country discourses is unnecessarily wide, and that ideas can (indeed
should) move in both directions. The use of the term ‘informal sector’ in devel-
oped countries is indicative, I suggest, not of a distortion of the term, but of
significant changes in developed countries which make them more like devel-
oping ones: a shift in the nature of employment towards what is often called
‘flexible labour,’ which many see as regressive.
The adoption of the term in developed countries I therefore see as a legiti-
mate extension. More controversial is the rebirth of the term in the writing of
Hernando de Soto:
The most significant recent change in emphasis has been the shift from the
micro-enterprise as such to the regulatory framework that encourages
informal micro-enterprises to stay small. Avoidance of government regula-
tions and taxes was one of the characteristics of informality originally
specified in the definition formulated by the ILO Kenya Employment
Mission Report of 1972, but informality has taken on a new dimension
since the publication of Hernando de Soto’s The Other Path in 1986. The
new wave of research on the informal sector may be described as an exami-
nation of the compatibility between regulations and growth of small and
micro-scale enterprise activity, with a view to reforming the regulatory
framework.
(Lubell 1991: 64–65)
Lubell’s presentation of the renaissance of the informal sector is neutral, but

others see this as a clear distortion; its rebirth in a form which reflects what is
seen as the neoliberal ideology of de Soto, and the Institute for Freedom and
Democracy in Lima, Peru, which he established.
Finally, one might claim, on the basis of a very different – and rather formal-
istic – argument, that the informal sector idea is not simply distorted, but actually
dead. It was born, as I have shown, out of an anomalous situation: the lack of fit
between the categories of the ‘developed countries’ (as embodied most starkly in
official statistics) and the ‘reality’ in developing countries. This led to a great deal
of research, both empirical and conceptual, on the informal sector. But the statis-
ticians were not entirely unmoved by this revolution, and during the late 1980s
the ILO Bureau of Statistics launched a series of activities that culminated in the
adoption of a resolution concerning statistics of employment in the informal
sector by the Fifteenth International Conference of Labour Statisticians in 1993.
What had previously escaped classification was now officially included.
Thus the development of the term finally turned full circle – in the formalistic
sense of being defined out of existence. Central to the idea of the informal
sector – at least initially, but also, I would argue, subsequently – is that it refers to
activities that fall outside the scope of official statistics. Thus, to agree an interna-
tionally applicable definition of the informal sector is to make it disappear. It is
government statisticians (and accountants) who are the ultimate arbiters of
reality in the modern world. By finally granting official recognition to the
informal sector they also issued its death certificate.
Whether this is the final word or whether further developments occur remains
to be seen, but this completes my brief biography of the idea to date. In the
remainder of this chapter I shall explore some aspects of it in more depth, and
also reflect on what one may learn more generally from this analysis.
Analysis
A simple conceptual model

In this section I wish to suggest some hypotheses concerning the role of ideas in
development assistance that may be of more general application, based on a
simple schema in the form of a two-by-two matrix, distinguishing between the
arenas of research and policy, and between the international (global) and the
local. The development of ‘the informal sector’, and other ideas, can be traced
in such a schema, to provide a sort of ‘historical geography’ of the spread of the
idea. Thus the history related in the previous section could be crudely summa-
rized as a flow through the matrix: how the idea started at the interface between
policy and research, in the ‘global’ arena; then moved both into the policy arena
(global and local) and into the academic arena (from development studies to
mono-disciplines); and how – to a limited extent – there was feedback both from
the academic world and from the ‘field’. What is particularly revealing, also for
comparative analysis of other ideas, are the interfaces between the four quad-
rants of the matrix, and I will briefly refer to each in turn.
The link between (international) research and policy

There is a close link between research and policy at the international scale. In
the case of the informal sector a small group of people, working in key northern
institutions at the interface between research and policy, played a crucial role –
as noted above. Since then the number of people and institutions involved in
development assistance has increased considerably, but some of the same
patterns may be apparent. For the persons concerned there are shared benefits,
but also, perhaps, costs. Both academics and bureaucrats are confronted with
interesting challenges, but may as a result face problems vis-à-vis their respective
peer groups. The writings of the academics involved may not measure up to the
expectations of the research community, while those bureaucrats who become
involved in conceptual and theoretical work may be criticized as impractical and
50 Desmond McNeill
irrelevant by their colleagues. It is worth again noting here the ideological

dimension, which is relevant both in the arena of theory and policy, and which
compounds the complexity surrounding a concept such as the informal sector.
As already noted, there are major differences of viewpoint, both within
academia and policy making, regarding the relationship between the formal and
informal sectors, and the appropriate policy measures. It is, in principle, the
intention of both researchers and policy makers to use neutral terms; with the
‘informal sector’ being just one example. In practice it is difficult, and by acci-
dent or design such terms are ‘loaded’.
The link between international and national policies

When it comes to the link, or lack of it, between international and national poli-
cies, there is considerable variation by country and region. Two factors, which are
closely related, are of determinate importance: both of which may be captured by
the term ‘ autonomy’. First, to what extent does the country or region concerned
have a stock of able and experienced bureaucrats? Second, to what extent is it
reliant on grants and loans from the development assistance community? At one
extreme are economically powerful countries such as Brazil and Malaysia that can
both afford to resist the imposition of policies they disagree with, and have the
competence to devise their own autonomous ideas and policies. At the other
extreme, there are countries such as Tanzania and Nepal, which are in a much
weaker position. In such countries the link between international and national poli-
cies may appear to be strong, but the policies may exist only on paper. It is beyond
the scope of this exercise to assess whether and to what extent stated policies are
actually carried out on the ground. In broad terms one might assert that while the
link between international and national policies tends to be stronger in the case of
less powerful nations, the link between national policies and national practice is
weaker. But in the case of very heavily aid-dependent nations, national practice (as
well as official policies) may be largely determined by donor agencies.
The link between international and national research

The relationship here is generally unequal. There is a clear hierarchy, with very
few South countries (for example India, and some in Latin America) having
high-status research institutes. Many individual researchers from the South, of
course, enjoy high status, but they often move to the North, or at least associate
themselves with academic institutions in the North for undertaking research
studies. It is relevant in this context to refer to the studies undertaken by ILO
and others, in Africa, Asia, and Latin America in the 1970s and 1980s. There is
a significant variation in the extent to which the policy-related research studies
were initiated and undertaken by the national government or by outside bodies;
and to what extent local or foreign researchers were used for the work. It appears
that Latin America and some Asian countries were far more ‘autonomous’ than
the others.11
In the case of the informal sector idea, and, some would argue, in develop-
ment research more generally, there is evidence also of an imbalance within the
North: a dominance of the Anglo-Saxon world (perhaps even more narrowly
focused on East Coast USA and England).
The (lack of a) link between national research and policy

The weakest link of all is often between national research and national policy,
especially when aid dependence is high. The research world is relatively weak in
many developing countries; and this may even be exacerbated by development
assistance. At the risk of over-generalization, one may suggest that the link is
weakest in most countries in Africa, very variable in Asia, and strongest in Latin
America. The last of these is especially interesting, for this region, especially
through the work of the Economic Commission for Latin America, played a
major role in presenting an alternative paradigm in the 1970s.
In addition to studying the interfaces between the four quadrants of the
matrix, it is also worth adding some brief comments on what goes on within the
top and bottom halves of the matrix. First, the relationship between policy and
practice in multilateral institutions and national agencies: in multilateral devel-
opment agencies it is not uncommon to encounter an uneasy relationship
between the research division and the operational divisions, and a gap between
policy and practice.12 Second, the relationship between disciplines: there is, as
already noted, a tension within development studies between economics and
other social sciences (Meier 1993). This manifests itself most strongly within
academic institutions (especially universities), but also occurs within interna-
tional agencies.
Policy consensus and definitional discord

The power of the informal sector ‘idea’ is, I suggest, that it may be capable of
acting as a bridge, in several respects: a bridge between research and policy,
between different disciplines, and – perhaps most important – between appar-
ently conflicting positions (see also Chapter 8 on social capital). It holds out the
prospect of a consensus; something which is crucially important for policy
makers, though not necessarily for researchers. The danger is that such
consensus is often gained at the expense of rigour.
Development institutions, such as the World Bank or the UNDP, are staffed
by individuals who are subject to pressures which necessarily influence their
behaviour. First, there is a desire to appear smart, or at least not to look foolish –
in the eyes of the world – and especially those defined as peers. This pressure
operates both at an individual level, and at the level of the agency, and ‘relevant
others’ may be those in other agencies, the research community, NGOs, the
media. This may foster originality, both because this is how one marks oneself
out, and because new ideas may be better than the old ones they replace; but it
also encourages caution.
52 Desmond McNeill
Second, there is a desire not to criticize or confuse unnecessarily. In order to

establish the validity and importance of a new idea, it would a priori seem to be
necessary to point out the faults in those that are current, and thereby also criti-
cize current policies – of one’s own or other agencies. But this is an unwelcome
activity in a bureaucracy.
Third, there is a desire for a common policy among donors, and between
donors and recipient countries. There are very good arguments for donor co
ordination regarding policies, and no doubt that policies which are fully
endorsed by recipient countries are far more likely to be successful.
On balance, these forces create pressure for consensus, but at the risk that
agreement is reached only by avoiding or concealing real differences of view.
Prolonged discussions at international conferences end all too often with a
compromise that is empty in analytical and policy terms. But in the case of the
informal sector – and I suggest this is one reason that this concept was successful
– it helped to create what I call substantive consensus.
A consensus is, ideally, achieved both in analytical terms (i.e. what the informal
sector is) and in policy terms (what needs to be done). Certainly this consensus
became strained, in the case of the informal sector, and the concept distorted. The
focus of much of this discord was, of course, the definition of the term itself. What
is an appropriate definition of the term, and who should decide? Here, the tension
between researchers and policy makers is very marked: the latter need not just
simple definitions, but also ones which enable action to be taken.13 For a glimpse of
some of these debates, see for example Khundker (1988) and Chandavarkar
(1988).14 I will not explore the details here, but simply make three comments. First,
the question of definition was central in the discussion between radicals and
reformists: whether the relation between formal and informal sectors is benign or
malign – an issue which is necessarily very difficult to test empirically. Second, defi-
nitions varied between different disciplines: whether employment-focused or
household/livelihood focused; whether generalizable or context-specific. Third,
policy makers tended to be far less concerned with the niceties of definition than
researchers. The lack of a clear definition opens the way both for poor quality
research, and also for a policy consensus which is more apparent than real.
Relating to the wider debate

The idea of the informal sector had a significant impact on both development
research and development policy – at least in the urban sector – over a ten and
perhaps even twenty-year period. It was also, of course, itself shaped by all the
other ideas and practice. We may learn a little more about both by reflecting on
the changes over this period and how the informal sector related to them. To
assist in the daunting task of summarizing development thinking over this
period, I will draw on an excellent recent review by Lance Taylor in
‘Development with a Human Face’ (see Taylor et al. 1997).
In the 1950s and 1960s there was an important theoretical and empirical
debate concerning the hypothesis that there was a necessary tradeoff between
equity and growth (Kuznets 1955; Kaldor 1957), which was challenged empiri-
cally (e.g. Adelman and Morris 1973). The important policy prescription that
resulted from all this information was that ‘average per capita income growth
cannot be assumed to alleviate inequality and income-poverty automatically’
(Taylor et al. 1997).
The early 1970s was a period of rather radical theory (dependency theory,
unequal exchange, etc.) and radical expectations for change (the New
International Economic Order) (see for example Hettne 1995 for an overview).
In this context the informal sector appeared middle-of-the-road, reformist, and
was described as such – at least by its critics. This applied both to the analysis,
where the reformist concept of the informal sector was counterposed to the
more radical ‘petty commodity production’, and also to the policy prescriptions,
which consisted of projects and programmes as opposed to radical changes of
policy. This applies with even more force to the fate of ‘basic needs’, with which
the informal sector is linked.
In the late 1970s came reversal, and a downturn in many Third World
economies. The reasons for this downturn are complex (see Hobsbawm 1995)
but Taylor et al. believe that it explains why Chenery et al.’s Redistribution with
Growth (1974) not have the policy impact it could have had because the oil shock,
the ensuing international recession, and later the debt crisis soon reoriented the
priorities of countries and multilateral agencies’ (Taylor et al. 1997: 438). As they
note, this was the time at which McNamara at the World Bank announced an
all-out attack on poverty.
The post-war golden age came to a close, and one consequence was a ques-
tioning of the role of the state and import-substitution industrialization policies.
In the development literature, early examples are Little et al (1970) and

Bhagwati (1971), while supply-side economics was a kindred trend in the
industrialised world. … Since the early 1980s more and more countries have
adopted market-friendly policies in the aftermath of the debt crisis. … With
the first structural adjustment loans from around 1980, market-based
reforms became tied to adjustment lending.
(Taylor et al. 1997: 438)
During the second half of the 1980s, however, the positive impact of social
services (especially education) on growth was emphasized by a number of
neoclassical economists, and the human capital model was used in the new
Growth Theory. The 1980s was a period of recession, neoliberal ideas, and
neoliberal policies – most notably structural adjustment. Here the informal
sector did not feature prominently, until taken up again in a different guise (as
noted above).
In summary, the ‘idea’ of the informal sector was certainly much influenced
by the contemporary debates, and itself made a modest contribution to both
theory and policy. During the 1970s it appeared reformist – as did the publica-
tion that put it on the map: Redistribution with Growth. Marxists asserted that the
54 Desmond McNeill
informal sector was exploited by the formal sector; and policies to promote it
were seen as ignoring fundamental structural inequalities. By contrast, in the
1980s and early 1990s, such policies seemed almost radical; granting recognition
and even support to groups who were at best on the margins, and at worst in
conflict with state authorities.
In the new millennium we seem to be witnessing in development policy a sort
of return to the middle ground of social democracy: ‘structural adjustment with
a human face’ (following the efforts of UNICEF and others), ‘participation with
growth’. Certainly there is a return to poverty as the central focus, with civil
society, governance and other catchwords, and the search for a complementary
role of state and market. Whether the informal sector has a place in this debate
remains to be seen. But it has both reflected and to a modest extent shaped the
changes that have occurred – in both analysis and policy terms – in the previous
twenty-five years. And an analysis of its history is, I suggest, revealing for the
prospects of other ideas in development studies.
Notes
1 The paper was not published until 1973 (Hart 1973). As a result, the first and crucial
reference to this paper (in ILO 1972) actually precedes it. This is a good example of a
more general phenomenon which applies to the relation between research and policy:
the time-lag in academic publication is often much longer.
2 Hollis Chenery, Vice-President of Development Policy at the World Bank, was
formerly a Professor of Economics at Harvard and supervised Richard Jolly as a
graduate student. Dudley Seers (Director, IDS) had some ten years earlier been a
visiting professor at Yale, and had close contact with Chenery.
3 According to Emmerij (personal communication), it was very unclear what were the
implications of these grand commitments; but there was enormous interest in the
topic, and funding for the studies that followed was overflowing.
4 Some would argue that the leap from description to policy was too rapid. This is a
common phenomenon in the interplay between research and policy, when the former
is at what Portes might refer to as the ‘pre-theoretical’ stage.
5 For an excellent and concise review of the informal sector in historical perspective,
see Gerry (1987).
6 The concept of the informal sector was, according to Emmerij (personal communica-
tion) not inextricably linked to basic needs. It is interesting that the latter (which
might appear on the face of it to be as uncontroversial as apple pie and motherhood)
should be the focus of such intense strife. But while the informal sector was more
limited in scope and (relatively) more analytical, the term ‘basic needs’ was, in fact,
very closely linked to a wide-ranging development strategy which was controversial.
7 A review of relevant textbooks over the twenty-five-year period reveals that use of the
term began from the end of the 1970s, and continued quite steadily thereafter. But it
is interesting to observe that it was increasingly taken for granted – in the sense that
the definition of the term was not problematized – if it was defined at all; and refer-
ences to Hart and/or ILO became less frequent as time went by.
8 By contrast, theses on social capital first appeared in 1989 and a total of sixty-two
appeared in the following decade, the majority in the years 1996–98.
9 See for example Annals of the American Academy of Political and Social Science 1987.
10 For an overview see Harris (1992), which summarizes the experience of key figures
from most of the agencies concerned.
11 The works referred to here are what might be called ‘first generation’ and more
policy-related studies. A much longer list can be found in two recent bibliographies
(Danesh 1991; Feldman and Ferretti 1998).
12 This is beyond the scope of this study, but the gap is clearly substantial. Examples
from Indonesia and India are cited in Harris 1992. ‘The recurrent gap between
strategy and implementation was also a gap between two sets of people – those
designing policy and those implementing programmes and projects’ (44). The terms
of reference of the Madras Metropolitan Development Authority included ‘to alle-
viate the condition of the poor, pay special attention to the condition of the poor, and
the improvement of the informal sector, etc. Did they do anything about it? Nothing
at all’ (75).
13 I have explored elsewhere (McNeill 2000) the criteria that need to be fulfilled for a
good definition: e.g. value-free, not self-referential. In relation to the informal sector
more specifically, I have argued the case for a ‘polythetic classification’.
14 According to Ahwireng-Obeng (1996), studies in over seventy-five countries have
generated more than fifty definitions.
5 Policy stories and
knowledge-based regimes
The case of international
population policy
Ole Jacob Sending
Introduction
The International Conference on Population and Development (ICPD), held in
Cairo in 1994, produced a new consensus on international population policy.
From the 1960s, an economic rationale for fertility control was embedded in the
policy approach of ‘family planning’. The ICPD placed a ‘reproductive health
approach’ to population policy at the core of its Programme of Action (UN
1995). One close participant notes that the ‘Cairo consensus’
radically transformed the views and perceptions of thousands of policy

makers and program managers … moving away from top-down approaches
and pre-planned demographic goals to those that would seek to respond to
the needs of ‘couples and individuals’.
(Singh 1998: 1)1
In this chapter, I address two questions. First, what made for the relative
stability of international population policy in the form of family planning for over
thirty years, despite the constant controversies over whether and how to organize
population policy? Second, what accounts for the change in international popula-
tion policy from family planning to reproductive health that occurred through the
ICPD process? It will be argued that a clue to answering both questions is found in
the analysis of the knowledge-policy nexus. This is based on a reading of how the
institution of science, because of its universally recognized cognitive authority,
functions to stabilize international policy by legitimizing and validating certain
facts, theories and concepts that create an internationally shared problem-
definition of, and policy response to, a certain phenomenon. Changes in interna-
tional policy will, in this perspective, have to be understood in relation to the
changing content of that body of knowledge which underwrites an established
policy approach, and which defines the cognitive-normative space in which polit-
ical agency is performed. In an attempt to capture this dynamic, I will make use of
two core concepts: policy stories and knowledge-based regimes. Before we proceed to
discuss these two concepts, however, we need to reflect briefly on how the institu-
tion of science structures the modality of political deliberation and governance.
Policy stories and knowledge-based regimes 57
Science and politics

With the emergence of modern science in the seventeenth century, and its insti-
tutionalization during the next three centuries, the modality of political discourse
and governance undergoes a significant transformation. The metaphysical warrant
for the existence of society is partly replaced by the idea that man produces and
reproduces society through various actions (Touraine 1977). Central to this
process is the secularization and de-mystification of nature and society, and the
concomitant emergence of the belief that society must be known before it can be
governed (see Rose 1999). This makes for the establishment of distinct modern
forms of political discourse; although concerned with what ‘ought’ to be, polit-
ical activity is intimately tied to, and grounded in, representations of how the
world ‘is’. As an institution marked by cognitive authority, science is a crucial ally
for political actors who wish to persuade others that their problem-definition and
concomitant policy response are firmly grounded in facts (Barnes and Edge
1982).
Ezrahi (1990) has analysed the role of the institution of science in securing
democratic modes of political deliberation by making possible the reference to
facts independently produced and accessible to all. For Ezrahi, the significance of
the institution of science lies in the creation of a horizontal (as opposed to a hier-
archical and self-referential) structure of accountability by which actors wishing
to persuade others must refer to and ground their arguments in relation to the
facts.2 It can thus be said that there is an internal, constitutive relation between
the institution of science and modern forms of political discourse, in the sense
that reference to facts about the world is central for getting others to accept and
act upon a certain policy proposal. Various actors may thus be understood to
fund, interpret and use scientific knowledge in order both to try to convince
others of the validity and appropriateness of their preferred objectives, and for
making possible, as we shall see in a moment, the formulation and establishment
of policy practices.
Modern political governance is predicated on the existence of reliable, general
knowledge of the characteristics of the population to be governed (Foucault
1980; Wagner 1994; Rose 1999). Theories about the role of professions attest to
the intimate link between the production and use of scientific knowledge, and
the governance of society (Abbott 1988). As executors of a specific knowledge
base, professions occupy central roles within administrative structures as they,
through this knowledge base, define those categories, concepts and theories that
underwrite and legitimize those discourses that define the meaning of, and point
to solutions for, different phenomena to be addressed through policies.
Desrosières (1991; 1998) has specified the relation between a phenomenon’s
conceptualization through statistical knowledge, and the forms of government
that this renders feasible. A central feature of statistics, Desrosières holds, is that
it serves to objectify and stabilize a specific meaning and significance of a
phenomenon, thus rendering certain policy options more feasible than others.
This position, informed by a scientific realist position, provides a fruitful
58 Ole Jacob Sending
perspective for exploring the knowledge-policy nexus: a phenomenon, like

fertility behaviour, may be categorized, explained and described through knowl-
edge production in a variety of ways, and the resulting conceptualization will,
because of the cognitive authority of the institution of science, structure the
cognitive-normative space in which deliberations on policy take place and the
range of policy options is rendered feasible. By building upon this perspective on
the knowledge-policy nexus we may provide new insights about the role of
knowledge in international policy making.3
Policy stories and knowledge regimes

Granted that the objectification and definition of a given phenomenon is open
to a variety of normative and political considerations, it becomes interesting to
explore how scientific knowledge constitutes a symbolic resource used by politi-
cally motivated actors. In order to justify and legitimize certain courses of action,
and to render these possible and effective, scientific knowledge forms an impor-
tant component both for efforts of persuading and mobilizing different groups,
and for formulating and establishing policy practices. This can be grasped
through the concept of policy stories. A policy story can be defined as follows:
A set of factual, causal claims, normative principles and a desired objective,

all of which are constructed as a more or less coherent argument – a story –
which points to a problem to be addressed and the desirability and
adequacy of adopting a specific policy approach to resolve it.
This conceptualization incorporates how politically motivated actors integrate

scientifically produced knowledge in the form of facts, concepts or theories in
order to
(i) convince others that a certain phenomenon is a problem,

(ii) demonstrate that this problem is best understood in a certain way, as shown
by the facts presented, and
(iii) link these factual claims to normative principles giving moral force to the
argument that it should be resolved.
This perspective thus subjects the factual dimensions of political processes to the
interests and normative commitments of actors, in the sense that knowledge is
used to justify and legitimize calls for adopting certain policies to resolve what is
seen to be a problem that ‘ought’ to be resolved.
The formulation is partly inspired by Rein and Schon (1991: 265), who refer
to problem-setting stories that ‘link causal accounts of policy problems to partic-
ular proposals for action and facilitate the normative leap from “is” to “ought” ’.
We depart from Rein and Schon’s conception somewhat by emphasizing more
strongly the factual claims (the characteristics of a phenomenon) and normative
principles (the morally–grounded principles used to legitimize the policy formula-
tion) invoked by actors as they define a problem and argue for a specific policy
approach. The concept of policy stories seeks to capture how actors integrate
knowledge claims into their politically charged arguments so as to ‘frame’ the
issue under discussion. Because of the interlocking of the factual and normative
dimension of policy making, a policy story can be seen to create space for political
agency. That is: a policy story serves, by creating an argument grounded in a body
of scientifically produced knowledge, to persuade and mobilize different groups
as it represents a complete package: an authoritative problem-definition and a
concomitant policy solution that is legitimized in both factual and normative
terms.
A policy story that wins acceptance at the discursive level can be seen to
define the terms of the debate for the establishment of policy and to de-
legitimize competing conceptualizations and policy approaches. Through the
political agency performed through a policy story, it may come to dominate
the policy field as it forms the central cognitive-normative organizing device for
specific formulation and establishment of policy within different organizations.
In this way, the policy story may over time attain a ‘taken for granted’ char-
acter as it comes to structure, and reflect, policy practice. This process of
stabilization is best described as a process of institutionalization. Following Scott,
we can define institutionalization as a ‘process by which a given set of units
and a pattern of activities come to be normatively and cognitively held in
place, and practically taken for granted as lawful’ (Scott et al. 1994: 10). This
latter feature is critical to the argument presented here. In the change from an
argument for a specific policy approach to the establishment of that policy in
practice, the policy story comes to define the cognitive-normative outlook of a
policy regime. This can be defined as an interlock between the knowledge which
underwrites the policy story, and the establishment in practice of the policy
advocated in a policy story. That is: the knowledge that once formed part of an
argument for a policy is now an integral part of the very rationality and iden-
tity of the organization involved with managing this policy in practice. As such
it becomes part of the bundle of routines, rules, priorities and rationality of
the organizations in the policy field (see Douglas 1986; March and Olsen 1989;
Scott and Meyer. 1994).
Below, I employ the two concepts of policy story and knowledge-based
regime to account both for policy change and policy stability in international
population policy. I start off by tracing the formulation of the policy story of
family planning, and proceed to discuss how this policy story, over time, formed
the cognitive-normative identity of the emerging regime of population policy.
Despite long-lasting and fierce political criticism from religious authorities, femi-
nists and others, family planning defined the very identity of the policy field of
population in the multilateral system. I then trace the process of formulating an
alternative policy story of reproductive health. I conclude by reflecting on how
the reception of the policy story of reproductive health was conditioned in its
reception by the cognitive-normative content of the existing regime of family
planning.
The making and institutionalization of the policy story

of family planning
Establishing population policy to reduce population growth came about through
the operations of a loosely coupled network of individuals that approximated a
‘population movement’ with its basis in the United States (Dixon-Mueller 1993;
Hodgson and Wattkins 1997). For this reason, we shall focus specifically on
developments in the United States in the post-World War II era, and trace how
this network, advocating population control, built up a policy story that was
exported internationally, with the aim of establishing family planning programmes
in the developing world. Over time, the policy story of family planning effectu-
ated the establishment of international population policy, and it thus came to
form a regime that, in its cognitive-normative outlook, was based on an
economic rationale for fertility regulation.
Creating a policy story

In the years immediately following World War II, the idea of governmental
intervention to influence fertility levels was outside international political
discourse. There was a general perception that governments had no business to
intervene in something as private as reproduction (Sharpless 1997). All of this
was to change in the next two decades, as the late 1960s saw a number of inter-
national and national organizations establish population policies in the form of
family planning to reduce population growth (Dixon-Mueller 1993). Through
the efforts of a neo-Malthusian movement consisting of businessmen, public
advocates and researchers, the terms of this debate were recast through the
strategic funding and interpretation of scientific knowledge, and through the
linking of this knowledge to set of normative goals of securing and perpetuating
(American) peace, stability and prosperity. The individuals involved in this effort
were convinced that: ‘To make the world safe for American democracy, global
population needed to be controlled. American know-how and technology were
needed to avert another war’ (Critchlow 1999: 13).
The so-called ‘theory of demographic transition’ posited a causal relationship
between economic growth and fertility levels. High population growth rates in
the developing world were seen as an obstacle to economic growth. In its original
formulation in 1945, the theory postulated the latter as a dependent, not an inde-
pendent variable: socio-economic factors associated with development and
modernization were used to explain changes in reproductive behaviour, not the
other way around. The theory was based on historical data from Western
Europe, where improved standards of living (socio-economic development) went
together with reduced fertility levels. Initially, the driving forces behind reproduc-
tive decisions were embedded in social and cultural norms, which could not be
easily changed and were subject to large-scale processes of modernization
(Szreter 1993: 668). Later, in the early 1950s, Frank Notestein reformulated tran-
sition theory so as to identify fertility behaviour as an independent variable that
could be manipulated to advance and speed up the process of development. In
an address at an international conference in 1952 consisting of actors involved

with economic planning, Notestein ‘elaborated upon the apparently optimistic
policy implications of the newly formulated possibility of reverse causation in
demographic transition’ (Szreter 1993: 679).
The strategic reformulation of the theory of demographic transition, in
which the causal arrow was reversed, must be seen in light of the political moti-
vation of Notestein and an emerging ‘population movement’. There was a very
grave concern that high population growth would lead to political instability,
particularly in Asia and Africa, and that this would threaten vital American
interests, particularly in light of the competition with communism.
This theoretical reformulation had significant implications, as it meant that a
clear rationale for contraceptive delivery through family planning programmes
was firmly grounded in the most authoritative theoretical formulation of the
relation between fertility behaviour and economic growth.
John D. Rockefeller III had sought in the early 1950s to get the board of
Rockefeller Foundation involved in the field of population. Due to the controver-
sial character of the issue, the board refrained. Rockefeller instead established
the Population Council in 1952, with the explicit goal of seeking to legitimize
through research the claim that family planning programmes should be estab-
lished so as to facilitate socio-economic development in the South. Established as
a research institution, the Council was intended by Rockefeller also, over time, to
get involved in action-programmes (Harr and Johnson 1991: 41). Together with
the Office of Population Research at Princeton University under the leadership
of Frank Notestein, a friend of Rockefeller, the Population Council served as a
key producer of the knowledge which served to establish scientifically that there
was indeed a direct relation between population dynamics and economic
growth, and that it could and should be addressed through family planning
programmes that would deliver contraceptive technology.
In short, the calls for family planning programmes were constructed as a
policy story that established through science that there was indeed a relationship
between population growth and economic development, and that this could be
manipulated through family planning programmes. It linked this problem-
definition and policy response to the evident goals of making developing coun-
tries more economically advanced and prosperous. The link between ‘is’ and
‘ought’ was particularly strong, as there was, in terms of research, no body of
scientifically produced knowledge that seriously challenged the facts upon which
this policy story was based. In an era where the idea of social engineering by
technological fixes stood strong,4 and the ideological contest with communism
provided the normative framework to ground calls for action in the name of
security,5 family planning over time won acceptance, as the public was
persuaded, and governmental officials came to perceive it as a cost-effective way
of addressing a pressing problem.
The population question was controversial, however, as it challenged religious
convictions and also raised questions of whether this was a proper concern for
governments. On the question of whether the government should get involved in
the regulation of reproductive behaviour, President Eisenhower declared, in

1959, that ‘I cannot imagine anything more emphatically a subject that is not a
political or governmental activity or function or responsibility’ (New York Times, 3
December 1959, 1. Quoted in Dixon-Mueller 1993: 61). However, following
successful lobbying by the population movement during the 1950s and 1960s, of
political and public officials in the White House, State Department, USAID and
the Ministry of Defense, the US government, as well as an increasing number of
developing countries and international organizations, came to endorse family
planning.
Thus, in 1965, President Johnson said in a speech at the twentieth anniver-
sary of the establishment of the United Nations: ‘Let us act on the fact that less
than five dollars invested in population control is worth a hundred dollars
invested in economic growth’ (ibid.: 62. Emphasis added). Following an emerging
support of family planning endorsement in the Kennedy administration,
President Johnson took it further, as Congress enacted the Foreign Assistance Act
in 1967, granting $35 million for family planning (Critchlow 1999: 78). The shift
in policy orientation on the part of the US reflects a more general trend that can
be found internationally during the same period (Sharpless 1997; Critchlow
1999). Starting from the mid-to-late 1960s, a range of international organiza-
tions became involved in population policy in the form of family planning. The
year 1968 saw the World Bank become involved in family planning, and 1969
saw the establishment of the United Nations Fund for Population Activity
(UNFPA). In 1965, USAID started to fund family planning programmes. In the
same period ‘the specialized agencies such as WHO, FAO, UNESCO, ILO and
UNICEF were increasingly active’ (Dixon-Mueller 1993: 63).
Stabilizing international population policy: the formation of

a knowledge regime
Demographic research grew rapidly, precisely because demographic knowledge
conformed to and was compatible with the goals of the increasingly well–funded
field of population. Demographic research in this way became the scientific
grounding or basis of a politically motivated movement; the latter being the
major financer of the former. Critchlow notes that the decade between 1950 and
1960 saw an emerging international network of demographers:
demography became not just a science but a policy science that viewed
intervention in population growth as necessary. Professional demographers,
academically trained at the leading universities, became members of profes-
sions that shared a core body of knowledge, a consistency in methodology,
and a common discourse. Institutionalized through professionalized associa-
tions and supported by the philanthropic community. … population experts
accepted intervention in population with an almost evangelical fervor.
(1999: 2. See also Hodgson 1988)
An interlocking of mutually reinforcing objectives in terms of promoting

economic development, and countering the threat of communism served to
identify family planning programmes as a necessary element in plans for socio-
economic development (see Demeny 1988; Hodgson and Watkins 1997; Presser
1997).
The UNFPA, the World Bank, USAID, and a range of non-governmental
organizations such as the International Planned Parenthood Federation, as well as
national organizations, were all, during the 1960s, involved in refining, estab-
lishing and administering family planning programmes. Through the training and
hiring of personnel, the development of rules, organizational objectives and orga-
nizational units committed to family planning programmes, the policy story of
family planning formed, over time, part of the institutional rationality and routine
of these organizations.6 Through this process of institutionalization, a regime was
formed with its basis in the policy story of family planning. When the environ-
mental movement came to force in the 1970s, it appropriated the already
institutionalized idea that family planning programmes constituted a key policy
tool to reduce population growth and thus preserve the globe’s natural resources.
The profession of demography, although dependent on the expertise of health
professionals in the field, did not allow for the integration of a clear health
perspective in the effort to reduce population growth. This can be seen, for
example, in the failure of the World Health Organization to establish its own
population programmes in the 1960s, and in its continual conflicts over coordina-
tion of its primary health-care programmes with UNFPA’s family planning
programmes (Haas 1990: 139–40). Further, the UN Population Division, staffed
with demographers, and the International Union for the Scientific Study of
Population (IUSSP) co-organized the first two international conferences on popu-
lation, in Rome in 1954 and in Belgrade in 1965. From its very infancy, then, the
categories, facts and theories defining the cognitive-normative outlook of popula-
tion policy were in the hands of demographers, all of whom promoted family
planning. In the process, demography became a policy science (Hodgson 1983).
The regime defined by the policy story of family planning sustained attacks
from an emerging women’s movement and from health professionals, which
called for a stronger emphasis on health as an end in itself (Dixon-Mueller
1993). In more theoretical terms, this knowledge-based regime served to stabilize
the means and ends of population policy which enabled it to endure in the face
of continued conflicts and criticism, especially from the Catholic church,
precisely by virtue of providing a relatively stable ‘background consensus’, in
terms of certain facts and theories that remained unchallenged.
Creating space for political mobilization: the making

of the policy story of reproductive health
From the establishment of population policy at the international level in the late
1960s, until the ICPD in Cairo in 1994, family planning was population policy.
Its longevity is remarkable, considering that the limitations and problems of the
approach revealed themselves rather quickly. Indeed, as early as 1972, the presi-
dent of the World Bank, Robert McNamara, told the Population Council’s
president Bernard Berelson that there was a growing concern that family plan-
ning was ‘too simple, too narrow and too coercive’ (Critchlow 1999: 178). Also,
developing countries were starting to mount criticism against family planning for
not addressing the root causes of population growth, namely poverty, economic
injustice and the organization of world trade.
Just as the formulation of the policy story of family planning was a strategic
effort on the part of a population movement concerned with the economic prob-
lems engendered by population growth, the emerging women’s health movement
was equally strategic in its efforts to advance a different policy approach focused
on the health and rights of women. Their efforts took the form of strategically
commissioning and using research to establish a different problem-definition of
fertility behaviour, one that emphasized the importance of paying more atten-
tion to the socio-economic status, rights and health needs of women.
Creating space: formulating an alternative policy story

Interestingly, John D. Rockefeller III played a critical role in taking the first steps
to re-direct population policy away from a sole focus on family planning. Already
in 1974, at the first UN-organized inter-governmental population conference,
Rockefeller argued that ‘family planning programs that have been undertaken
have proved inadequate when compared to the magnitude of the problems
facing us’, and continued by asserting that: ‘Population planning programs must
be placed within the context of economic and social development’ (Critchlow
1999: 181).
The only detectable effects of this speech, besides the controversy it generated
at the conference itself, were changes in the staff and research-orientation at the
Population Council in the years that followed. Joan Dunlop was the person
behind the scenes in these developments. Rockefeller had hired her in 1973 as
his assistant on population matters. Bringing a feminist perspective to the
thinking on population, she was instrumental both in writing Rockefeller’s
Bucharest speech and in selecting George Zeidenstein as the new head of the
Population Council (Critchlow 1999: 179).7 Gradually, the research focus of the
Population Council changed towards addressing the health dimension of family
planning programmes, and the causal significance of the quality of family plan-
ning services for increasing contraceptive use. This was significant, as the
Population Council is arguably the most influential research institution in inter-
national population policy, through its close contacts with US foundations,
USAID and foreign health and family planning administrators.8
Adrienne Germain came to the Population Council in 1985 from a position
at the Ford Foundation’s office in Bangladesh. Germain had for a long time
advocated both the need for changing the research orientation in the field of
population, and for re-organizing family planning programmes to respond to the
health needs of women. In 1987, Zeidenstein asked Germain to write a paper
for a conference in Nairobi entitled ‘Better Health for Women and Children
through Family Planning’ and organized by the World Bank, WHO and
UNFPA. Germain decided to use the paper to call for a ‘reproductive health
approach’ to population policy. In this initial formulation, ‘a reproductive health
approach’ meant integrating the already existing child survival programmes with
family planning programmes to ensure a broader basis of service delivery that
went beyond mere contraceptive delivery. At the time, none of these
programmes were focusing on the broader health issues related to reproduction
and addressing the concerns and rights of women.9
This conference paper marks the first steps towards the development of the
policy story of a ‘reproductive health approach’. Incidentally, Mahmoud
Fathalla, Director of the WHO’s Special Programme on Human Reproduction,
wrote an article in 1988, published in Human Reproduction, a WHO journal, that
called for the same kind of re-orientation of population policy that Germain was
seeking to effect with her paper. These two papers by Germain and Fathalla
reflect a convergence between feminist criticism of existing programmes, and a
concern in the WHO and in the health profession more generally that family
planning was too narrow and did not address the broader health issues involved
in human reproduction. This convergence would later prove critical to the
women’s health movement, as it meant that their calls for re-orientation of popu-
lation policy had an ally in the central international authority in the health field,
the WHO.
Germain’s paper did not go down well at the conference, as it challenged the
cognitive-normative outlook and objectives of the knowledge regime of family
planning, and was, in her words, ‘heavily resisted’.10 Later, when Germain came
to work with Joan Dunlop at the International Women’s Health Coalition (an
advocacy NGO), they developed a strategy of seeking to reshape the population
field from the inside.11 This meant shying away from the more radical systemic
criticism that certain elements of the women’s movement had earlier launched
against the population field (see Dixon-Mueller 1993). The strategy was quite
explicitly to document and ground through scientific knowledge the health risks of
Third World women related to reproduction, and to point towards a policy
approach that would integrate the economic rationale for fertility regulation with
its health aspects.
In 1987, the IWHC got involved in research on the issue of reproductive tract
infections (RTIs) and sexually transmitted diseases (STDs) among women in the
Third World. Prior to this, all research on these issues had focused on high-risk
groups such as commercial sex workers, and was not included in discussions
about family planning programmes (Dixon-Mueller and Wasserheit 1991;
Wasserheit and Holmes 1992). The work culminated in the convening of a high-
profile conference of health experts in 1991, out of which came a book, edited
by Germain and three others, which not only documented the seriousness of the
problem, but which also included a section with ‘recommendations for action’
(Germain et al. 1992). It was a strategic effort on the part of Germain and other
like-minded actors to construct a policy story of reproductive health12 grounded
in scientifically produced knowledge, and so strengthen and make legitimate

their calls for a re-orientation of population policy more attuned to the rights
and needs of women.
At the Population Council, Beverly Winnikoff, Judith Bruce and Anrudh Jain
in the late 1980s initiated a new research project focused on the ‘quality of care’
of family planning programmes. The objective was to highlight the importance
of taking ‘the user’s perspective’ and to assess the effectiveness of family plan-
ning services in the context of the quality of the services provided, which was
assumed to have an impact on the degree to which people were using them.
Their research revealed, for example, that the methods used to measure the
effectiveness of family planning programmes, such as Contraceptive Prevalence
Rates (CPR), and Couple Years of Protection (CYP), failed to examine the
clearly important issue of whether the methods offered were in fact used. That
issue can only be addressed, they argued, by assessing the perceived quality of
the services provided, and by examining the social and cultural context of repro-
ductive decision making and obstacles to contraceptive use ( Jain and Bruce
1994). On this basis, they proposed a two-pronged strategy that integrated health
concerns with the already established economic rationale for fertility regulation.
It held that if you want to reduce population growth, the most effective and
humane way of doing so is to
(i) make family planning programmes ‘responsible for reducing unplanned and
unwanted childbearing and related morbidity’, and
(ii) make ‘Broader social and economic policies … responsible for reducing
levels of wanted fertility’ (ibid.).
The significance of this research was partly that it documented serious short-
comings with the existing family planning approach; partly that it identified that
this could be resolved through a focus on the health dimension of fertility. The
policy story of ‘reproductive health’ in this sense invoked a different body of
knowledge to undermine a series of assumptions that were contained in the insti-
tutionalized policy story of family planning.
Persuasion and mobilization

The effect of the work of the IWHC and the research produced at the
Population Council can be seen by the impact it had on the new policy approach
of the world’s largest non-governmental family planning organization, the
International Planned Parenthood Federation (IPPF). In the early 1990s, the
IPPF was establishing a new strategy document. At the IPPF headquarters in
London, Med Bouzidi was in charge of writing a draft of the strategic plan –
Vision 2000. In formulating this new strategy document, Bouzidi made use of
the arguments presented by Germain and Dunlop at the IWHC on ‘reproduc-
tive health’, and the research done by Bruce and Jain at the Population Council
on the ‘quality of care’.13
The policy story of a ‘reproductive health approach’ challenged and created

space for a different policy approach to population policy. First, it held that
family planning programmes are potentially coercive to women, referring to
projects in China, India and elsewhere, where women’s basic rights had been
violated in the name of economic growth. Second, it challenged the idea that the
mere delivery of contraceptive technology and services is enough to reduce
population growth, let alone empower women and address their health needs
and rights. Instead, it pointed to the centrality of providing women with educa-
tion and jobs, and addressing gender relations and teenage sexuality to reduce
fertility. Third, it challenged the narrowness of the focus of family planning,
saying that it advanced a ‘demographic imperative and a technological fix’, and
pointed to the need for addressing an emerging set of problems that were critical
not only for reducing population growth, but also for the challenges posed by the
HIV/AIDS pandemic, sexually transmitted diseases, reproductive tract infec-
tions, female genital mutilation, etc.
The IWHC was crucial in spreading the word and in mobilizing different
groups around the policy story of reproductive health during the ICPD process.
Together with organizations such as WEDO,14 the IWHC brought together
several constituencies under the policy story of reproductive health. Not only did
IWHC, WEDO and other like-minded actors fund NGOs in the South, which
enabled them to travel to meetings and conferences; they also helped fund and
persuade the governments of the South to include these NGOs’ representatives
in national delegations. Importantly the IWHC and CEPIA convened, in
February 1994, what the participants referred to as the ‘feminist prep.com’ that
formulated the ‘Rio Declaration’, laying down a common vision and strategy for
proceeding with the ICPD process.
These and other gatherings and networking processes served to mobilize
several different groups and organizations around the policy story of reproduc-
tive health. The ‘Rio Declaration’ was sent to the ICPD secretariat and used
frequently during the ICPD as a background document for persuading govern-
ment officials and for suggesting specific wording in the draft ICPD document.
Their advocacy, furthermore, came at an opportune time, as several govern-
ments used the preparations for the ICPD as an opportunity to evaluate their
stance on population policy. In this context, the policy story of reproductive
health, since it was grounded in scientific facts and legitimated through a
discourse on human rights and health, proved persuasive. Over time, it gath-
ered the support of a broad range of governmental and non-governmental
organizations.
In February 1991, just prior to the start of the ICPD preparatory process, the
IWHC and the Special Programme on Human Reproduction of the WHO held
a joint conference in Geneva which resulted in a report entitled ‘Creating
Common Ground: Women’s Perspectives on the Selection and Introduction of
Fertility Regulation Technologies’ (WHO 1991). Later, during the heated debates
about the proper definition of reproductive health during the ICPD process, the
WHO came to the rescue of the women’s health advocates and issued a
definition with the approval of the secretary-general of the WHO. This authori-
tative definition of reproductive health served to legitimize the policy story of a
reproductive health approach to population policy.
The structuring effect of the existing knowledge regime

The policy story of reproductive health had, in order to be persuasive to several
constituencies, to make reference to how it would in fact further those interests
embedded in the organizations that, ever since the 1960s, had been in charge of
formulating and administering family planning programmes. John Bongaarts at
the Population Council had through his research documented that, although
family planning services had been effective in reducing fertility levels in the
developing world, they were not as effective as perceived, and would be less
effective in the future. The argument, popularized in an article in Science in
February 1994, was that of the three causes of population growth (unwanted
fertility, high desired family size and population momentum), family planning
programmes address only the first-mentioned cause, not the other two, which
together had a greater influence on the total population growth than the first
(Bongaarts 1994). Addressing the two other causes would mean: first, imple-
menting programmes that sought to change the desired family size, which would
mean addressing gender issues, promoting girls’ education, and influencing the
socio-cultural norms for family size; and second, educating teenagers on issues of
sexuality and to delay early births by providing education, especially for women
(Population Council 1994).
This argument further strengthened the policy story of reproductive health,
in that it established that further reduction of population growth in the name of
socio-economic development must move beyond family planning programmes
and include a focus on general health issues, education (especially for women),
teenage sexuality, and so on. In August 1994, Bongaarts was invited to brief US
Secretary of State Warren Christopher and Vice-President Al Gore in prepara-
tion for the ICPD. Coming from an environmental background, Gore was
mostly concerned with population growth, not women’s issues in this context,
and was only reluctantly supporting the right to abortion domestically.
Persuading Gore would mean establishing that a reproductive health
approach would indeed be effective in reducing population growth. And
Bongaarts’ message came through. Just prior to the ICPD, Gore held a press
conference in which he called for a more ‘comprehensive and humane strategy’
to reduce population growth that included a focus on girls’ education, educating
and empowering women, addressing unsafe abortions, and that generally ‘fosters
women’s health’.15 Bongaart’s analysis proved essential because all the central
organizations in the field of population – governmental, inter-governmental and
non-governmental – jealous of their budgets and accustomed to think and act in
terms of family planning with the aim of reducing population growth, had to be
persuaded that a reproductive health approach would in fact be consistent with
their long-term efforts and goals.
The impact of the policy story of a reproductive health approach on the

ICPD Programme of Action notwithstanding, it remains to assess what effect it
has had in actual policy formulation and implementation. As we will see, there
has been a marked discursive shift in the field of population, in which reproduc-
tive health now forms a most crucial concept, partly replacing that of family
planning.
The problems of implementation

Jain concludes, in a review of population policies, that: ‘While governments of
all developing countries have unanimously adopted the [ICPD] Programme of
Action, an actual shift at the policy level and especially at the program level has
not been swift’ (Jain 1998: 16). An assessment of the implementation of the
ICPD Programme of Action concludes that although some progress has been
made, it is clear that:
The reproductive health approach is still not widely understood, even within
countries that have incorporated the approach into policy and strategic
documents. This has led to concerns in some developing countries, such as
Egypt and Indonesia, that the momentum gained through family planning
programs in containing population growth will be lost if the reproductive
health agenda is adopted. Vested interests and ideological positions also
impede progress in implementing the reproductive health approach. Until
facts and resources are mobilized in support of the reproductive health
approach, it is likely to be an ‘add on’ to family planning programs rather
than encompassing them.16
Our analysis above suggested that the reproductive health approach was
effective as it undermined key assumptions of the existing knowledge regime
and, on this basis, inserted new objectives (women’s health and rights) that were
defined as central to the advancement of the goal of reducing population
growth. Yet, at this quote illustrates, the problems of implementation of the
reproductive health approach suggest that the institutionalized policy practice of
family planning, consisting of a network of population experts and programme
managers, and of organizational routine and priority, heavily structures the
motivation and ability to implement a reproductive health approach. This goes
to show that once established as practice and over time consolidated and institu-
tionalized, the cognitive-normative outlook of a policy field does have a strong
structuring effect on the process of establishing new policy practices.
Conclusion
Several observers have noted that the outcome of the ICPD was due to the
efforts of a globally organized women’s health movement (see Finkle and
McIntosh 1995; Johnson 1995; Hodgson and Wattkins 1997; Singh 1998). My
interpretation, in drawing attention to the knowledge-policy nexus, is that this

must be understood in the context of the way in which these actors strategically
used knowledge to formulate an alternative policy story, one that made possible
the establishment of a women’s health perspective within the already established
knowledge regime of family planning. The policy story of reproductive health
opened up cognitive-normative space for the consideration of a new policy
approach. This policy story served as the mobilizing platform for a range of
women’s organizations, both in the North and the South, and enabled the
performance of effective political agency during the ICPD. In effectuating a
change at the discursive level, the reproductive health approach has clearly
inserted a clearer health rationale for population policy. The resistance to the
new approach, and the slow process of concrete organizational change, attests to
the hold of the already institutionalized goals and views contained in the policy
story of family planning.
Notes
1 Singh was Deputy Secretary General to the Conference, and a close aide of the
Secretary General of the Conference, Executive Director of UNFPA, Nafis Sadik.
The Under-Secretary of Global Affairs for the United States, Timothy Wirth,
declared on the last day of the conference that ‘The World will never be the same
after Cairo’, while Nafis Sadik referred to the Programme of Action as a ‘paradigm
shift’ (Singh 1998). For similar interpretations of the ‘Cairo consensus’ from less
involved observers, see Johnson 1995; Finkle and McIntosh 1995; Hodgson and
Wattkins 1997.
2 See Habermas 1998a, for an extensive treatment of the relation between facts and
norms in his model of deliberative democracy.
3 For analyses of the role of knowledge in international policy making, see Haas 1990;
Haas 1992; Litfin 1994.
4 For a good discussion of the notion of social engineering in the decades following
World War II, see Wagner et al. 1991; Wagner 1994; Ezrahi 1990.
5 Kingsley Davis, the second main contributor to the theory of demographic transition,
noted in an article in Foreign Affairs in 1958 that the US government should address
population growth in the context of the fight against communism (Davis 1958: 296).
When President Johnson sought support in Congress for international population assis-
tance in 1966, Hodgson reports that he did so on the grounds that high population
growth in the developing world ‘challenges our own security’ (Hodgson 1988: 549).
6 In the case of the World Bank and USAID, this relates to their offices of population.
7 Interview with Joan Dunlop, 10 May 2000.
8 Barbara Crane (1993) notes in her analysis of international population institutions:
‘The Population Council … has probably been the single most important supporter
of policy and program research’ (380).
9 Interview with Adrienne Germain, 10 August 2000.
10 Ibid.
11 Interview with Joan Dunlop, 10 May 2000.
12 Focusing on the efforts of Northern, primarily American, advocates does not imply
that there were not similar networks of like-minded actors in Africa, Asia and Latin
America. Germain had developed some of the basic ideas of proposing a reproduc-
tive health approach together with Sandra Kabir, who had set up in Kenya in the
1980s a health clinic that was sensitive to the demands of women in the region.
Similarly, the CEPIA network in Latin America played a crucial role in contributing
to the formulation and advancement of the policy story of reproductive health, both
in this period and through the ICPD. Interviews with A. Germain, 10 August 2000; J.
Dunlop, 10 May 2000; A. Kabir, 30 August 2000.
13 Interview with Med Bouzidi, 5 April 2000.
14 Women’s Environmental and Development Organization.
15 Transcript of remarks by Vice President Al Gore, National Press Club, Washington
DC, 25 August 2000.
16 Executive summary of S. Forman and R. Gosh (1999) ‘The Reproductive Health
Approach to Population and Development’, at http: //www.nyu.edu/pages/cic/
projects/pophealth/book_Publish.html#inter.
6 The World Bank and the
environment
Robert Wade
Introduction
No other field of World Bank operations has grown as fast as its environmental
activities. Starting with just five environmental specialists in the mid-1980s, the
Bank employed three hundred a decade later, complete with a vice presidency
for ‘environmentally sustainable development’ (World Bank 1994: 157).
On the surface, the history of the Bank’s environmental activities appears to
be a case of new insights leading an institution rapidly to integrate new objec-
tives and criteria into its operational routines. According to the Bank, the change
is the result of staff and management’s ‘increasing understanding of the rela-
tionship between environmental protection and development’ (Shihata 1995:
184). But its many environmental critics say that the change has been driven
largely by environmental non-governmental organizations (NGOs) mounting
high-pressure campaigns to force the Bank to change its ways.
This chapter tells two stories. One is about the factors that led the Bank to
pay attention to environmental criteria. The other is about the effects of its orga-
nizational structure and incentive system on what it has and has not done to
advance environmental objectives.
Frontier economics with ‘environment’ added:

the 1970s
When in the early 1970s, in response to burgeoning public concern with ‘envi-
ronment’ in the West, the word entered into the Bank’s lexicon, the staff was
both sceptical and perplexed. They were sceptical because some environmental
concerns seemed to be nothing new; perplexed because some sounded fuzzy,
complex, and unquantifiable, and a threat to the familiar routine of project
work.
In 1970 Robert McNamara took the occasion of his annual address to the
United Nations Economic and Social Council to speak about the need to help
developing countries mitigate environmental damage caused by economic
growth. McNamara told his audience that the Bank had just created the post of
environmental adviser to direct the Bank’s environment work. This made the
The World Bank and the environment 73
Bank the first multilateral or bilateral agency to have an environmental adviser.

Because the Bank was later to become the target of savage environmental criti-
cism, its early leadership in this area deserves emphasis.
Why did McNamara take this initiative? The broader context provides some
clues. The late 1960s was a time of growing concern about environmental issues
in the West, especially in the United States. The number of articles on the envi-
ronment in the New York Times rose from 150 in 1960, to 1,700 in 1970. Several
schools of thought on the subject began to form and jostle for support, sharing
an explicit regard for the value of ‘the environment’ and a disbelief that
economic decisions based on market prices could safeguard that worth. They
were reacting against what Kenneth Boulding usefully called ‘frontier
economics’, the reigning assumption that economic growth and material pros-
perity were limitless, unconstrained by either ‘sources’ – the supply of natural
resources – or ‘sinks’ – the waste-absorbing systems of the biosphere.1 The most
moderate reaction, beginning around the middle to late 1960s, came to be
known as the ‘environmental protection’ approach. Threats to endangered
species and the health effects of pollution and toxic wastes were considered the
prime targets of public action, and legislation was sought to prevent unpriced
environmental services from being overexploited. The US government,
responding to pressures from US environmental groups, passed the National
Environmental Policy Act in late 1969, which required US government agencies
to undertake environmental assessments designed to mitigate or avoid the envi-
ronmental damage caused by public investment projects.
As the recognized lead agency in the work on development issues, the Bank
could not remain oblivious to this rising tide of concern, particularly because
many in the new environmental movement were saying that economic growth
should be stopped, an idea fundamentally opposed to the Bank’s mission. In
addition, the Bank had to consider what position it would take at the United
Nations Conference on the Human Environment scheduled for 1972 in
Stockholm. The prospect of having to stand up and explain what the Bank had
been doing to protect the environment forced McNamara to think about what
the Bank should be doing.
With the Stockholm conference in prospect, McNamara established the post
of environmental adviser, to which he appointed James Lee. Lee was an
American expert in public health and epidemiology, with earlier experience as a
game warden in the United States. He remained the Bank’s chief adviser on
environmental matters until he retired in 1987.
The United Nations Conference on the Human

Environment, 1972
The Stockholm conference put the ‘environment’ on the international agenda,
and the World Bank did play an important role in this process. Late in 1971 it
looked as though the whole conference might founder before it began (Prestre
1989). The developing-country representatives claimed that the conference was
74 Robert Wade
being strong-armed into adopting a rich-country view of environmental prob-

lems, seeking to impose on them mitigation measures that would only add to the
costs of economic development and slow it down. As Lee recalled, the devel-
oping countries:
threatened to pull out of it. … So [Maurice Strong, chief organizer of the

conference] called upon the World Bank and said, ‘Well, after all, you are
the closest to the developing countries. … The developing countries will
listen to you if you can make a case for us, that is, a case for the environ-
ment and its importance to the developing countries’. The Bank then
assigned the responsibility for that to two of us. One was Mahbub ul Haq,
who was going to look at it from the standpoint of the developing countries
and economics. … I was going to look at it … from the point of view of
identifying the environmental problems, the linkages, the relationship to
people, and so on.2
The critical meeting was held in the village of Founex, Switzerland in 1971.
This is where the first steps were taken toward the marriage between ‘develop-
ment’ and ‘environment’. In the event, Mahbub ul Haq persuaded the
developing-country delegates that ‘there really was good cause, both then and in
the future, for them to be concerned about these matters’. And the Bank helped
gain their support by agreeing to provide funds to cover any additional costs
directly attributable to its environmental standards. The Founex report became
the basis of the Declaration, Principles, and Recommendations issued by the
Stockholm conference. It was largely drafted inside the World Bank, by Mahbub
ul Haq and his team (Prestre 1989: 83).
At the conference itself, McNamara delivered a keynote address announcing
the first formal commitment to environmental soundness in development from
any of the multilateral development banks. This speech established the World
Bank as the leading agency in dealing with the environmental problems of devel-
oping countries. In addition, the World Bank environmental adviser was a
principal figure in the preparatory work, and senior World Bank official Mahbub
ul Haq was the key person in persuading the developing countries not to
withdraw.
Loss of momentum after 1972

All through the 1970s and into the 1980s the Bank was considered a leading
advocate of environmental protection among those concerned with such issues.
Yet having acquired the mantle of leadership, the Bank downplayed environ-
mental issues in the years that followed, both to the outside world and still more
to itself. Only three months after the Stockholm conference, McNamara made
no mention of environmental issues in his annual report to the Board of
Governors, neither in his review of Bank activities during the previous year nor
in his outline of the programme for the next five years. Of the eleven annual
reports between 1974 and 1985, only one had a separate section on the Bank’s
environmental work. Why? The answer has to do with McNamara’s under-
standing, a change in the US role, and the wishes of borrowing countries, the
inclinations of staff, and the nature of the environmental debate.
McNamara himself, though committed to minimizing the environmental
damage caused by Bank projects, thought that the Bank could do what was
needed with a minor initiative, worthy of no more than occasional advertising.
He drew a contrast with the poverty work. ‘We saw the direct attack on absolute
poverty as very complex. We did not see the requirement of avoiding significant
environmental damage as very complex. This reflected a lack of understanding
on our part.’3
At the start of the 1970s the US government had taken a leadership role in
multilateral environmental issues, but then it suddenly retreated. This move coin-
cided with a wider sputtering-out of its leadership across the whole of the UN
system as it became preoccupied with the 1973 oil crisis ( Jacobson and Kay 1979).
Developing countries (especially big and important ones such as India and
Brazil) reasserted their doubts about the Bank’s role. This reflected their
disagreement with the North’s pressure for environmental protection measures at
the expense, as they saw it, of economic growth.
Inside the Bank a large majority of the staff was also sceptical about
McNamara’s idea of subjecting Bank projects to scrutiny by self-styled ‘environ-
mentalist specialists’ using different standards from their own ‘good professional
practice’. And like the developing countries, they equated ‘environmental’ prob-
lems largely with pollution (rather than, say, deforestation, desertification, or soil
erosion), and saw pollution as a problem connected with affluence and therefore
one that developing countries could afford to ignore.
In response to the burgeoning environmental movement, mainstream
economists, political conservatives and industrialists in the West began to
harbour anti-environmental sentiments. Some commentators portrayed the envi-
ronmental movement as a Trojan horse for socialism. Much of what the World
Bank said about the environment in the several years after Stockholm seemed
intent on demolishing the idea of limits to growth. Little effort was made to set
out a more positive agenda based on analysis of the environmental problems of
developing countries (Haq 1972).
In short, the Bank’s borrowers and most of its staff were sceptical about intro-
ducing explicit environmental considerations and self-styled environmental
professionals. The Stockholm conference provided them with an excuse: it set up
a new UN agency, the United Nations Environmental Programme (UNEP), to
carry forward the Stockholm agenda. Its members could now say: let the Bank
take care of development, let UNEP take care of environment.
Pressures for change: Polonoroeste, Brazil, 1979–89

The principal objective of the Polonoroeste (‘northwest pole’) project was to pave
a 1,500-kilometre highway from Brazil’s densely populated south-central region
76 Robert Wade
into the sparsely populated northwest Amazon. In addition, it was to construct

feeder roads at the frontier end of the highway, rehabilitate existing agricultural
settlements, establish new settlements, provide health-care, and create ecological
and Amerindian reserves. The affected area was the size of Ecuador. Between
1981 and 1983, the Bank approved five loans in support of Polonoroeste,
totalling US$457 million. Well over half went for the highway and feeder roads.
The Bank was the only non-Brazilian source of finance (World Bank 1992).
Polonoroeste is important in the history of the Bank’s environmental work for
two reasons. First, it was conceived in the Bank as an innovation, which was to give
unprecedented attention in the institution to mitigating the adverse effects of a
development project on the environment and on indigenous peoples. In the Bank’s
eyes it was to be a model of comprehensive regional development planning.
Second, and ironically, Polonoroeste became the spearhead for the environ-
mental NGOs’ attack on the Bank. In a crescendo of articles, television
documentaries and hearings before US congressional committees during
1983–87, the Bank’s environmental critics held up Polonoroeste as the Bank’s
biggest and most disastrous involvement in forest colonization in the tropics; the
quintessential example of its wider pursuit of misguided development strategies.
Polonoroeste offered powerful images – of palls of smoke, bulldozed trees, black-
ened stumps – and a saga of victims (immiserized peasants and Amerindians)
and villains (military governments, rapacious loggers, and multilateral banks).
The Ecologist published a special issue called The World Bank: Global Financing of
Impoverishment and Famine, with articles on Polonoroeste.4 Sixty Minutes, the most
widely watched US television newsweekly, featured Polonoroeste in a 1987 docu-
mentary that sharply criticized the World Bank for wasting US taxpayers’
dollars.
Why did the World Bank become involved?

From the beginning some people in the Bank warned that the risks in this project
were too high and that better alternatives for agricultural development existed
elsewhere in the northern half of Brazil. But the Bank decided not to stay away
for several reasons.
The Bank assumed that the Brazilian government would pave the highway,
whether it helped or not. Migration would inevitably increase; the region could
not be walled off. The Bank’s help in financing what the Brazilians wanted – the
highway – would give it leverage in promoting other components that the
government was less interested in – agriculture, forest protection, Amerindian
protection, and health – and thereby turn it into a model of integrated rural
development.
The Bank presented Polonoroeste as a poverty programme. Sizeable numbers
of settlers – would-be small farmers – were already in the area following earlier
waves of migration, but they had been more or less abandoned since the govern-
ment had failed to provide the expected infrastructure and services. Without the
Bank (said the World Bank), the Brazilian government would continue its
mistaken, geometrical-grid settlement practices and do little to make the small

farmers viable. Therefore Bank involvement would help reduce poverty and
reduce the environmental and Amerindian damage.
It was clearly also of importance that Brazil was a large, self-confident
country, hailed as a ‘miracle’ grower in the 1970s. It had a competent bureau-
cracy at the top levels, and it was a big borrower from the Bank and therefore a
most valued customer. The Bank wished to increase lending to an important
borrower at a time when Brazil’s foreign exchange requirements were rapidly
increasing.
The force of these various reasons, especially those having to do with
Polonoroeste as a model for the development of ‘the world’s last land frontier’,
came from the fact that they had a powerful champion in the Bank. This was
Robert Skillings, who had become chief of the Brazil country programmes divi-
sion in 1971 and stayed in that position until late 1982. Market exploitation of
the Amazon was inevitable, he said, the only question was whether it happened
wisely or in the free-for-all anarchy of the American West. The Bank could help
ensure that this global asset was developed wisely.
Loan approval, 1981

In April 1981 the Loan Committee (of the operational vice-presidents) met to
discuss the decision to proceed to negotiations with the Brazilians. This was the
last point in the process that the project could, in practice, be turned back or
modified. But by this time the project had too much momentum behind it for it
to be redesigned. At the end of the meeting, the chairman concluded that ‘this
would remain a high-risk project, but one worth doing’.
The Bank did not go into Polonoroeste inadvertently, ignorant of the dangers.
It was convinced that the dangers could be and would be offset by appropriate
safeguards; and that come what may, the results would inevitably be worse if the
Bank were not involved. Yet the Bank made no serious assessment of the proba-
bility that those ‘adequate safeguards’ would be carried out on the ground.
Performance on the ground

The roadwork raced ahead, whereas everything else lagged far behind. With
most of the funds disbursed for the road building, the Bank had relatively little
leverage left for getting the other things done.
The paved highway and the Bank’s endorsement of the whole project
brought a flood of migrants.5 The population in the project-affected area surged
from an estimated 620,000 in 1982 to 1.6 million in 1988 (World Bank 1992).
The assumptions on which the Polonoroeste development strategy had been
based turned out to be wildly inaccurate. Subsequently, neither the state govern-
ment nor the national government did much to enforce the boundaries of the
Amerindian reserves, or to limit the logging, or to provide the agricultural credit
and the agricultural extension necessary to make the jungle settlements viable.
78 Robert Wade
Deforestation and spontaneous settlement occurred outside the demarcated

areas, helped by the feeder roads.
Brazil’s fiscal crisis and inflation in excess of 100 per cent wreaked havoc on
implementation planning. The problem was especially serious in the health
component. Malaria raged like a monster out of control. Many thousands died.
Suspension of disbursements
At the working levels alarm bells continued to ring. A nine-member mid-term
review mission went out in November 1984 and presented its report in late
February 1985. The report documented at length the many failings.6 Soon after
the mid-term review was presented in March 1985, the decision was made to
suspend disbursements until a ‘Corrective Action Program’ could be agreed
upon and certain specific measures taken for Amerindian protection.
Then came two changes in the larger context. First, the Bank was hit with
intense public criticism over what US and Brazilian environmental groups
were calling the Polonoroeste ‘debacle’. The NGOs were demanding suspen-
sion, and powerful figures in the US Congress were insisting that the United
States cut its contributions to the Bank. Second, Brazil’s first civilian govern-
ment in twenty years had just taken office and accepted the suspension as an
indictment of its predecessors rather than itself. Five months later, in August
1985, when the Brazilian government presented to the Bank an action plan to
deal with the problems, and showed evidence that the settlers had been
removed from the recently invaded Indian reserve, the Bank resumed
disbursements.
After 1985
In the period from 1985 to the effective end of the Polonoroeste project in 1989,
the Brazilian government somewhat strengthened the implementing capacities of
the state agencies, roughly demarcated most of the reserves, and provided some
of the infrastructure of the settlement projects. Gradually the government on the
ground began to make some progress in doing some of the things it had agreed
to do years before.
Yet the OED study found that ‘Polonoroeste appears to have been largely
unable to implement and/or sustain many of its environmental protection
measures or to avoid the continuing invasion of reserve areas by loggers,
prospectors, and spontaneous settlers’ (World Bank 1992: 108). In retrospect,
the outcome could hardly have been different. It was not just that the Bank
and Brazil had few data on such fundamentals as soils and their distribution. It
was, more basically still, that the Bank hardly addressed the question of the
ability and willingness of the federal and territorial agencies to do what the
plans required them to do. The Bank’s desire to lend to Brazil and at the same
time show the world how to conduct rain forest settlement well, coupled with
its general avoidance of political analysis, led the relevant people to make
assumptions about Polonoroeste that the Latin American vice-president

described, looking back, as ‘almost deliberately naive’.7
Pressures for change: the NGO campaign and the US

Treasury’s push for environmental reforms
In May 1987 the Bank’s new president, Barber Conable, announced plans for a
big expansion of environmental capacity, just what the Bank had been saying for
years it did not need (Rich 1994: 125). Undoubtedly the campaign led by US
environmental NGOs was a major factor in driving the Bank to change its ways.
But there were other forces at play as well. The US Congress was one. It had to
approve US contributions to IDA, and could be swayed by lobbyists. The US
Treasury was another. The role of the Treasury helps to explain why the Bank
held off the campaign for four long years.
The NGO campaign, 1983–87

Between 1983 and 1987 more than twenty hearings on the environmental and
social performance of the multilateral banks were held before six sub-committees
of the US Congress. The centre of attention was the World Bank. Congress had
to approve US contributions to the Bank’s lending resources, and decided at this
time to base its approval on some new conditions. Among other conditions, the
US executive director of the Bank would be required to press the Bank’s manage-
ment to undertake stipulated environmental reforms, the implication being that if
the Bank’s management did not act, Congress would look less favourably upon
the next request.
The fact that there had been few actual reports of major environmental
damage in its projects over the previous several decades made the Bank confi-
dent of its existing arrangements. In any case, it had no fora of consultation with
NGOs.8 Direct contact with NGOs seemed to contradict two of the Bank’s
constitutional principles: that it would deal with citizens and legislators of
member governments through the designated representatives of those govern-
ments on the Board of the Bank; and that it would maintain a fiduciary
relationship with member governments, a relationship of confidentiality in
which the responsibility for releasing information pertaining to a borrower lay
with the borrowing government.
First steps, 1983–84

Early in 1983 three NGOs (the Natural Resources Defence Council [NRDC],
the Environmental Policy Institute, and the National Wildlife Federation [NWF])
began to consider the World Bank as a target for an international environment
campaign.
The trio’s basic strategy was to work with environmental and indigenous
rights groups in the United States and in a few other countries having the
80 Robert Wade
largest share of voting rights in the Bank. They would publicize a small
number of large projects against which it would be easy to mobilize opposi-
tion. Using these few projects as levers, they would build pressure on member
governments to move the Bank, through the executive directors, to institute
environmental reforms.
Then they persuaded the chairman of a House committee dealing with inter-
national development issues to hold hearings before going to legislation. The
hearings would generate useful publicity. Referring to the Polonoroeste project in
northwest Brazil, the witnesses argued that had the Bank not helped to finance
the 1,500-kilometre highway, considerably fewer colonists would have come into
the area and the environmental and social damage would have been much less.
In the end, the House sub-committee issued nineteen recommendations, concen-
trating on actions that could be monitored by Congress and the public, in
December 1984. The Treasury agreed with most of the recommendations, and
assigned a full-time staff member in its Office of Multilateral Banks to monitor
the environmental aspects of multilateral bank loan proposals.
Showdown over Polonoroeste, 1984–85

In October 1984, Bruce Rich of the Environmental Defence fund organized the
sending of a letter to President Clausen about Polonoroeste. The letter called on
the Bank to enforce its loan covenants with the Brazilian government by immedi-
ately suspending disbursements. It listed eight specific steps that the Brazilian
government should carry out, and asked how the Bank would ensure that the
steps were taken.
The letter was signed by thirty-two NGOs from eleven countries, including
the presidents of the American and Brazilian anthropological associations; envi-
ronmental groups in the United States, Europe and Brazil; and eleven members
of the West German parliament.9 It was accompanied by extensive research
dossiers on Polonoroeste prepared by Bruce Rich and anthropologist Steve
Schwartzman. The letter and accompanying dossier were featured in a New York
Times article shortly afterward (Eckholm 1984: A17).
The Bank’s letter of reply, cleared by Clausen and by the vice-president for
Latin America but signed by the chief of the Brazil programmes division (the
appropriate person to reply to an outside enquiry about the Bank’s work in
Brazil), was brief and formal. It said, in part:
As you are aware, Polonoroeste is a carefully planned regional development

program, which seeks to stabilize and maximize the economic development
of the region, while minimizing the risks to the regional ecology and
Amerindian populations. We very much share the concerns you have noted
in your letter. We have discussed them in detail with the Brazilian authorities
and are encouraged by those discussions to believe that effective action will
be taken. We recognize, however, that close monitoring will be necessary
and we will therefore continue to follow the situation very closely.10
Outraged, Rich showed the correspondence to Senator Robert W. Kasten Jr.

Senator Kasten was chair of the key Senate Appropriations Sub-committee on
Foreign Operations, and therefore had the power to set the sub-committee’s
agenda and to initiate legislation governing US participation in the Bank. His
position made him, for the Bank, the most powerful senator of the most
powerful member state. When Kasten and his staff saw the Bank’s response to
Rich’s letter, they ‘hit the roof ’. [The Bank’s reply] seemed to confirm their
worst suspicions about the arrogance and lack of accountability of multilateral
institutions’ (Rich 1994: 123).
In January 1985, Senator Kasten sent a letter to Clausen, describing the
Bank’s letter to Rich as ‘at best a brush-off, but frankly, more correctly described
as an insult’.11 Kasten also wrote a letter to Don Regan, Treasury Secretary, and
sent copies of the correspondence to Regan’s designated successor, James Baker.
After many draft replies had been discussed with the US Treasury and the US
executive director, and after Kasten’s office had angrily returned a reply that
proposed a meeting between Kasten and the US executive director, Clausen
invited Kasten to meet with him and his staff directly.12
The meeting, on 22 May 1985, was civil. It was more in the nature of a polit-
ical ballet than a meeting; Kasten and the environmentalists already knew
everything the Bank officials were about to tell them. But the symbolism was
important: Senator Kasten had persuaded the president of the World Bank, as
well as three other top managers whose attendance Kasten had requested, to
meet with him and representatives of several knowledgeable NGOs and explain
to them the current state of the Polonoroeste project. This, to Kasten and the
environmentalists, looked like a breakthrough in accountability to a member
government.
The US Treasury becomes serious and the NGO campaign

intensifies, 1986–87
As 1986 approached, the campaign broadened and intensified. The change of
stance at the Treasury helps to explain why the Bank changed its mind. What
is striking about the first several years of the campaign is how little the Bank
moved in response to all the pressure. For one thing, the top management was
preoccupied with short-term issues of the debt crisis. And it considered that its
Articles of Agreement precluded any direct bargaining-type dealings with
NGOs or national legislatures.13 In addition, the pressure was coming mainly
from the Congress, not from the Treasury, and it was the Treasury, as the
Bank’s official interlocutor, to which the Bank had to give serious attention.
However, it began to be clear in 1986 that the Bank required a capital
increase for it to be able to undertake the expanded role implied by the Baker
Plan, and the Congress had to approve an increase in the US capital contribu-
tion to the IBRD. It was at this point that the Treasury had to take seriously
what the Congress, and Senator Kasten in particular, had been saying about
the Bank’s environmental record. Hence the Treasury put weight behind the
82 Robert Wade
environmentalists’ recommendations. It wanted the Bank to do what was

necessary to diffuse the environmentalists’ criticisms, and so remove the
grounds on which Congress might hold up an IBRD capital increase.
In 1987 Congress was scheduled to approve both an increase in the US
contribution to the IBRD’s capital base and an IDA replenishment (IDA 8).
The environmental NGOs recognized that 1987 would be ‘a crucial year for
the campaign to influence the MDBs’, because ‘considerable opportunity exists
for organizations to influence the direction of foreign assistance’.14
In 1986 the Sierra Club published Bankrolling Disasters, a manual showing
how ordinary citizens could link up with the campaign and influence the multi-
lateral development banks.15 Fifteen thousand copies were distributed to
USAID missions, World Bank executive directors and staff, regional multilat-
eral bank counterparts, government officials, and NGOs throughout the world.
The NGOs scored a significant if partial victory in June 1986, when
Secretary Baker directed the US executive director of the Bank to vote against
an Electric Power Sector Loan to Brazil. The loan was approved. But the US
‘nay’ represented the first time any member of the Bank had voted not to
approve a loan on environmental grounds. By this time the executive directors
of several major Part I countries, such as Canada, the Netherlands, Australia,
the Nordic countries, and the United Kingdom, were also actively pressing for
environmental reforms in the Bank similar to those that the US executive
director had been urging for a long time. But they continued to do so more
quietly than the United States, and were more inclined to accept the Bank’s
argument that its involvement in environmentally damaging projects would
make the projects less bad. Indeed, several of them – and still more the execu-
tive directors from the borrowing countries – were critical of what they saw as
the US government’s double game, of criticizing the Bank on environmental
grounds in order to play to the domestic environmental gallery, while doing
little to hold up the flow of lending.
The World Bank responds, despite opposition

Former US Representative Barber Conable, veteran of twenty years in
Congress, knew when he became president of the World Bank in 1986 that he
had no choice but to defuse the environmental issue, the Bank’s prickliest public
relations problem at the time.
Many of the borrowing governments, however, especially the big and impor-
tant ones like Brazil and India, remained strongly opposed to the Bank’s
assertion of environmental criteria, still considering that this infringed on their
sovereignty over their own natural resources. They deeply resented the US pres-
sure, regarding the US executive director as little more than the mouthpiece of
US NGOs. To whom were those NGOs accountable, they kept asking. By what
right could those US-based NGOs claim to speak for the citizens of their own
countries, as though they had more legitimacy than the governments themselves?
To these questions the US NGOs admitted that they had no right to tell the
governments of developing countries what to do. But they claimed every right to
lobby the US government on what instructions should be given to the US execu-

tive director about how Bank lending resources, which included US tax dollars,
should be used.
The Bank’s shift on the environment, this account suggests, was largely tactical,
a response to the need to reduce the threat to its lending resources. The circum-
stances that made it move were to shape the content of its environmental work.
Institutionalizing ‘environmental protection’, 1987–93

‘The World Bank has been part of the [environmental] problem in the past’, and
it had ‘stumbled’ in Polonoroeste, declared Barber Conable to the World
Resources Institute on 5 May 1987,16 and he went on to promise significant
organizational changes.
The new structure outlined by Conable was soon created. Having established
a complex of in-house environmental champions, the Bank also had to design a
set of procedures by which projects would be environmentally assessed. These
two developments – environmental staffing and environmental assessment proce-
dures – constituted the first serious attempt to move from ‘environment as
exception’ to ‘environment as routine’.
The first press statements announced ‘100 new environmental posts’, but by
the end of 1987 the figure was closer to fifty environmental posts (as compared
with about five in 1986). In this structure the Environment Department was to
be the flagship. Yet from the beginning the department malfunctioned for several
years and was discredited in the rest of the Bank.
The division chiefs of the Environment Department could not agree among
themselves on priorities and territory, and lacked the staff and budgets to imple-
ment both the serious policy work and the operational support being called for.
All the while the NGOs barraged the department with criticism. In the mean-
time, the operational parts of the Bank were wracked by uncertainty over how to
operate the new organizational structure, while being under great pressure to
deliver lending programmes. The last thing they wanted to hear about was new
environmental requirements.
The larger reorganization was partly about cutting staff numbers, and many
people suddenly found themselves on the internal job market, their previous
position gone. They scrambled for somewhere to go. Environment was the only
expanding area. Some who had an environmental qualification or track record
got positions there, as did several anthropologists (since ‘social’ issues of resettle-
ment and tribal concerns were placed under environment, as before 1987). But a
sizeable number of those who ended up in the environment complex had no
training or experience in environmental issues; they went there on cascading
cronyism networks, or in order to get onto other promotion ladders after their
own had been blocked. Over the first two years the environmental complex
experienced a staff shakeout; those who had gone there as a refuge left for jobs
elsewhere, allowing the complex to recruit people with more environmental
experience. At the same time, some of the best people also left, fed up with what
they saw as the Bank’s lack of seriousness.
84 Robert Wade
Meanwhile, the operational departments steered clear to the extent they

could. The department did ‘nothing’ for them, they complained. And when
central staffs were made available for operational support, they tended – it was
said – to be less than competent.17 In short, the first several years after 1987
were a time of lost opportunity in the Bank’s environment work.
Making environmental assessment procedures, 1988–91

The 1984 directive on environmental aspects of projects was vague on all the key
questions of environmental assessments. After 1987 two forces – one external
and one internal – combined to make the Bank establish environmental assess-
ment procedures that matched the procedures already formulated for various
bilateral aid agencies.
The external pressure arose from Bank and US Treasury negotiations regarding
how much the United States would subscribe to the on-going IDA replenishment
negotiations. The internal pressure came from the REDs (Regional Environment
Directors). The 1987 reforms had given REDs review and clearance powers, but
offered no clear guidelines on how those powers were to be used. Three of them
had known each other for a long time and were almost the only people in the Bank
with hands-on experience with environmental assessments as defined by the profes-
sion of environmental assessors. They started work in late 1988, to produce an
Operational Manual Statement – by then rechristened Operational Directive (OD)
– which would set out the procedures and conditions of use of EAs throughout the
Bank. The OD format would make them as close to obligatory as any Bank proce-
dures. The responses from the operating levels of the Bank were anything but
enthusiastic.
The clauses that attracted the most criticism were those for consultation and
project classification. The consultation clause in the May 1989 version said:
If screening determines that an EA is required, a ‘scoping session’ is

normally conducted to identify the key environmental issues to be analysed
in the EA report. … It is a forum of selected knowledgeable persons from
national, municipal, and local governments; non-governmental organiza-
tions (NGOs); institutions of higher learning; and affected groups.
(paragraph 14)
This caused a firestorm of criticism across the Bank. Many people said that it
entered ‘political’ territory that the Bank had no business to be in.
When the EA draft reached the President’s Council in late August 1989,
another hot issue came up. When should the EA be released to the executive
directors, and to others? Senior Vice-President Stern reported that US Treasury
Secretary Nicholas F. Brady had recently sent a letter to the Bank asking for
substantial advance notice – for the EA to be delivered to the US executive
director well before the project came to the Board. Stern also reported that
NGOs were pressing hard for the EA to be disclosed long before the project
design was set.
Some twenty-six drafts later, the final OD was ready by the time of the
Annual Meetings of 1989.18 The vice-president for central operations, the
director of the Environment Department, and members of the writing team
gave a presentation to an invited audience of some 300 government officials.
They later did the same at a meeting of a hundred or more NGO representa-
tives and others.
The NGOs were disgruntled, however, because they had not been consulted at
any point in the drafting of the OD, and for reasons to do with the Narmada
campaign (explained later in this chapter) were especially powerful at this time. In
response, the Bank committed itself to an early revision to take account of NGO
reactions. The revised version, OD 4.01, October 1991, said: ‘The purpose of EA
is to ensure that the development options under consideration are environmentally
sound and sustainable.’ This made clearer than had the earlier version that
‘sustainability’ was not a value to be traded off in an economic analysis. Rather, it
implied that all the options under consideration should meet sustainability criteria.
By the late 1980s the Bank came under a second wave of attack for its environ-
mental and social record, this time mounted by an international coalition of NGOs
and eventually joined by several “rich countries” governments. What sparked this
second attack were the Narmada projects in northwest India. This time the Bank
was pressured to go further in integrating environmental and social criteria into its
lending and advice, in the direction of the ‘environmental management’ paradigm.
Pressures for change: the Narmada project in India

The Narmada Valley Project constitutes a basin-wide, interstate development
scheme to harness the Narmada River, one of India’s last ‘unexploited’
resources, for hydropower and irrigation. The reservoir of the first of the big
dams, Sardar Sarovar, would be 200 kilometres long and displace some 40,000
households. The canal, 100 metres across the water at the head, would be one of
the biggest in the world. The canal network would extend for 75,000 kilometres
and irrigate almost two million hectares of arid land. Its construction would
remove some portion of the land of 68,000 households.
In response to years of concerted outside pressure, in 1993 the Bank and the
government of India cancelled the Bank’s disbursements for Sardar Sarovar. This
was the first time the Bank had taken such a step anywhere in the world on envi-
ronmental or social grounds (as distinct from financial or procurement grounds).
Resettlement and the environment

Not until 1983, as Sardar Sarovar was being appraised, did the Bank’s sociologist
and resettlement champion, Michael Cernea, discover that the appraisal
mission’s terms of reference contained no mention of resettlement. So he hired a
well known resettlement expert, Thayer Scudder, to investigate the resettlement
86 Robert Wade
situation. Scudder was ‘appalled’ by what he found.19 Nothing had been done to
inform villagers about resettlement options and rehabilitation packages.
In 1987 a resettlement mission went out to see what progress had been made
in the meantime. It found that those villagers who had already been moved to
make way for the dam were still languishing in resettlement villages on sterile
land without even rudimentary infrastructure. On its return the mission recom-
mended that the Bank threaten India with cancellation for non-compliance with
the resettlement agreement.20
At the Board approval meeting in 1985, only one executive director worried
about potential environmental problems. The staff replied, ‘although a full
environmental impact assessment had not been completed, a comprehensive first-
stage assessment had been conducted by the University of Baroda and then
examined by members of the World Bank appraisal team’. This ‘comprehen-
sive first-stage assessment’ was a short, general document dating from the early
1980s, which could not remotely qualify as an environmental assessment. By
describing it as ‘first-stage’ the staff covered themselves; and by reporting only
the finding that there were no endangered species in the area, the staff gave
the impression that the environmental situation was better than it was.
By 1990 everyone was at everyone else’s throat. The India Department
blamed the Asia RED, the environment people blamed the project people, Bank
staff blamed the Indians, the central government blamed the states, the states
blamed the central government, and everyone blamed the Bank.
External pressure
Meanwhile, a local NGO had come to prominence in the Narmada Valley, later
called the Narmada Bachao Andolan (NBA), translated as Save the Narmada
Movement. The NBA by 1987 had linked up with the US-based Environmental
Defence Fund (EDF). There, a new recruit, Lori Udall, took up the Narmada cause
full-time, encouraged by EDF’s seasoned Bank campaigner, Bruce Rich. Instead of
pushing for better resettlement it launched a ‘Stop the Dam’ campaign. To many
international NGOs, Stop the Dam was more attractive than Better Resettlement.
Udall coordinated the international campaign in the period from 1988 to
1992. First, she identified groups within the more important Part I countries that
might support an anti-Narmada/anti-Bank campaign. Second, she prepared
menus of actions they might take in the circumstances of their own countries:
parliamentary or congressional hearings, public fora, press conferences, lobbying
key officials, and letter-writing campaigns. She especially encouraged them to
contact their country’s executive director and to go to legislators. Third, she
prepared information packs for them, drawing on materials sent by NBA and
other Indian activists.
In 1989 the US-based NGOs in the campaign persuaded a congressional sub-
committee to hold hearings specifically on Narmada. These hearings mark a
watershed in the international criticism of the Bank. Thereafter the interna-
tional anti-Narmada/anti-Bank campaign took off.
The independent review

World Bank President Conable, in the waning months of his presidency, was
growing desperate; he needed someone fast. With support from Evelyn Herfkins
(the Dutch executive director) and other interested executive directors, he
approached his former congressional colleague, Bradford Morse, who since
leaving the US Congress had been head of the United Nations Development
Programme (UNDP). In June 1991 Conable announced that an independent
review panel would be established and headed by Morse.
Ten months later, on 18 June 1992, the panel issued a 363-page report.21
The report concluded, first, that the Bank had been seriously out of compliance
with its own directives on resettlement and on environmental analysis of
projects; second, that ‘there is good reason to believe that the project will not
perform as planned’, that is, perform in the hydrological sense of getting the
water to the expected areas; third, that adequate resettlement was unlikely to
occur on the ground ‘under prevailing circumstances’, because ‘a further appli-
cation of the same [incremental] strategy, albeit in a more determined or
aggressive fashion, would fail’. Finally, it recommended that the Bank ‘step
back’ from the project. Essentially, it confirmed much of what the NGO
campaign had been saying.
The decision to continue, and then to cancel

In July 1992 the Bank sent a large (fourteen-person) mission to review the status
of the Sardar Sarovar project, with the implicit goal of assessing whether the
review was right.22 None of the mission members, including those resettlement
experts who had not hesitated to criticize the Bank’s performance, wanted
cancellation, because they were convinced that without the Bank being involved,
resettlement and environmental protection would be worse.
In September 1992 the Bank presented to the Board a document titled
‘Sardar Sarovar Projects, Review of Current Status and Next Steps’.
In October the chairman and deputy chairman of the review, Bradford
Morse and Thomas Berger, wrote to the president of the Bank saying that the
Bank’s reply, ‘ignores or misrepresents the main findings of our Review. … [W]e
do want to ensure that the senior decision-makers at the Bank are not left with
an account of our findings that is at variance with what we wrote.’23 Review
members subsequently flew to Washington to meet with the Board. Bank staff
present at the meeting remember it for the sheer vindictiveness of the executive
directors. The Dutch executive director, who had taken a coordinating role for
the project within the Board and between the Board and the Bank, reminded the
meeting that the Board had asked for an independent review because it felt it
could not trust Bank management. The Austrian executive director criticized
Bank management for its strong-arm lobbying of the executive directors to keep
the project going. The US executive director, Patrick Coady, accused manage-
ment of a ‘cover-up’, noting, ‘what is at stake is the credibility of the Board’
(Rich 1994: 301).
88 Robert Wade
The Bank’s management said: ‘A decision by the Bank not to get involved
could well mean that the project in question will still proceed but under much
less favourable circumstances’.24 It did not say, though this was in its mind, that
cancellation would have severe consequences for the Bank’s reputation as an
infrastructure lender in India and elsewhere.
At the Board meeting a prominent Part I country executive director asked the
key question: had the ‘relevant authorities’ agreed to the benchmarks (meaning,
had the state governments agreed)? The management said yes. On the strength
of this assurance, the executive director voted with the Part II countries, tipping
the balance in favour of continuing subject to review against benchmarks six
months later. The majority ‘wished to give the benefit of the doubt to the new
Government of India [at the federal level] and to acknowledge the recent efforts
made by the Indian authorities’.25
At the end of March 1993, the Board was scheduled to decide whether to
continue. The South Asia vice-president, Joseph Wood, who had resisted suspen-
sion or cancellation since taking charge in 1991, became persuaded there was no
alternative to cancellation. The government of India and the government of
Gujarat attitude was: ‘Damn the NGOs, we are not going to submit to cry-
babies, we will continue to build the dam.’ They did not wish to accommodate
the Bank’s attempts to respond to world outrage. In the end, President Preston
informed the prime minister that Narmada was jeopardizing IDA, which would
hurt India. The vice-president for South Asia told the Indian government:
‘Either we cancel or you tell us you will not submit requests for disbursements.’
A few days before the Board meeting, the government of India announced
that it would not ask the Bank for more disbursements. The central government
was not unhappy to cancel. The project was generating too many headaches,
and the benefits of Bank involvement went largely to Gujarat, not to the centre.
In private, Indian officials said that what the Bank had been doing was ‘not in
keeping with the country’s self-respect’ (National Herald 1993). The NBA then
succeeded in getting the Supreme Court to halt dam construction at the begin-
ning of 1995, until resettlement was carried out in line with India’s and the
Bank’s policies.
Why Narmada?
Narmada became a focal point for NGO activity because it had several charac-
teristics that lent itself to the NGOs’ general opposition to the World Bank: it
involved the forced displacement of large numbers of people, many of whom
could be presented as sympathy-deserving ‘tribals’; forced relocation could
support a radical campaign to stop the dam; local opposition was well organized,
led by a charismatic figure (Patkar); the international campaign benefited from
unusually energetic and tenacious organizers (in particular Udall and EDF);
some Bank staff members and Bank consultants were severe critics of the way
the project was being implemented, and could help the external critics with
information; and the local opposition to Narmada began to reach a crescendo
around 1986, just as Polonoroeste was losing its appeal to the NGOs. Finally,
location in India also helped, because international NGOs had good access to
English-language information and because India’s democratic polity and free
press allowed opposition.
What did make Narmada unusual was its timing, which put it in a set of
‘hinge’ projects. It was prepared, appraised, and approved at about the same
time that the Bank introduced quite new directives on ‘non-economic’ criteria –
resettlement and environment. The operational people, including South Asia
Vice-President David Hopper, stoutly resisted these ‘non-economic’ criteria and
directives inside the Bank. Their resistance, combined with ambiguity about the
status of ‘directives’ (as analogous to national laws or as guidelines for what
would be nice to achieve), allowed the project people to continue to prepare the
project as they had prepared projects before the resettlement and environmental
directives were introduced.
From ‘environmental protection’ to ‘environmental

management’
Around 1992 and 1993 the more comprehensive ideas of the ‘environmental
management’ paradigm began to take hold at senior management and opera-
tional levels.
The Global Environmental Facility helped promote conversion. From 1989 to
late 1990 the Bank was involved in negotiating a pilot phase, which was
approved for a period of three years with funds of $1.3 billion, pledged by
participating countries (Kjørven 1992; Sjöberg 1994). The preparations for the
Rio Summit of 1992 also helped to ‘seed’ the environmental idea inside the
Bank by providing it with the opportunity to demonstrate world leadership in
environment–development matters and to refurbish its battered image. By this
time, too, the environmental complex was well established and pushing to
expand its mandate.
There is no doubt that ‘the environment’ now has greater legitimacy than it
did in, say, 1991. As a prominent Ban k research economist put it: ‘You can’t write
anything about development these days without mentioning the environment.’26
The publication of Development and the Environment, the title of the World
Development Report 1992, was a milestone in this shift. The report helped move the
process forward in several ways. First, it presented environmental issues in a
language that economists (inside and outside the Bank) could understand, as
economic problems entailing costs and benefits. Second, it imparted a strong
bias toward thinking that the scope for policies that benefited growth, poverty
reduction and environmental protection simultaneously was large, encouraging
economists to hunt out such opportunities in their own particular countries.
Third, it redirected attention toward the ‘brown’ agenda, i.e. much of the envi-
ronment debate in the development context had been about green issues, in
response to the dominant concerns of northern NGOs. Fourth, the report was
written under the direction of a well–respected Bank economist, Andrew Steer.
90 Robert Wade
He had no previous involvement with environmental issues, and his conversion

helped other economists change their minds.
Integrating environmental sustainability in macro and

sector work
By 1993 Bank economists sympathetic to an environmental agenda had come to
agree that much greater environmental improvements could be achieved by inte-
grating environmental criteria into the Bank’s policy work at the country level
(into ‘economic and sector work’, in Bank parlance) than by improving indi-
vidual projects. Yet this integration, up to the mid-1990s, was noticeable by its
absence.
It is true that National Environmental Action Plans (NEAPS) had been or
were in the process of being prepared for Bank borrowers, initially for IDA
countries as a condition of the IDA 9 negotiations of the late 1980s but contin-
uing for non-IDA countries, too (World Bank 1990: 304). But at least up to the
mid-1990s the plans were often ‘ritualistic and second-rate’, in the words of the
director of the Environment Department.27
Even the many high-quality studies produced by the Bank on various aspects
of development–environment integration mean less than they appear to. A high
proportion of them are done not by staff members but by consultants, and
therefore they expand the Bank’s intellectual capital by less than would be the
case if staff had written them.
In reviewing the Bank’s efforts to integrate environmental considerations, one
finds that the organization has handled them best when it has organized environ-
ment as a separate sector, alongside agriculture, energy, forestry, and so on – a
sector bounded, moreover, by national borders. These are fully consistent with the
Bank’s long-established mode of organization: they can be given to a task
manager located in a country department and handled just like any other project.
But conflicts of interest and difficulties of budgeting arise when environment is
organized cross-sectorally, as a perspective to be injected into all Bank work.
The governance reforms

In October 1992, just as the Board voted to continue Sardar Sarovar for another
six months, negotiations for the tenth replenishment of IDA (for 1993–96) were
entering their final phase. The NGOs that had been most active in opposing
Narmada swung into a campaign to obtain two fundamental accountability
reforms. They wanted a radical revision in the Bank’s information policy so as to
make information about projects more freely available. And they wanted an
independent appeal panel that would give directly affected people access to a
body empowered to investigate complaints that the Bank was violating its policy
procedures and loan agreements. The NGOs announced that they would oppose
pledges to IDA 10 by the United States and other governments unless these
reforms were carried out. In testimony before the US Congress in spring 1993,
they proposed that the Congress redirect its IDA money to other organizations
that were more accountable and democratic than the Bank, should it not carry
out the two reforms by June 1994 (Udall 1998).28
The accountability campaign focused on the sub-committee of the US
Congress in charge of authorizing US contributions to IDA. The chairman of the
sub-committee, Representative Barney Frank, informed Ernest Stern in private
that the Bank had a simple choice: either it adopted an acceptable information
policy and independent appeals panel, or it got no US money for IDA 10. The
Bank took the threat seriously. It secretly sent drafts of the new information policy
and a resolution creating an independent ‘inspection panel’ to Frank and his sub-
committee for comments, before presenting them formally to the Board.
The new information policy approved by the Board in August 1993 fell short
of what the NGOs and Frank were demanding, though it also represented a
substantial change from the old policy.29 The Board also approved a resolution
creating an independent inspection panel in September 1993 (World Bank 1993;
Shihata 1994). This, too, fell well short of what the NGOs had envisioned. Its
basic principles of operation as approved by the Board gave it much less inde-
pendence than had the independent review for Sardar Sarovar. Nevertheless, the
creation of the inspection panel did represent a major departure from previous
practice, and its existence owed much to the precedent of the independent
review for Sardar Sarovar.
Critics of the panel, including many Bank managers, also said that the panel
discouraged staff from seeking imaginative and risky solutions and caused
management to steer away from projects that were inherently difficult to ‘panel-
proof ’, such as dams. It imparted a legalistic thrust to Bank work, eclipsing
substance (as in the injunction: ‘Make your projects panel-proof ’), and strength-
ening an existing tendency toward ‘OD absolutism’, with ODs being interpreted
by outsiders as legally binding, like the laws of nation-states. As the drive to
codify procedures intensified in the late 1980s and early 1990s, task managers
complained of being ‘OD’ed [overdosed] on ODs’. A study of ODs covering
Bank projects showed that as of 1992 they specified a total of about 200 sepa-
rate tasks for task managers to carry out, and ODs then in the pipeline were
expected to double that number.30
Conclusion
The history of the Bank’s attempts to come to grips with the ‘environment’ can
be read as a great battle over values, attitudes and images. As in religious wars,
the (environmental) facts have often ended up as relatively unimportant details
compared with the symbols and postures and the struggle for power. Yet there are
no ‘objective’ standards of value and no consensus about causal relationships.
In principle, all Bank work should now be assessed for its effects on economic
growth, poverty reduction and environmental sustainability. The change has
consisted of a paradigmatic shift from ‘frontier economics’ before 1987, to ‘envi-
ronmental protection’ up to the early 1990s, and on to the more comprehensive
92 Robert Wade
‘environmental management’ thereafter. Throughout, it has been accompanied

by changes in staffing, organization and procedures.
The process by which one paradigm shifted to another was anything but a
deliberative response to new knowledge and new opportunities. It was more akin
to the grinding of tectonic plates, as people of radically different worldviews
were forced by the pressures of environmental disruption and the political
responses to deal with one another again and again. Or perhaps it was more
akin to learning through angst, as Bank task managers, Bank senior managers,
Bank economists, Bank environmental specialists, borrowing-government offi-
cials, US NGO representatives, borrowing-country NGO representatives,
villagers, and city dwellers tried in overlapping fora to find a common language
and common ground, all calling upon powerful normative reasons for doing
what they wished to do and not doing what others wished to do.
The new environmental values were championed by a spiralling international
concert of environmental NGOs and agencies of some Part I governments.
They were for the most part resisted by developing-country governments and by
many economists and engineers working on development issues. The new envi-
ronmental values, said the resisters, were based on criteria – such as ‘ecosystem
functioning’, ‘ecosystem damage’, and (especially) ‘environmental sustainability’
– that had no clear empirical referents. Yet these kinds of fuzzy notions were
being used to pose fundamental challenges to professional identities (‘we only
deal with hard numbers’), to question the role of ‘experts’ in relation to citizens,
and to disparage the very concept of development as we know it.
The Bank moved to embrace the self-consciously named environment in 1987
in large part because the NGO campaign and the US Treasury made the costs
of not moving too high. In this respect, what happened in the environment field
is similar to what has happened elsewhere when the Bank has changed its mind:
in most cases, the Bank has not moved without outside pressure from the major
donors/owners of the Bank or from NGOs (Prestre 1989). No doubt the Bank
would eventually have moved on the environment anyway because of the larger
tide of ideas, despite the legacy of more than twenty years of internal resistance.
But the fact that the other multilateral development banks made virtually no
moves to integrate environmental considerations until well into the 1990s does
support the argument that the NGO campaign was crucial. The NGOs paid
much less attention to the other multilateral banks than to the World Bank, not
because they thought it worse than the others but because it had a much higher
political profile.
By 1992–93, however, the legitimacy of ‘environment’ inside the Bank began
to turn strongly positive. Not only in World Development Report 1992 but also in all
its publications, it began to promote itself, evangelically, as a champion of envi-
ronmental sustainability. In principle, ‘environmental sustainability’ imparts a
still more distinctive and comprehensive set of objectives to the Bank’s work. But
the integration of these new concerns has been severely constrained by the
Bank’s established organization, incentives and knowledge.
A question should be raised concerning the Bank’s environmental (and reset-
tlement) standards. Do these standards create such a cost burden that they signif-
icantly impair the Bank’s ability to compete against other sources of funds that
are less stringent (the Japan Import–Export Bank or the regional multilateral
banks, for example)? Should the standards be varied by country groupings rather
than made uniform for all? The Bank’s environmental critics have tended to
forget that it is, at base, a lending institution; its ability to carry out its develop-
ment-within-the-limits-of-sustainability function rests on its ability to lend, and
hence on finding governments willing to pay its prices.
The Bank has moved from Old Testament harshness (‘environment versus
growth’) to New Testament reconciliation (‘environmentally sustainable develop-
ment’). But it has yet to engage in an open internal debate about what it should
be doing in the environment field, a debate in which the sort of questions raised
in this chapter can be tackled – and disagreements honestly aired – with a view
to finding answers that command some consensus and are operationally mean-
ingful. This would be difficult, however, without reforming the command and
control style of management and introducing ways to evaluate staff by the effec-
tiveness of their projects more than by their reliability in moving them to the
Board. Failing some change in the system of internal incentives, there is a
danger that New Testament reconciliation may remain at the level of images
and values and bring little improvement to what happens on the ground.
Notes
1 The following draws on Colby (1989).
2 Mahbub ul Haq had been secretary for planning in Pakistan. At this time he had just
joined the Bank as a senior economic adviser, recruited directly by McNamara.
3 McNamara, interview with the author, 20 February 1995.
4 See The Ecologist 15 (1–2): 1995.
5 The World Bank did not make any estimates of the effects of the highway on migra-
tion, nor did it work out alternative scenarios based on different migration
assumptions.
6 World Bank, mid-term review, internal memorandum of 25 February 1985, cited in
World Bank (1992).
7 David Knox, who became vice-president for Latin America in time for the mid-term
review of Polonoroeste, interview with the author, 15 May 1995.
8 This is not literally true. The Bank had long had contact with foundations such as
Ford and Rockefeller, drawing on their expertise in policy making and in particular
projects. It also established an NGO–World Bank Committee in 1982. It was window
dressing, without significance, until the late 1980s, when it began to include southern
NGOs and more radical northern ones (such as Development Gap).
9 The Green Party had been active in mobilizing opposition to Polonoroeste in
Germany.
10 Robert Gonzalez Cofino, chief, Brazil Division, to Bruce Rich, NRDC, 7 November
1984.
11 Letter, Senator Robert Kasten to A.W. Clausen, 24 January 1985.
12 A.W. Clausen to Senator Robert Kasten, 1 March 1985.
13 IBRD, Articles of Agreement, Article III, Section 2.
14 See Interaction Newsletter (February 1986) published by the Global Tomorrow Coalition.
15 Written by Bruce Rich and Steve Swartzman.
94 Robert Wade
16 His admission upset members of the Polonoroeste project team, who continued to
think that the project was much better than it would have been without the Bank.
17 This was a common perception, yet operational staff would also agree that quite a
number of individuals in the department, name by name, were exceptionally able.
18 ‘Environmental Assessments’ is formally presented as ‘Annex A’ to OD 4.00; the OD
itself was then unwritten.
19 Thayer Scudder, interview with the author, 3 November 1995.
20 Formally, the recommendation was for suspension followed by cancellation, since
Bank procedures require that suspension precede cancellation.
21 This was four days after the World Bank rose from Rio as the key agency to implement
‘Agenda 21’, an informal intergovernmental agreement on global environmental
priorities and actions. A draft had been discussed over two days in May by a group of
eleven staff and three panel members.
22 Known as the Cox Mission, after its leader, Pamela Cox, a member of the India
Department who had not previously worked on Narmada.
23 Bradford Morse and Thomas Berger to Lewis Preston, 13 October 1992.
24 The quotation comes from the first draft of the Bank’s management’s response to the
independent review, dated 23 June 1992, p. 12.
25 Chairman’s summary, ‘India: Sardar Sarovar Projects’, executive directors’ meeting,
23 October 1992.
26 Lant Pritchett, interview with the author, 10 December 1996.
27 Andrew Steer, interview with the author, 28 October 1994.
28 See also the testimony of Barbara Bramble on behalf of the National Wildlife
Federation, and the testimony of Lori Udall on behalf of Environmental Defence
Fund, before the Sub-committee on International Development, Trade, Finance and
Monetary Policy on 5 May 1993.
29 See ‘Bank Procedures, Disclosure of Operational Information’, BP 17.50, September
1993.
30 Critics of the panel also say that it is a vehicle for a small number of Washington-
based NGOs to gain funding and prominence by initiating and preparing cases to go
to the panel. The Centre for International Environmental Law, linked to the
American University in Washington DC, has been especially active in this way.
7 Sustainable development
and the World Trade
Organization
Morten Bøås and Jonas Vevatne
Introduction
The World Trade Organization (WTO) was established on 1 January 1995, as
part of the final agreements of the Uruguay Round negotiations. The establish-
ment of the WTO is one of the most significant moments in the recent history of
multilateral institutions, because ‘its establishment provides a sister institution for
the Bretton Woods pairing of the International Monetary Fund (IMF) and the
World Bank some 50 years after their creation’ (O’Brien et al. 2000: 68).1 In the
predecessor to WTO, the General Agreement on Tariffs and Trade (GATT), no
explicit reference was made to the environment.2 GATT’s first experience with
environmental issues came when the GATT Secretariat was asked to report to the
UN Conference on the Human Environment (UNCHE) in Stockholm in 1972. GATT’s
report, International Pollution Control and International Trade, was a strong reflection of
the dominant free-trade paradigm in GATT (Nordström and Vaughan 1999).
The basis of GATT’s approach to trade and environment was that trade had to
be protected from environmental measures and not the other way around (Lund-
Thomsen 1999: 51). As a follow-up to this report, it was decided that GATT
should establish a Working Group on Environmental Measures and International Trade
(EMIT). This group was supposed to review all kinds of trade-related aspects of
measures for pollution abatement and preservation of the human environment
(Nordström and Vaughan 1999). However, this group existed only on paper. The
GATT did not adopt the notion of environment in its work and EMIT did not
meet until November 1991. In fact, in almost all other comparable multilateral
institutions, the idea of sustainable development was already firmly established by
the time the idea was finally also taken up by GATT/WTO.
Already in the 1980s, the World Bank and other multilateral institutions were
strongly challenged on environmental grounds by international environmental
NGOs (see Chapter 6). GATT, however, did not receive much attention from
these organizations. GATT was therefore able to continue the Uruguay Round
without making any reference to sustainable development in the negotiations.3
The reason for this, we suggest, was mainly the low level of public awareness of
both GATT and the environmental impact of international trade. The low level
of public attention and the non-existence of formal relations between GATT
96 Morten Bøås and Jonas Vevatne
and civil society organizations left GATT out of the public eye, and, therefore,
there was hardly any pressure at all on GATT to address environmental issues.
The traditional, technical and juridical approach to international trade (law)
could therefore prevail. However, in the early 1990s GATT’s lack of concern for
environmental issues came under fire from two sides. The European Free Trade
Area (EFTA) countries, and in particular the Nordic countries, started a process
at the Brussels Ministerial Meeting in December 1990 with the aim of bringing
the work of the World Commission on Environment and Development (WCED)
into GATT; and in the United States, the outcome of the Tuna–Dolphin
Dispute between the United States and Mexico raised public awareness of both
the trade–environment nexus in general, and in particular about the position
and role of GATT within this nexus.4
The objective of this chapter is thus to explore GATT and WTO’s encounter
with the environment and sustainable development. More precisely, the major
task is to explain why it took so long before GATT/WTO adopted the idea of
sustainable development. In order to accomplish this task, we will build our
exploration around a package of assumptions presented below. These will be
analysed in the remaining parts of this chapter.
The argument
Our first assumption is that there are very few multilateral institutions in which
the neoliberal orthodoxy is more dominant than in GATT/WTO. Our argu-
ment is that this has made it difficult for the organization to adjust to
perspectives that potentially are different/diverging. The WTO Secretariat is not
only strongly influenced by neoliberalism; it also adopts a highly technical
approach to international trade. Our point is that new ideas do not enter an
institutional vacuum. ‘They are inserted into a political space already occupied
by historically formed ideologies. Whether or not consolidation occurs often
depends on the degree to which the new model fits with existing ideologies of
important economic and social groups’ (Sikkink 1991: 2).
This implies that the meaning of a new idea is derived largely from the polit-
ical and ideological context of the institution it is absorbed by. We define the
institutional identity of WTO staff members in terms of neoliberalism and tech-
nicality, and argue that staff members’ institutional identity and loyalty was
strengthened when they suddenly (and for them rather surprisingly) were
confronted with strong criticism from the NGOs. The environmental criticism of
the NGOs challenged the very foundation of WTO, namely its free trade theory;
and when confronted with this criticism, staff members closed ranks around the
WTO and its core ideas.
WTO inherited from GATT not only the dominance of neoliberalism and a
technical approach to international trade, but also a tradition of secrecy and lack
of transparency. GATT/WTO’s organizational routines and procedures for
formal relations with civil society are therefore not much developed, and staff
members can isolate themselves from new impulses and competing worldviews
Sustainable development and the WTO 97
and perspectives. This may help to explain the shock felt by WTO staff
members when they witnessed the events in Seattle in 1999.
These three assumptions constitute the major basis for the following analysis
of sustainable development and WTO. Before we turn to these tasks, it is neces-
sary to briefly revisit the events that led to the inclusion of this idea in the
Marrakech Declaration that established the WTO.
The road to Marrakech

Influenced by WCED’s report, the EFTA countries worked hard to include
sustainable development on the agenda at the GATT Ministerial Meeting in
Brussels in December 1990. Their proposal was not enthusiastically received,
and in particular, Brazil and India ‘strenuously fought the GATT efforts to rein-
vigorate EMIT’ (Esty 1994: 181). In the end, however, it was accepted that
sustainable development was an issue for debate within the framework of GATT.
The main reason for this was probably that the UN Conference on Environment
and Development (UNCED) to be held in Rio in 1992 was already under prepa-
ration, and too outspoken opposition to sustainable development by GATT
could entail considerable political costs. GATT had also been asked by the UN
to report to UNCED on the trade–environment nexus (see GATT 1992). This
task was delegated to EMIT, which then met for the first time ever in 1991.
Nonetheless, EMIT had very little influence on the Uruguay Round.
This first attempt to place environmental issues and sustainable development
on GATT’s agenda was soon followed by much harder criticism from the envi-
ronmental movement.
GATT’s response to its critics in the environmental movement was perceived as
arrogant and it led to a long-lasting hostile relationship between GATT and the
NGOs. Instead of trying to deal with criticism in an open and transparent manner,
GATT chose the approach of secrecy. Panel reports and other documents were
stamped ‘restricted’ and relations between GATT staff and NGOs were generally
actively discouraged (see Esty 1994). The consequence was that the majority in the
environmental movement felt that it was impossible to have a fruitful dialogue, and
the NGOs chose to make their criticism even more vocal. The increased strength of
NGO criticism, however, seems only to have reinforced the institutional identity
and loyalty of staff members to the organization’s foundation: free trade theory.
The hostile relationship that developed was also strengthened by the lack of organi-
zational procedures for formal relations between GATT and civil society
organizations. GATT, which traditionally had been a closed and secret institution
with minimal contact with NGOs/non-members, was suddenly strongly criticized
by radical environmentalists. This was a new and frightening experience for most
staff members because originally GATT was organized in a manner that was
supposed to insulate the organization and its staff from political pressure from
particular interest groups (Esty 1994: 53). Until the 1990s GATT had been very
successful in this respect, in fact so successful that the organization had ignored
important changes that it should have observed and absorbed.
The environmental NGOs were instrumental in the last stages of the Uruguay
Round. The United States in particular was pressured by strong national environ-
mental NGOs. The result was that the United States demanded that a clear
reference to sustainable development be made and that a committee on trade and
environment be established. If not, the US argued that the strong domestic envi-
ronmental opposition that the government was faced with would make it
impossible for it to secure a majority in Congress for the ratification of the Uruguay
Round Agreement. From the last negotiation meeting in December 1993 to April
1994, when the agreement was signed in Marrakech, the United States prepared
the ground for a separate statement on trade and environment and for a direct
reference to sustainable development in the preamble of the agreement that estab-
lished the WTO. In the Final Act of the Uruguay Round (April 1994) sustainable
development was therefore included in the rules of the international trade regime
through the so-called Marrakech Ministerial Decision on Trade and Environment,
and at the Marrakech Ministerial Meeting a reference to sustainable development
was agreed upon and included in the preamble of the new organization:
allowing for the optimal use of the world’s resources in accordance with the
objective of sustainable development, seeking both to protect and preserve
the environment and to enhance the means for doing so consistent with [the
parties’] respective needs and concerns at different levels of economic devel-
opment.
(WTO 1994)
Nonetheless, the concept ‘sustainable development’ remained undefined by

the WTO, and the preamble contains only a vague formulation that refers to the
Rio Declaration on Environment and Development. WTO’s understanding of
sustainable development differs significantly from WCED’s definition and inter-
pretation, which emphasized solidarity both within and between generations. This
is an aspect that WTO documents are not concerned about. What these docu-
ments tend to underscore is rather that with the correct policies (neoliberal) the
linkages between trade and environment can be mutually beneficial. ‘The objec-
tives of an open and fair multilateral trade system and sustainable development
are not exclusionary’ (St.prp. nr. 65 1993/94: attachment 738).5 One interpreta-
tion of WTO’s approach to the idea of sustainable development is therefore in
accordance with what Jacobson (1995) calls ‘consensual beliefs’. In WTO,
sustainable development is implicitly defined as a consensual belief, used to
shape the legitimate ends of economic activity.
WTO and neoliberalism

The creation of WTO can be seen as a conscious attempt to establish a strong
global regulatory framework in support of increased trade liberalization. The
architects of the post-World War II economic order interpreted international
non-cooperation on trade as a function of domestic political pressures. GATT
was therefore set up as a government-to-government contract anchored in

support for freer trade (Esty 1994). By embedding the principles of liberal trade
theory in an international regime, the individuals and governments behind the
creation of GATT not only built an institutional mechanism for the supposed
reduction of trade conflict among member states, they also heightened their
commitment to liberal trade theory to almost a constitutional level. The conse-
quence was a clear limitation on the power of governments to give in to the
pleadings of various national interest groups and other social movements. In
moving free trade principles to a higher place of authority, a buffer was
constructed not only against protectionist pressures, but also against most other
attempts at reform of the international trade regime. In order for new ideas to
be incorporated into the existing trade regime as embodied by WTO, the idea in
question must either be in accordance with liberal trade theory or it must be
possible to adapt or distort the idea in question into accordance with liberal
trade theory.
One way to approach the WTO is therefore to view it not only as a legal
instrument for the promotion of free trade (O’Brien et al. 2000), but also as a
bastion of a neoliberal worldview. According to the WTO, free trade and the
abolishment of all kinds of trade barriers will promote economic growth, not
only among the rich industrial countries, but worldwide. And according to the
neoliberal economic paradigm, trade liberalization will encourage more efficient
use of resources, the adoption and diffusion of cleaner technologies, higher
productivity, and increased income levels: developments that the WTO see as a
precondition for a cleaner environment. The WTO thesis is therefore that trade
liberalization will enable less developed countries both to tackle the poverty
problem and their widespread environmental degradation. This kind of
reasoning makes it possible for liberal economists and free traders to see trade
liberalization and environmental protection as compatible.
According to the neoliberal view of WTO, unsustainable economic growth is
the consequence of market failure and the inability of governments to engage in
adequate environmental pricing. This means that any trade-related environment
measures (TREMs) will only make things worse because they will interfere with
the free flow of goods, and thereby lead to less efficient (i.e. environmentally
harmful) resource allocation. It is WTO’s ‘consensual belief ’ that restrictions on
trade are not only inadequate but also positively dangerous, because under the
cloak of sustainable development lies the troll of protectionism. The law of
comparative advantage and the superiority of market-based solutions remain
articles of faith in the WTO.
WTO and technicality

WTO is clearly biased towards a neoliberal agenda. However, in order to under-
stand WTO’s approach to sustainable development, it is equally important that
we come to terms with the organization’s distinct technical approach to interna-
tional trade. Almost all multilateral institutions are defined in their agreements
and charters as functional and technical institutions.6 However, lately several

multilateral institutions have adopted much broader agendas. With the broad-
ening of their agenda, most of these institutions also had to rethink their
recruitment policies, and found that they also needed to employ people with
other kinds of background than law, economics and engineering. The same sort
of development has not taken place in the WTO. There are no statistics avail-
able on the employees’ educational background,7 but WTO’s external relations
division confirms that lawyers and economists are predominant.8 The result is an
institution with a highly technical approach to international trade (law) where
there is little room for other considerations, whether social or environmental.
The consequence was that sustainable development could only be incorporated
into WTO if the idea could be adapted and/or distorted in accordance with the
already existing problem definition of international trade in the organization. As
we have seen from the reference to sustainable development in the preamble to the
Ministerial Declaration, this was possible. Thus a real re-examination of
GATT/WTO’s purpose was not necessary. The knowledge on which ‘sustainable
development’ was founded could be presented to the WTO in the same techno-
cratic language as the old and familiar knowledge of neoliberal trade theory. This
meant that it was possible to keep the discussion on sustainable development in the
WTO within the frame of its ‘standard operating procedures’. It is here that the
issue of knowledge and the assumed political neutrality of a certain type of
economics enters the picture, because the legitimacy of the WTO rests on the
claim that its economic advice reflects the best possible research, a justification
readily cited by member governments when imposing WTO policies on their often
unwilling populations.
The production of knowledge in the WTO is therefore produced within a
frame of reference that embeds certain cognitive interests, meaning that knowl-
edge becomes an instrument, a tool, for the identification of manipulable
variables. The economics of the WTO is presented as an objective, value-free
scientific discourse. The laws of neoliberal economics, it is argued, are universal
and it is the task of the WTO to make certain that the member countries
conform to these laws. The various issues and questions concerning international
trade are presented as technical issues, because trade is seen as socially, politically
and environmentally neutral.
Secrecy and lack of transparency

The making of international trade policy has traditionally been the responsibility
of the state, or more precisely, an issue-area dealt with by a small group of trade
bureaucrats and politicians who conducted their policy making within a small
secure circle of like-minded persons, behind closed doors and under high levels
of secrecy.9 Trade policy was rarely an item that was prominent on the public
agenda.
This may explain why the Secretariat was so stunned by the environmental
NGOs’ reactions to the outcome of the Tuna–Dolphin Dispute in 1991. GATT
had no standing operating procedures for relations with civil society organiza-
tions, and the institution had little awareness of how important the
trade–environment nexus was becoming in the eyes of not only the NGOs, but
also large segments of the population in important member countries.
Thus, when the idea of a world trade organization was placed on the agenda
in the latter part of the Uruguay Round, the increased scope, permanence and
rule-making authority of the proposed organization alarmed environmentalists
and other civil society actors. The suggestion that authority over vital national
decisions was about to be transferred from the nation-state to a supranational
organization shrouded in secrecy was an idea many civil society organizations
found alarming (O’Brien et al. 2000: 136). Their main concern was precisely that
during GATT’s history, the institution had failed completely to establish any
formal linkages with NGOs or other civil society organizations. Conditions for
consultations with NGOs had been clarified in article 87 (2) of the Havana
Charter. However, the failure to establish ITO made the preliminary GATT last
for forty-seven years, and the culture of secrecy in the multilateral trade negotia-
tions that evolved effectively kept NGOs and civil society organizations outside.
The argument from the NGOs was that access to information and participation
was not only vital for democracy, but would also improve the policy outputs of
the WTO.
The WTO was forced to take some of these issues seriously. Article v.2 of the
Agreement establishing the WTO institutionalizes some standard operating
procedures for consultation with NGOs: ‘the General Council may make appro-
priate arrangements for consultation and co-operation with non-governmental
organizations concerned with matters related to those of the WTO’. And it was
also suggested that NGOs could be consulted through the dispute settlement
mechanism (DSU). Article 13.2 of the DSU states that: ‘Panels may seek infor-
mation from any relevant source and may consult experts to obtain their opinion
on certain aspects of the matter.’ In July 1996, the secretariat was also empow-
ered to engage directly with NGOs (WTO 1996a). The Secretariat was therefore
now given the responsibility for liaison with NGOs. In the same year, the
General Council of WTO also agreed to declassify documents that previously
had been kept from the public (WTO 1996b).
The more reform-oriented of the NGOs are aware that the nature of trade
negotiations means that open-access for all civil society organizations is not
possible. However, they have argued strongly that membership of the WTO
Committee on Trade and Environment (CTE) should be enlarged to include
NGOs. They have criticized the DSU for not making more use of independent
experts. And on the issue of transparency they have focused on the existing
arrangements for declassification of WTO documents. In their view, the current
practice of keeping documents restricted until six months after being issued is
seriously handicapping civil society’s ability to monitor the WTO. The WTO on
the other hand is mostly concerned with what the organization sees as the ever-
present threat of the forces of protectionism, and will therefore not encourage
the involvement of what it sees as potentially protectionist groups.
Institutional identity
Each multilateral institution has its own identity, and we will argue that the insti-
tutional identity of the WTO is formed around an organizational culture of
neoliberal trade theory, a technical approach to trade issues and a culture of
secrecy. There is clearly both an internal and an external side to an organiza-
tion’s identity, and for us it is clear that ‘the response of the WTO to the
environmentalist challenge has been shaped by its organizational ideology, orga-
nizational characteristic and the ability of environmental NGOs to threaten its
core objective of trade liberalisation’ (O’Brien et al. 2000: 141).
The way WTO met its critics in the NGO movement should be interpreted in
light of the Secretariat’s identification with the core of free trade theory. The
lack of knowledge among WTO staff members about environmental issues and
their links to international trade issues is one important reason why the environ-
mental challenge was interpreted within a traditional free trade versus
protectionism context. The environmental challenge was beyond their knowl-
edge frame, and the response was therefore to treat it as a threat. The basic point
is that ‘knowledge is produced within a frame of reference that embeds certain
cognitive interests’ (Nustad and Sending 2000: 60), and the meeting between
trade and environment was, if not a clash of paradigms and cultures, at least a
clash between different types of knowledge. The vision, language, strategies,
procedures and traditions of the environment movement are fundamentally
different from those of the free traders of the WTO. The very different
approach, measures and vision that the environmental NGOs promoted had few
if any tangible points in common with the trade regime of the WTO.
WTO’s approach to sustainable development: the work

of the Committee on Trade and Environment
EMIT was established in 1971, but no meetings were held until the EFTA-
initiative revived it in 1990. The working group therefore had only a few meet-
ings before a more formal committee – CTE – was established by the Marrakech
Ministerial decision on trade and environment in April 1994. CTE conducted its
first meeting in February 1995. Since then the CTE has held thirty-five meet-
ings, delivered annual reports to WTO’s General Council, more elaborate
studies to the Ministerial Meetings in Singapore in 1996 and in Seattle in 1999,
and a paper for the High-level Meetings on Trade and Environment held in Geneva in
March 1999.
The summaries of the CTE meetings are posted on WTO’s website, but the
committee is very much under the influence of WTO’s general culture of
secrecy. The meetings are held behind closed doors and NGOs are not allowed
to participate in them. Even other multilateral institutions – such as the United
Nations Conference on Trade and Development (UNCTAD), the United
Nations Environment Programme (UNEP) and the Organization for Economic
Cooperation and Development (OECD) – only have observer status and were
allowed to make formal contributions only after the Singapore Ministerial in
1996 (Nordström and Vaughan 1999). The process in the CTE has primarily
been driven by the member states, but the WTO Secretariat also has contributed
to some reports and statements. According to Esty (1997: 15): ‘The debates to
date have been dominated by trade officials with little contribution from an envi-
ronmental perspective.’ The CTE is therefore perceived by the NGOs as being
biased toward the protection of free trade and not towards environmental
protection and sustainable development.
CTE’s first report to the WTO Ministerial in Singapore in December 1996
was considered a disappointment by the NGOs: the CTE had not been able to
clarify central issues such as the status of Multilateral Environmental
Agreements (MEAs) in relation to international trade law and the issue of eco-
labelling. A new attempt was made by the CTE to respond to environmental
criticism prior to the Seattle Ministerial. This new report discussed the
trade–environment nexus, and in particular it addressed the so-called ‘race-to-
the-bottom debate’. The general conclusion of the report was that trade
liberalization reinforces the need for environmental cooperation. Apart from this
conclusion, however, the report is more than anything a manifestation of the
kinds of values that are embedded in the WTO. The study on which the conclu-
sion is built is significantly influenced by the assumption that trade always leads
to greater prosperity and improved environmental conditions. This assumption is
arrived at via the environmental Kuznets curve hypothesis. The problem for the
WTO with this kind of argument is that the environmental Kuznets curve is not
only disputed among academics, but to most NGOs it also illustrates an econo-
metric neoliberal worldview.
The argument from the majority of the NGO movement was therefore that
not only has the CTE failed to make any progress on the trade–environment
nexus, but it has also threatened the existing consensus by seeking to enlarge
WTO’s jurisdiction. In one interpretation of CTE’s activities, it is suggested that
trade measures agreed in multilateral environmental agreements could be taken
before a WTO Dispute Panel. In other words, WTO members could try to use
the dispute settlement mechanism in the WTO to undermine already existing
agreements on trade and environment (O’Brien et al. 2000). This perception led
the NGOs to shift their attention towards the WTO’s dispute settlement system.
Sustainable development and WTO’s dispute

settlement system
The dispute settlement mechanism has become the new centre of attention for
the NGOs. This alternative route of access to the policy making process of the
WTO is, however, also full of barriers. The failure of the WTO to clarify the
procedural rules for submitting amicus briefs to the Appellate Body is an
important indicator in this respect. In October 1998, the Appellate Body did
rule ‘that dispute settlement panels could consider spontaneous submissions
from non-governmental groups’ (Bridges 2000a: 1). However, when the
Appellate Body then established a procedural rule for the submissions of
friend-of-the-court briefs, this was considered to violate the ‘member’s rights

and the government-to-government nature of the WTO’ (Bridges 2000a: 1, 4).
One example is the important asbestos dispute, where strong opposition from
member countries made the Appellate Body turn down all such briefs
submitted for this case. This led most of the environmental NGOs involved in
this case to condemn the Appellate Body for ‘lack of procedural fairness’ and
for not clarifying which of the requirements their briefs failed to satisfy. Rémi
Parmentier of Greenpeace International claimed in this respect that the WTO
‘have not learned the lesson from Seattle’ (Bridges 2000b: 1), and by dismissing
the input from civil society, the WTO was ‘fuelling the concerns about the
secretive way in which it makes decisions that impact on human lives and the
environment’ (Bridges 2000b: 1).
We acknowledge that the outcomes of environmental dispute settlements are
not a precise indicator of WTO’s approach to sustainable development, but they
do offer an indication of which values WTO favours in the settlement of
disputes. However, there are other procedural issues that could explain these
outcomes as well. The dispute resolution hearings are closed and highly secre-
tive. Decisions are taken by trade lawyers and economists, who do not have
much knowledge about environmental problems, and the Appellate Body that
interprets and assesses the dispute panels’ reports in accordance with interna-
tional law, has changed the outcomes of several of the disputes.
Despite these institutional barriers, some moderate environmental NGOs
have had a certain degree of influence on the handling of environmental
disputes (see Vevatne 2000a). One example is the Shrimp–Turtle dispute. In this
particular case, the World Wide Fund for Nature (WWF) and the Center for
International Environmental Law (CIEL) submitted amicus briefs to the dispute
panels. These briefs were rejected, but they re-appeared as an attachment to the
statement paper of the United States. Here the NGOs did have quite substantial
influence in the end, but this was much more due to their ability to lobby
American policy makers in Washington DC than the openness and willingness of
the WTO to hear their claims. In this case, the Appellate Body supported the
United States, and thereby also the environmental NGOs on a number of issues.
In particular, the NGOs welcomed the fact that the Appellate Body acknowl-
edged that the sea turtle is a non-renewable natural resource close to extinction
and thereby fulfilled the conditions of GATT article XX(g). And, even more
important, for the first time the Appellate Body emphasized that WTO agree-
ments had to be interpreted in light of the reference to sustainable development
and environmental protection in WTO’s preamble. The NGO community saw
this as an important decision. However, their victory was only partial, because
even though the Appellate Body did find that the US law in question in this case
(Section 609 of ESA) was a legitimate attempt to protect the sea turtle, the
implementation and design of the law was not. Even more important in this
case, however, is the fact that the briefs from the NGOs were rejected by the
WTO. The only reason they re-appeared was due to the ability of the WWF and
CIEL to influence American decision makers.
WTO’s relations to non-state actors: the post-Seattle

trauma
The many people who voiced their opinion about the WTO on the streets of
Seattle not only delayed the start of the meeting, but they also very successfully
drew media attention to both the WTO in particular and international trade
issues in general. The demonstrations had little direct impact on the negotia-
tions, but they contributed to the strengthening of existing divergent interests
and opinions within the WTO, and thereby also helped cause the failure of the
Ministerial and the launching of the Millennium Round (Fitzpatrick 1999;
Vevatne 2000b). The support the protesters gave the delegates from Africa, the
Caribbean and the Pacific helped these delegates withstand the pressure from
the leading OECD member countries (Ritchie 2000).
The actions of the NGOs and the collapse of the negotiations underscored
several significant weaknesses both with respect to WTO’s transparency policy
and the procedures and practices of WTO negotiations. After Seattle, it became
generally accepted that WTO had to address these issues. As Rémi Parmentier
of Greenpeace International puts it: ‘The WTO has two options. Either its next
meeting is in Pyong-yang, North Korea, to avoid the protests from civil society or
it changes its attitude toward public scrutiny and democracy’ (quoted in
Fitzpatrick 1999). In fact, for a long time, it was difficult to find someone willing
to arrange the next Ministerial. In the end a candidate was finally found, but the
choice of Doha, Qatar, as the host of the Ministerial of November 2001 was
quite strange. To hold the next Ministerial in the middle of the desert in a
country with limited rights to speak and demonstrate, illustrates in our view
WTO’s lack of understanding of the seriousness of the challenge from the
Seattle events.
Conclusion
The WTO has adopted the concept of sustainable development, but only into its
preamble, not into its trade rules. The main reasons for this are the WTO
Secretariat’s technical approach to international trade and the ideological hege-
mony of neoliberal free trade theory in the WTO. This has influenced its
interpretation of non-trade concerns, such as sustainable development. In addi-
tion, we would draw attention to the fact that WTO employees’ institutional
identity was strengthened when confronted with the environmental NGOs’ criti-
cism because this criticism challenged the organization’s foundation: free trade
theory. Confronted with this external critique, the employees’ loyalty to the
WTO and its core idea increased. Related to this is the fact that the organiza-
tion’s lack of procedures for formal relations to civil society made WTO
employees isolated from new impulses and competing views in the broader polit-
ical economy.
An important insight to be gained from this case study is therefore that for an
idea such as sustainable development to make a significant impact on an organi-
zation like the WTO, that idea and its promoters cannot be seen as contradicting
the hegemonic knowledge system and the collective identity formed around this
knowledge system. The main reason why the idea of sustainable development,
which has had a lasting impact on other multilateral institutions, has failed to do
so in the case of the WTO is precisely because the whole idea and its promoters
were seen as in opposition to the raison d’être of the whole organization, namely to
be the guardian of free trade.
Notes
1 The roots of the WTO can be traced back to December 1945 when the United
States invited fourteen countries to begin negotiations on liberalizing world trade.
The negotiations had two objectives: (1) to create an International Trade
Organization (ITO) that would facilitate trading relations as the World Bank and the
IMF facilitated monetary relations; (2) to implement as soon as possible an agreement
to reduce tariff levels. The second exercise resulted in the GATT, which was signed
on 30 October 1947. The idea was that once ITO was completed the GATT would
be subsumed in the larger organization. However, the US Congress refused to give its
agreement to the ITO. In fact, congressional opinion was so strong against the ITO
that in December 1950 the US administration dropped the initiative and asked
Congress to continue giving its support to the GATT.
2 The only reference to the environment in the GATT rules is GATT Article XX:
general exception; (b) ‘necessary to protect human, animal or plant life or health’
and (g) ‘relating to the conservation of exhaustible natural resources if such
measures are made effective in conjunction with restrictions on domestic production
or consumption’.
3 The agenda for the Uruguay Round was agreed upon in Punta del Este, Uruguay in
December 1986. The report of the WCED was launched four months later. In the
report of WCED both development and environment preservation are emphasized
and the report tries to strike a balance between them. The concept of sustainable
development was not new, but the WCED gave it a new and broader definition than
the former more narrow environmental interpretation of the concept. The WCED
underscored solidarity both within and between generations, by defining sustainable
development as the ability ‘to meet the needs of the present without compromising
the ability of future generations to meet their own’ (WCED 1987: 43).
4 The root of the Tuna–Dolphin Dispute is the US Marine Mammal Protection Act
(P.L. 92–5222, 86 Stat. 1027), enacted in 1972. This law requires the US government
to take steps to curtail the incidental killing of marine mammals by commercial fish-
ermen, both domestic and foreign. Specifically, this law instructs the secretary of
commerce to prohibit the importation of tuna products from countries whose dolphin
kill ratio (dolphin deaths per net dropped) exceeds that of US fishermen beyond a
certain margin. In 1988, Earth Island Institute, a California-based NGO, sued to
enforce this law, and a federal judge agreed that the US government was failing to
uphold the law and ordered Mexican tuna imports banned from the United States.
Mexico then asked for a GATT dispute settlement panel to adjudicate the matter. In
September 1991, the panel concluded that the United States was in violation of its
GATT obligations. This decision provoked heated debate over the fairness of GATT
resolutions of trade and environment conflicts. For further details see Esty (1994).
5 Authors’ translation from the Norwegian.
6 The only important exception is the European Bank for Reconstruction and
Development. This MDB was established after the end of the Cold War with the
objective of transforming the former planned economies of Eastern Europe into
market economies.
7 Personal interview with Risa Schwarz (WTO’s Trade and Environment Division), 13
October 1999.
8 Personal correspondence with Bernard Kuiten (External Relations Officer, WTO), 27
April 2000.
9 It is only states that participate during the year-long negotiation rounds, with little or
no participation from the parliaments and often with limited public debate, too. Only
parties to the Convention (states) are allowed to submit objections/papers to the
dispute settlement mechanism. WTO does not accept, as other international institu-
tions do, that non-state actors file complaints or submit amicus briefs to denounce or
allege a failure (ICTSD 1999). Despite the Appellate Body’s opening for amicus briefs
from non-state actors, the practice was again limited in the Asbestos Dispute (see
Bridges 2000a: 1).
8 Social capital and the World
Bank
Desmond McNeill
Introduction
The idea of social capital has been very actively promoted by the World Bank
in recent years, and in this chapter I am concerned specifically with how and
why this came about; and with the tensions, contradictions – and perhaps reso-
lutions – that result from seeking to apply it in development policy. The
concept, as presented by the political scientist Robert Putnam in his book
Making Democracy Work: Civic Traditions in Modern Italy (Putnam 1993a), became
astonishingly popular among academics and the wider reading public, at least
in the United States, in the space of a very short time in the late 1990s.1 Why
this enormous appeal? One reason, which many have noted, is that the
concept – and the main thesis of Putnam’s book – appeals to a perhaps
nostalgic view of community, and values which are in danger of being lost in
the modern world. But Putnam also offers a hard-headed argument in favour
of such values: that they actually encourage economic growth. The concept of
social capital helps one to believe that community, trust and shared values are
‘a good thing’ – as demonstrated by Putnam’s comparison between the very
different economic fortunes of Northern and Southern Italy. And academics
with widely differing perspectives find it appealing. As one reviewer puts it: ‘He
[Putnam] has interpreted his results in such catholic terms that students of
cultural interpretation and public choice – who differ in so many ways – can
find common ground in the outcome’ (Tarrow 1996: 396).
Although it was the political scientist Putnam who hit the headlines, sociolo-
gists – notably Coleman and Bourdieu – played a major part in establishing the
concept of social capital within their discipline.2 It has in recent years been
applied in a number of different fields, including the study of management.
Within development studies, the concept and the argument fit very well with
current debates among researchers and development assistance agencies
concerning ‘governance’, ‘democracy’, ‘civil society’ and related issues: debates
that badly need a strong empirical and theoretical base.
The first World Bank Working Paper on the subject refers to three alternative
definitions, of which:
Social capital and the World Bank 109
The most narrow concept of social capital is associated with Putnam

(1993) who views it as a set of ‘horizontal associations’ between people:
social capital consists of social networks (‘networks of civic engagement’)
and associated norms that have an effect on the productivity of the
community.
(World Bank 1998b: 1)
A second and broader concept of social capital was put forth by Coleman (1988)
who defines social capital as ‘a variety of different entities, with two elements in
common: they all consist of some aspect of social structure, and they facilitate
certain actions of actors – whether personal or corporate actors – within the struc-
ture’. In fact, this view of social capital captures social structure at large, as well as
the ensemble of norms governing interpersonal behaviour. A third and most
encompassing view of social capital includes the social and political environment
that shapes social structure and enables norms to develop (World Bank 1998b: 1).
This third and broadest definition, I suggest, appears to include almost
anything, and certainly extends social capital well into the domain of gover-
nance. This becomes clear in the World Bank Working Paper by Knack, ‘Social
Capital, Growth and Poverty: A Survey of Cross-country Evidence’:
In keeping with the scope of the World Bank’s Social Capital Initiative, it is
defined broadly here to include features of both government and civil
society that facilitate collective action for the mutual benefit of a group,
where ‘groups’ may be as small as households or as large as a nation.
(Knack 1999: 1)
Knack here adopts Collier’s (1998) terminology of ‘government social capital

and civil social capital’. The former, it is clear, overlaps with such concepts as
civil liberty, political freedom and governance.
In this chapter I shall explore how the concept of social capital has been
taken up in the World Bank, drawing largely on empirical material from a major
conference on social capital organized by the World Bank in 1999, supplemented
by material from an earlier and smaller World Bank workshop, from the World
Development Report 2000/2001, and from some contacts with key individuals.
Social capital is one of several ‘ideas’, which have the ability to or are expected
to act, as ‘bridging concepts’, in one or more of three senses:
• a bridge between research and policy;

• a bridge between different disciplines;
• a compromise between competing policies.
The analysis in this chapter will be structured in relation to these three points.
But I will preface this with a few words about the World Bank, which may help
to explain its interest in the idea of social capital.
110 Desmond McNeill
There has, in recent years, been an increasing recognition, in the World Bank
– and more generally among development assistance agencies – of the impor-
tance of community participation. This is manifested in, or at least related to, an
increasing involvement of ‘civil society’ – often, in practice, taken as synonymous
with non-governmental organizations (NGOs) – both in the planning and imple-
mentation of projects in the field, and in consultation processes at headquarters.
Also related is the increasing number of anthropologists and sociologists working
for the Bank, and organizational changes, which have given greater prominence
to social issues (Cernea 1994). There has also been a significant shift within the
Bank towards the inclusion of political issues, notably through the Bank’s work
on ‘governance’. These changes have given greater recognition to the need for
insights from disciplines such as sociology and political science.
The World Bank has always had an ambition – one which it has generally
been rather successful at achieving – to be at the forefront of ideas; if not initi-
ating them, then at least rapidly taking them over (Ranis 1997; Stern and
Ferreira 1997). The discipline and language, of economics has for many years
been dominant within the World Bank, and especially in its Research
Department. New ideas must, therefore, in order to be accepted, survive criti-
cism by this particular discipline.3 The reason why the concept of social capital
is so attractive for the World Bank is that it allows the dominant economic
perspective to take into account sociological and political considerations which
have increasingly been recognized as important.4 The concept fits well at the
interface between economics and sociology – in the so-called ‘new institutional
economics’.5 Thanks to the work of Putnam, Coleman, and others, staff in the
World Bank could thus adopt a new term which was at the forefront of both
academic and popular debate; not only within the disciplines of sociology and
political science but – most important (for the Bank) – perhaps also in
economics. It is therefore understandable that research-minded Bank staff had
an a priori interest in the idea.6 This was a necessary condition for its success, but
hardly sufficient. The rapid progress of the idea required its being actively taken
up by those that count.
Who decides what ideas are to be taken up in the Bank? This is a complex
question to which I shall return below, which relates to the ethos of the Bank as a
whole, and what constitutes the reference group or groups of individual staff
members. As in any organization, certain key individuals play an important role,
and in this case several seem to have played a part in giving the idea of social
capital prominence in the Bank.7 Edwards (1999: 2) gives the credit to the
President, James Wolfensohn, and Joe Stiglitz, Chief Economist and Senior
Vice-President. The former has certainly shown a special interest in participation
and involvement of NGOs, which created a supportive context; while the latter,
who has a very high reputation for his work on the economics of information
and institutions, has also helped to legitimize the concept. But a very important
role was undoubtedly played by Ismail Serageldin, formerly Vice-President,
Sustainable Development, who has had a keen interest not only in the environ-
ment, but also in the social dimension of development – as evidenced from his
writings on ‘culture and development’ and the ‘ESD triangle’ which combines
the economic, the environmental and the social perspectives (Serageldin and
Steer 1994).
External actors have also played a significant part – at the invitation of key
individuals within the Bank. Mancur Olson was actively involved at an early
stage, before his untimely death. Others participated in workshops and other
events where World Bank staff and academia were in dialogue.8 Putnam was
brought in and participated in the Social Capital Initiative (SCI) of the Bank,
including giving a high-profile public lecture at the 1999 conference.
According to Collier, ‘Putnam was the most important. … You can get any old
fad going, but to be sustainable it must have a core of rigour to it. That comes
from the academic side’ (personal communication, 1999). Neither Olson nor
Putnam is an economist, but – in what may be seen as an important tactical
move – a number of very prestigious economists, including Nobel Prize
winners Arrow and Solow, were invited to informal meetings at the World
Bank to discuss the concept.9 It was of crucial importance that senior
economists within or close to the World Bank should take it seriously. But opin-
ions among influential figures in the Bank apparently differed. One regarded
the empirical results claimed as ‘terribly contrived’; while another felt that
there was a ‘pot of gold’ here.
In addition to enlisting the interest, and in some cases support, of prestigious
economists, Serageldin was also active in obtaining external funding – from
Norway and Denmark – for the two research programmes on social capital
described below.10 Serageldin’s definition of social capital is broad: ‘the institu-
tional and cultural basis for a society to function’ (Serageldin 1996: 1888). Like
others, he saw it as a natural addition to earlier types of capital – but in his case
linked expressly to the concept of sustainable development. As he put it in the
foreword to SCI Working Paper 1: ‘The traditional composition of natural
capital, physical or produced capital, and human capital needs to be broadened
to include social capital’ (World Bank 1998b: i).
In brief, a conjuncture of key individuals and structural factors may be said to
have played their part in causing the concept of social capital to achieve such
rapid prominence in the Bank. The two major research programmes on social
capital which I shall describe may be seen as both a symptom and also a contrib-
utory factor.
The conference
The World Bank recently completed two major research programmes on social
capital: one financed by Norway, the other by Denmark. Norway supported a set
of three major studies – in Indonesia, Burkina Faso and Bolivia: the Local Level
Institutions (LLI) Project.11 The preliminary results from these three studies were
presented at a small workshop in Bergen in May 1999 attended by about thirty
participants, approximately one third of whom had been involved in the
research itself. Denmark supported a larger number (twelve) of smaller studies –
112 Desmond McNeill
with less ambition in terms of adopting a common methodology. The studies

covered fifteen countries and a wide range of sectors. The conference at which
the results were presented was held at the World Bank in Washington in 1999
and was attended by over 100 participants. In this chapter I draw mainly on
experience from the latter conference, which not only included a far larger
number of people, but was also broader in the range of types: from academics to
operational staff. It is therefore more revealing in terms of gaps and tensions
between different positions. I shall make extensive use of quotes (mainly from
this conference), and in most cases attribute these to categories of people, as
follows. (In some cases I shall [usually in addition] name the individual
concerned.)12
• researcher – economist
• researcher – social scientist13
• policy staff – economist
• policy staff – social scientist
• operational staff
I have claimed that the concept of social capital may serve to bridge three
different ‘gaps’, and I shall structure my discussion of the issues by focusing on
these three in turn, offering in each case a brief analysis of the issue and some
symptoms of the tensions. But first I will give a little more background informa-
tion about the conference itself. Here I quote one of those who had been heavily
involved in the research programmes:
The Social Capital Initiative (SCI) was established three years ago at the
initiative of Ismail Serageldin (then Vice-President, Environmentally and
Socially Sustainable Development). The purpose was to understand it,
measure it, and monitor its effect on development. There was much scepti-
cism, in view of which he saw the need to set up a research programme …
to demonstrate [its importance] empirically in a rigorous way. Support was
received from Denmark to finance 12 teams in 15 countries. The studies
were multidisciplinary, involving economics, sociology, anthropology, polit-
ical science and other disciplines. They ranged from quantitative to
qualitative studies, and entered uncharted territory.
(policy staff – economist)
Another staff member, also very closely involved, expressed support for the
concept and the research:
Social capital is precious. It is about human relations … deeply embedded.

What should be the meaning of these studies for development? I am
convinced that institutions and relationships are important; this is the first
time [we are studying them empirically].
(policy staff – social scientist)
A similar point was made more forcefully by one of the commentators

(researcher – social scientist) later in the conference: ‘Social capital is the
battering ram to get social issues into development’.14 But perhaps the most
revealing remark of all came in the introduction by Ian Johnson, Vice-President,
Environmentally and Socially Sustainable Development Network.
At long last, having used the word in numerous meetings, I can find out
what it means. [There has been an] evolution of thinking in the Bank: from
financial capital to physical capital, and then human capital. Now we need
to add natural capital and social capital. I think it is a very profound concept
and one that we absolutely have to come to grips with. … Fascinating pieces
of work, really at the cutting edge, which could have a profound impact on
the way we do our work at the Bank.
This disarming blend of expectation and ignorance summarizes, I believe, the

situation of many of those – of the policy and operational staff – attending the
conference. Some were, no doubt, very sceptical. But many were eager to find
out what this new ‘idea’ was, and how it might contribute to policy.15
The gap between researchers and policy makers
Complexity/simplicity
While policy makers and operational staff favour simple (‘common sense’) analysis
and approaches, researchers revel in complexity. As I have argued elsewhere, this
arises from the very nature of their differing tasks, and the imperatives that drive
them.
Policy-makers … require that the world be simple and uniform. … The

researcher is, by training if not by nature, out to disagree: to find the excep-
tion to the rule, the subtle failing of logic, the anomalous case. …
Researchers thrive on complexity, variety and, indeed, on intellectual
conflict. But this is no basis on which to establish general – let alone global –
policy prescriptions; no way of building a consensus.
(McNeill 2000: 327)
This gap was very evident at the conference, in the comments and discussion.
For example, one of the comments on a paper was that it offered ‘commonsen-
sical conclusions’. The commentator (operational staff) asked whether ‘all this
wonderfully complex [analysis] was needed’ (This evoked laughter from the
audience).
In response it was claimed: ‘The insights are commonsensical – but common-
sense is not always evident in development thinking. Perhaps social capital can be
a bridge between community needs and development theory. To bring common-
sense into the mindset of development work’ (researcher – social scientist).
114 Desmond McNeill
Another researcher (economist) stated, ‘I think I detect an underlying tension

between academics on the one hand and practitioners on the other.’ Another
was clear as to the potential use of social capital: ‘If social capital is to be valu-
able it should be of instrumental value. It should be an independent variable. …
The dependent variable is welfare.’
The importance of instrumentality, and ‘operationalization’ was made clear
many times – not least in relation to the question of how to define the term
social capital.16
Importance/non-importance of definitions
Academic social scientists, and perhaps especially economists, tend to be very
concerned about definitions, and may devote enormous effort to competing
alternatives. Policy makers often see this as a waste of time: ‘academic’ in the
pejorative sense of the word. At the conference there was some reference to this
issue. One of those presenting the findings of their research: ‘We did not have a
clear idea of what was meant by social capital, beyond a sense of cohesion
leading to reduced transaction costs’. And another (policy staff – social scientist):
‘Which definitions are most useful? – those which lead to what is fruitful in oper-
ational terms.’ On the question of definition: ‘It is all right if we [economists and
sociologists] do not talk to each other’ (researcher – economist). And: ‘We need a
refutable concept, relatively crisp.’
Here it is relevant to quote SCI Working Paper 1:
The lack of conceptual clarity stands in the way of the measurement of

social capital, and the variety of existing definitions makes it inherently diffi-
cult to propose a list of indicators. Instead, indicators will have to evolve as
the conceptual and, more important [my stress], the operational definition of
social capital, are developed.
Concern/lack of concern with central methodological issues

The question of definition relates also to methodological issues, such as ‘what is
being measured?’ and ‘what is the direction of causality (when correlation is
established between social capital and performance)?’.
At the conference, this issue arose only occasionally, for example when a
World Bank staff member raised what he called ‘the problem of endogeneity’.
The response, from one who had conducted research, was: ‘A great deal of
fishing and data-mining went on’ and ‘I am not sure which way the arrows go
[i.e. social capital to or from development outcomes]’. These issues were,
however, taken up at greater length in the first workshop, perhaps because in that
research programme more effort was made to ensure that the studies were
undertaken on the basis of a common methodology – and there was more time
to discuss detailed methodological questions.
These different manifestations of the gap between researchers and policy

makers underline my central point that those concerned with determining and
implementing policy do not have the time or the inclination for long-winded
debate. This is well described by Michael Edwards, based on his experience as
Civil Society Adviser in the World Bank:
On a good day in my old job at the World Bank, I would be asked to define
‘civil society’ by any number of sceptical colleagues. … On a bad day they
would ask me … ‘what is social capital?’ But worst of all was the inevitable
sequel: in that case, what’s the difference between social capital and civil
society? Before I’d reached the end of my first paragraph of long-winded
explanation, the questioner would have disappeared around the corner,
back to the ‘real work’ of lending billions of dollars to recalcitrant govern-
ments. … In the World Bank, as in all bureaucracies, this year’s theory will
be next year’s policy.
(Edwards 2000)
The gap between disciplines

The second major gap with which I am concerned is that between disciplines. In
the case of social capital, and this conference, the relevant disciplines are
economics, political science, sociology and anthropology. (Arguably, the first and
last named define the extremes, in methodological terms.)
A researcher (economist) described the predicament he faced: ‘This is pure
smoke – not serious – this is what people say when I present this at economics
departments.’ He added: ‘I have worked very little with social anthropologists.
But quite a lot with political scientists. We find that it [the lack of communica-
tion] is mainly language, not substance.’ A researcher (social scientist) was
concerned that economics was dominant at the conference, as indicated by the
order in which papers were given: ‘I am struck that we have started from
economic perspectives. We need to put others up front. We need a balance.’
The issue was also discussed at the earlier workshop, at which a social scien-
tist researcher challenged what he referred to as the ‘anthropologization of
political science and economics’ and referred to the concept as ‘anthropolog-
ical wine in economic bottles’. A commentator defending the approach in
Collier’s paper, which had been described as too limited, argued for the neces-
sity of starting with something ‘tractable’, and added: ‘One comes with the
disciplinary hat one has.’
It is beyond the scope of this paper to elaborate on the differences between
disciplines.17 I would, however, simply note the following contrasts between
economics and anthropology, some of which were referred to during the confer-
ence: measurement vs. description, quantitative vs. qualitative analysis, specific
vs. generalizable findings, rigour vs. richness.18
The last of these merits some elaboration, relating as it does to what might
be described as varying degrees of risk-aversion in relation to one’s peers
116 Desmond McNeill
(whether these are academics or policy makers). Insistence on rigour, some-

times equated with quantification, is a means to reduce risk.19 But perhaps the
very phenomenon which social capital seeks to grapple with eludes quantifica-
tion – and even rigorous definition. This was the theme taken up by one of the
key figures in the research programme and conference (policy staff – social
scientist), at the very outset of the conference, who noted that social capital
involves ‘stories, myths, religion, proverbs, language’, and that ‘however able
we are to box it and measure it’ some of it remains impalpable. ‘We are social
creatures, living in social groups. [Social capital concerns] these values that
hold us together.’ Taking a considerable risk in relation both to the academic
and the operational community, this presenter went so far as to quote from The
Little Prince by Antoine de Saint-Exupéry in order to indicate what is the
essence of social capital: ‘I am a fox. … I am not tamed. … What does that
mean? … It is an act too often neglected. It means to establish ties.’ Such views
may be contrasted with those of Collier, Director of the Economic Research
Group at the Bank, who sees the need to collaborate with other social scien-
tists, but believes that economists have an important role in bringing greater
rigour:
Economists are trained to high standards of precision in thought, especially

causal arguments. The mindset which gives you econometrics is the mental
hygiene of disentangling causation. Putnam’s work was interesting, but there
was not absolute clarity on the causal structure. I felt it was right (but) what
was missing was the analytical micro-foundations, the part economists are
best able to get into is the notion of networks. That nests in neatly with
costly information. This notion is the single most important revelation of
economics in our lifetime.
(Collier, personal communication, 1999)
The gap between alternative policies

As indicated at the outset, the attraction of Putnam’s social capital is that it
appears to promote both economic growth and community; giving the develop-
ment policy maker the best of both worlds. The gap between competing policies
is thus apparently bridged.20
Bowles sees social capital as the bridge between what may be an even broader
ideological divide – state vs. market: ‘The demise of the twin illusions of our
century – laissez-faire and statism – [thus] cleared the intellectual and rhetorical
stage for social capital’s entry’, and
Once everyone realized that market failures are the rule rather than the
exception and that governments are neither smart enough nor good enough
to make things entirely right, the social capital rage was bound to happen.
Conservatives love it. … Those to the left of center are no less enchanted.
(Bowles 1999)
When considering alternative policies at this level of generality, ends and

means begin to become entangled. Certainly social capital relates to means as
well as ends. Thus it appears also to provide a bridge between two usually
contrasted approaches to development intervention: the participatory,
bottom-up and the more technocratic, top-down approach (see Chambers,
e.g. 1983).
Whether or not social capital will successfully provide a bridge in this regard
is as yet uncertain, depending on how – if at all – the concept can be ‘opera-
tionalized’. As already noted, this is an imperative in development agencies such
as the World Bank, and this was, indeed, a major intention in the Social Capital
Initiative, as indicated by Serageldin in his foreword to the SCI Working Papers:
‘The challenge of development agencies such as the World Bank is to opera-
tionalize the concept of social capital and to demonstrate how and how much it
affects development outcomes.’
It was clear at the conference that operational staff were of the same view.
Two quotations will illustrate the point:
For the concept to get a hold it has to be pushed out into the other sectors of
the Bank and operationalized [with] indicators and measurement [leading
to] mainstreaming in the World Bank, and other agencies.
(operational staff)
It is very difficult to get a grasp on social capital in an operational division of

the Bank. [We are] too technocratic, too oriented to central government,
supply side, changing the laws, supplying personal computers. One size fits
all. [Perhaps we should try] not ‘best practice’ but ‘good fit’.
(operational staff)
The latter quotation indicates some reservations about developing a fully

generalizable concept with direct applications for policy; a view which was
shared by some others. In her introduction, Gloria Davis, Director, Social
Development Department, noted that: ‘Many people believe that large institu-
tions like the World Bank should keep out.’ In the final session (at both the
conference and the workshop) others made somewhat similar remarks, for
example ‘Recommendation to the Bank: do no harm. … History matters and
politics matter’ (researcher – social scientist). Another staff member said: ‘This is
more urgent than human capital. We may be doing harm now’ (operational
staff). But it was not clear for all whether taking account of social capital is
necessarily at odds with a technocratic approach, or whether it offers a happy
compromise between a top-down and a participatory approach.
Disagreement between participants related not so much to the merits of
making the concept operational, but as to how best to do this: between those
who leapt uncritically over the gap between research and policy, and those who
paused to consider; between those who assumed that if social capital was a
meaningful and useful concept of the Bank’s operations, then the task must
118 Desmond McNeill
surely be to ‘build social capital’, to those who wondered whether the lesson
might be very different – that an understanding of social capital should induce
the Bank to restrict its activities – or at least to modify the form of its interven-
tions. There was, in other words, a disagreement between those who sought to
intervene or not intervene.
The three ‘gaps’ just described constitute a challenge both for the institution
and each person within it. The actions of the World Bank are the outcome of
many actions of many individuals. In determining what attitude to take to a
new concept such as social capital, individuals within the World Bank ask
themselves not only ‘Will this concept lead to better policies?’ but also ‘Will
this be good for my institution?’, and further, perhaps, ‘Will this be good for
my department?’. And ‘good for me?’. In asking the last of these questions,
each person necessarily relates to a peer group, or perhaps more than one peer
group – for example of other staff within the same division and of academic
economists. Under normal circumstances, the boundaries and distinguishing
features of the different peer groups are fairly clear, though a person’s place-
ment within them may be less so. Thus each individual has a rather clear map
of the territory, but may either feel that they move within it, or are not entirely
sure where they fit. This then raises the question of who defines the territory,
who marks the boundaries, who guards the boundaries, etc. There is a consid-
erable literature on this subject within the social sciences, though I shall not
attempt to explore it further here. I do, however, suggest that the boundaries in
the Bank have been challenged and perhaps redefined in the debate over the
concept of social capital. But what has happened to the idea of social capital
in the process?
It is apparent that it has been required to satisfy a wide range of largely
conflicting purposes. It is my contention that this is both its strength and its
weakness. To the extent that it provides a substantive bridge across these
different gaps it is commendable. But if this bridge is illusory; if consensus is
achieved only because the concept means all things to all people, then it has little
value.
The term social capital featured quite significantly in the World Bank’s
controversial World Development Report 2000/2001 on poverty, and before
concluding this chapter it is worth commenting briefly on this document, which
illustrates the continuing tensions, and to what extent these were reconciled in
the World Bank’s annual flagship document.
World Development Report 2000/2001

In the draft version of the report, made available for comment on the internet,
the concept of social capital is referred to in several places, and used very exten-
sively in chapter 4, ‘Building Social Institutions and Removing Social Barriers’.
In the final version of the report, social capital is used far less, and with more
care.21 The following is included (almost unchanged from the draft) as the intro-
ductory paragraph in chapter 7 (the earlier chapter 4):
Social institutions – kinship systems, community organizations, and informal

networks – greatly affect poverty outcomes. They do so by affecting the
productivity of economic assets, the strategies for coping with risk, the
capacity to pursue new opportunities, and the extent to which particular
voices are heard when important decisions are made.
This is so general as to be uncontentious. But it is interesting to note the mixture of

agendas and ‘languages’: from ‘productivity of economic assets’ to ‘voices being
heard’. The following quotation from the draft version is more problematic:
The poor typically have a plentiful supply of bonding social capital, a modest
endowment of bridging social capital, and almost no linking social capital.
(World Bank 2000a: 4.4)
This claim may be true by definition (depending on how you define ‘bonding’,
‘bridging’ and ‘linking’ social capital). But it has not been shown empirically, and
its speculative nature is indicated by the give-away qualifier ‘typically’. The final
version is certainly more circumspect on this point (World Bank 2000b: 128).
Turning from analysis and description to policy, it is interesting to contrast the
following two quotations, again from the draft:
Development policy should thus seek to help marginalized groups build

more diversified ‘portfolios’ of social assets. … Responsibility for managing
these assets should be transferred as soon as possible to the groups them-
selves.
To reduce poverty and empower the poor the key issue is to find ways of
creating synergies between civic and state institutions and between formal
and informal institutions.
The first is an economistic, and technocratic way of presenting the issue; indeed,
a rather extreme example. The second is less so, but not particularly specific. A
third quotation, by contrast, indicates the potential dangers of intervention,
giving grounds for a cautious approach:
The National Federation of Herders in Central African Republic was

‘contaminated’ by donors giving it too much money.
This seems to reflect the more cautious, non-interventionist position of some of

those at the conference, referred to above. What is interesting is that all three
quotations are contained in the same chapter, indicating, I suggest, that there
120 Desmond McNeill
were markedly differing views as to what the World Bank should make of the
concept. But in the final version the term itself is used far less, and the differ-
ences of view are barely apparent.22
Conclusion
It is not my purpose in this paper to prescribe, or even forecast, the fate of social
capital in the World Bank, but this case study of an ‘idea’ and a development
agency provides valuable insights into the inner workings of a single, powerful,
multilateral institution. Between, and also within, development assistance agen-
cies there is a degree of competition; but the contests are fought within a
consensual arena, in that the explicit aim is common for all: namely better poli-
cies. Each institution (and perhaps especially the World Bank) seeks to lead the
rest of the development community in ‘the right direction’; to be first with the
good ideas.23 And social capital appeared to be such an idea. I suggest that the
concept of social capital is potent. It is seen as having power in two respects: not
only to steer policies in a good direction, but also the power to give authority – to
an individual and/or an institution (or part of an institution).
This case study is interesting because the World Bank here took a leading,
decisive role in promoting an idea which might, on the face of it, appear to be
risky in both academic and policy terms. It was risky in academic terms because
– at least within economics – it had yet to be tried and proved worthy. It was
risky in policy terms because it drew the World Bank further into the morass of
politics at the micro level. To push the point further, and develop the analogy of
Collier, I suggest that the Bank actively intervened in the marketplace of ideas – in what
turned out to be a hazardous venture.24
But then the question arises: who is the World Bank? Who was promoting the
idea? I have named some of those involved – such as Stiglitz and Serageldin –
and it seems that Wolfensohn himself was important; not perhaps in relation to
the concept of social capital itself, but in creating a supportive environment for
such ideas. And this helps to explain why others in the World Bank who might
have been expected to be not simply sceptical but actively opposed have not
been so; because the ethos of the World Bank is, perhaps, itself in flux – thanks
in part to the efforts of its president. Staff of the World Bank also have – under
normal circumstances – a fairly clear idea of what I might call the ‘ethos’ of the
institution as a whole, and of the different groups that they feel they belong to;
that is, their shared norms and values (whether explicit or implicit). But the
World Bank has, in recent years, been in a state of uncertainty, and perhaps
significant change. Under the leadership of Wolfensohn, it has presented itself
not only as a ‘leader in ideas’ but also as a ‘listening bank’. And it appears to be
listening to some ideas which, for the World Bank, are quite novel. Does this
imply a change of a very fundamental kind in the World Bank ethos, relating to
what might be referred to as the deep ideology of the Bank?25 Or are these
merely surface changes? As I have sought to demonstrate, there are very diverse
attitudes to the concept of social capital. It is accurate to state that the World
Bank is dominated by an economic perspective, and a technocratic perspective.

There are perhaps some signs of change with regard to the first; the economic
perspective is perhaps being modified to a limited degree. But the second can,
perhaps, never be changed. The very nature of the World Bank – and other
multilateral assistance agencies – is technocratic. And this surely limits the extent
to which alien ideas can have a real impact. I quoted earlier the analogy of social
capital as a ‘battering ram’. To adopt another analogy in the same vein, some
might portray social capital as a ‘Trojan horse’. Now it has successfully been
brought within the fortress – but are there any soldiers left alive inside?
Whether and how an idea such as social capital is taken up depends on a
complex interaction between individuals and the institution as a whole. If, as I
suggest, the institution itself is in a state of change, then individuals within it are
less sure than usual about what counts. And the opportunities for policy
entrepreneurs to take initiatives are greater.26 What proves to be the fate of
social capital will certainly depend in part on the merits of the concept in both
the world of academia (especially economics) and the world of policy. But any
inherent merit the term may have, in analytical and empirical terms, is not suffi-
cient. Perhaps it is not even necessary. As I have suggested, the idea itself may be
so unclear, so widely defined, as to mean almost anything. This, paradoxically, is
what has enabled it to gain such wide acceptance. Whether it will prove to be
potent in the longer term remains to be seen.
Notes
1 The study ‘caused a sensation outside academic circles’ (Tarrow 1996). The idea
apparently even inspired a passage in Clinton’s State of the Union address in 1995.
2 Not in collaboration; they adopt rather different approaches.
3 Economists may not be in the majority in numerical terms, but the dominance of
economic thinking is well established. The following comment by the Director of the
Economics Research Group is very pertinent:
The Research Department – which is mainly economists – generally sees itself

as the guardian of rigorous standards of thought. [To] defend against unadulter-
ated bullshit. There are flowery, flabby ends to everything – not just social
capital. [The Research Department is] filtering the marketplace of ideas, which
is full of charlatans. [It is] normal business to be testing to destruction ideas
which may be good, or popular fads.
(Collier, personal communication, 1999)
4 This view is implied, though not necessarily shared, by Grootaert (an economist) who
states in SCI Working Paper 3:
The term social capital has found its way into economic analysis only recently.
Some social scientists claim that the term social capital has been coined only to
make the underlying concepts acceptable to economics. Economists reply that
institutions and other aspects of social capital have always been present in
economic analysis. Economists have added the focus on the contribution of
social capital to economic growth.
(Grootaert 1998)
122 Desmond McNeill
5 This is closely linked to rational choice theory in sociology (e.g. Coleman). Whether it
fits the ‘old’ institutional economics of Polanyi (1944) and Veblen (1953 [1899]) is
more doubtful.
6 By calling them ‘research-minded’ I deliberately blur the issue as to whether this refers
to where they work in the organization (e.g. the Research Department), what are their
current tasks (e.g. writing working papers), or what they are most interested in.
7 I have not included here those who have been most directly involved in the research
programmes I shall describe – notably Gloria Davis (anthropologist), Deepa Narayan
(sociologist) and Chris Grootaert (economist).
8 For example, the sociologist Norman Uphoff (Esman and Uphoff 1984), who was
invited to a session at the rural development conference on George Washington
campus in 1995, chaired by Ismail Serageldin; and later attended the 1997 workshop
and the 1999 World Bank conference. The World Bank also maintained an email
discussion group on social capital – ‘Let’s Talk’ – for over two years (Deepa Narayan,
Let’s Talk posting no. 25, 10 Feb 2000, 07.12). Michael Woolcock acted as moderator
for the year 1999.
9 This initiative led to the publication of a book by Dasgupta and Serageldin (2000)
including contributions by several of the figures that I have referred to. Many are
positive, but both Arrow and Solow express considerable doubts about the use of the
term ‘social capital’ to refer to the phenomenon under study.
10 I was informed that these two programmes account for some 80 per cent of the work
undertaken on social capital in the Bank.
11 This involved large-scale household surveys in the three countries, which provided
strong empirical evidence, expressed in econometric terms, of the positive economic
contribution of social capital. (The research was initially planned without the concept
of social capital, as a study of local institutions.)
12 I have used the classification system partly to provide anonymity, but have named
individuals where I believe their formal position warrants it.
13 It is a debatable point whether these should properly be classified as ‘other social
scientist’. As Collier noted in a revealing comment on the place of economics in the
World Bank, there is a ‘very interesting usage in the Bank. They use social scientists to
mean non-economists. I was fazed by it!’ (personal communication, 1999).
14 It is relevant to add another quote, this time from one of the local researchers on the
Burkina Faso (LLI) study, at the earlier workshop in May 1999, who characterized the
World Bank as ‘a cumbersome, cold machine. … Not qualified to work at the local
level. … Knows how to deal with big things, not little things’, but added: ‘We are
delighted to have the concept of social capital.’
15 In a brief but interesting paper Edwards distinguishes three groups: ‘the enthusiasts
(mainly economists in the World Bank’s research division). … The tacticians (mostly
other social scientists in various parts of the Bank) … the sceptics (activists and
academics outside the Bank and a few iconoclasts within)’ (2000: 3).
16 An extreme (and perhaps intentionally provocative) example: ‘Putnam had a neat
idea, but it should not become a cult. If you cannot measure it, it is very unlikely
anyone is going to do anything about it’ (operational staff).
17 But see McNeill (1999b) and Becher (1989).
18 A World Bank Staff member suggested that with social capital one might achieve
‘Integration of quantitative and qualitative. … Precision vs. meaningfulness. … Social
capital as heuristic, not analytic’. Here may be an appropriate place to note that the
study in Tanzania, ‘Cents and Sociability’ (Narayan and Pritchett 1997) which played
a significant part in establishing the credibility of social capital within the World
Bank, was written jointly by a sociologist and an economist. The latter’s reputation as
a reliable econometrician was apparently very important.
19 It is not unusual for economists (who favour quantification) to claim that they apply a
greater degree of rigour than, say, anthropologists. But anthropologists might argue
that their discipline, although not employing quantitative methods, is more demanding
in relation to the empirical basis of its research, and rigorous concern for context and
local meanings.
20 There are similarities here with other earlier ‘ideas’. The informal sector seemed to
provide a bridge in the ‘redistribution vs. growth’ debate; and ‘sustainable develop-
ment’ a bridge in the ‘growth vs. sustainability’ debate.
21 The term appears twice or more on every page from 4.2 to 4.10 in the draft. In the
final version, it appears fewer times – and then mainly in ‘boxes’.
22 The World Bank should, in my view, be highly commended for making the draft
publicly available. It gives not only an opportunity for readers to comment, but also
an invaluable insight into the debates as they unfold.
23 This has become even more apparent recently, notably with the World Bank’s initia-
tive to take a leading role in the ‘Global Knowledge Network’.
24 See also e.g. Colander and Coats (1993).
25 This ‘deep ideology’ is difficult to describe, but an important aspect is an emphasis on
results and a rejection of approaches which are ‘soft’. (As the latter word exemplifies,
the language of the World Bank is revealing. Other expressions which are commonly
used include ‘touchy-feely’, ‘gooey’ and ‘flabby’.)
26 I must here again stress the distance between the researchers and policy makers in
Washington and the operational staff in the field. Even if major changes occur in
relation to the former, these may not reach to the latter.
9 Hegemony, neoliberal ‘good
governance’ and the
International Monetary Fund
A Gramscian perspective
Ian Taylor
Introduction
The promotion of ‘good governance’, as advanced by international institutions
such as the International Monetary Fund (IMF), is a powerful example of how
certain ideas are constructed as common sense. In this analysis, good governance is
seen as a hegemonic discourse pursued by the North in an attempt to define the
South in its own image. A form of transformation, akin to a passive revolution,
seeks to co-opt and assimilate elites within the South into a broader transnational
historic bloc, sharing the assumptions and class interests of the dominant fractions
centred in the core. Such ongoing impulses contribute to the reconfiguration of the
South in an epoch of global restructuring. Crafting consent to such favoured solu-
tions, this process is integral to a neo-Gramscian understanding of the role of
international institutions in global politics. This being so, the promotion of ‘good
governance’ reflects the potent role of ideas in international politics and the part
played by multilateral institutions in such endeavours.
Currently, ideas surrounding the economic and political principles referred to
as ‘neoliberalism’ are immensely powerful. Amongst a transnational elite class
they have achieved hegemonic status on how best to restructure political and
economic life. Although technological innovation and changes in production
root much of this in the material realm, the importance of ideas is quite
apparent when attempting to understand how neoliberalism is currently domi-
nant. This is particularly so in trying to understand how these ideas are
propagated by international financial institutions.
It is this chapter’s contention that ideas centred around notions of what consti-
tutes ‘good governance’ have been promoted by the IMF as an ultimate attempt to
reconfigure territories in order to make them most attractive to international
capital. Michel Camdessus, former head of the IMF, was quite open about this,
asserting in 1998 that ‘in a world in which private capital has become more
mobile, there is mounting evidence that corruption undermines the confidence of
the most serious investors and adversely affects private capital inflows’. He also
made claims to a consensus over what such good governance was, saying that ‘a
broader consensus has emerged on the central importance of transparency and
good governance in achieving economic success’ (Camdessus 1998). Indeed, the
Hegemony, ‘good governance’ and the IMF 125
IMF’s own prescriptions for designing ‘good governance’ structures draw upon
what the body refers to as ‘broadly agreed best international practices of
economic management’ (IMF 1997a).
Currently, many of those state elites perceived to stand in the way of restruc-
turing and who flout the IMF’s concept of good governance, stand to lose out,
with loans from the body being withheld; the withholding of $53 million in aid to
Zimbabwe by the IMF in August 1998, after Mugabe’s government failed to meet
the organization’s demand for good governance, being a prime example.
Obviously, in discussing such issues one is not siding with tyrants such as Mugabe,
nor arguing for poor governance. However, it is important to make the link between
the recent emphasis on good governance within the IMF and how this informs its
lending policies, and the wider neoliberal agenda that ‘good governance’ advances.
The theoretical insights provided by neo-Gramscian scholars, particularly vis-à-vis
the role of ideas and the notion of hegemony, are utilized as a point of departure.
Hegemony and international relations

In Gramscian theorizing, hegemonic power is of a different type than that
usually associated with pure material dominance, and is linked to ‘intellectual
and moral leadership’ via ideology, which has the ‘same energy as a material
force’ (Gramsci 1971: 377). Whilst it is true that the dominant economic class
can (and does) exercise sheer coercive force, this factor does not solely account
for its control: alliances are required with other fractions if this is to be achieved
on a stable and lasting basis. Maintaining hegemony is dependent not only upon
exercising coercive power, but also by attaining consent by acting as the ‘moral’
leaders of society and framing ideational terms of reference. As Robert Cox
(1992a: 178–79) phrased it:
Hegemony derives from the ways of doing and thinking of the dominant
social strata of the dominant state or states insofar as these ways of doing
and thinking have inspired emulation or acquired the acquiescence of the
dominant social strata of other states. These social practices and the ideolo-
gies that explain and legitimize them constitute the foundation of the
hegemonic order. Hegemony frames thought and thereby circumscribes
action.
According to Cox, the essential function of international institutions is the justi-

fication and defence of a particular politico-economic project. In acting thus, they
promote certain values as being comparatively fixed and appearing as natural:
the rules and practices and ideologies of a hegemonic order conform to the
interests of the dominant power while having the appearance [italics added] of
a universal natural order of things which give at least a certain measure of
satisfaction and security to lesser powers.
(Cox 1989: 825)
126 Ian Taylor
The achievement of the hegemony of a particular set of ideas is dependent

upon their success on a broader ideological battleground, limiting the bound-
aries around which ‘legitimate’ and ‘realistic’ policies may be formulated. In this
light, international institutions are the amalgamation of material and ideological
impulses: ‘the aggregations of influence on issue-areas which far overflow their
own institutional boundaries’ (Cox 1980: 393). This process is facilitated by
international financial institutions (IFIs) (among others) who, whilst co-opting
national elites in the periphery, also possess the strength to assimilate opposing
(counter-hegemonic) positions.
This assimilation, in a Gramscian sense, takes on the form of a passive revolu-
tion whereby particular elites (in this case, those sympathetic to neoliberalism –
money capital and outward-oriented fractions) attain power without rupturing the
existent social fabric. This trasformiso (‘transformism’) serves to absorb possible
counter-hegemonic elements into the dominant elites (in a globalized world, the
transnational elites) through a process of compromise and amalgamation. Such
passive revolution heads off counter-hegemonic impulses, integrating such
elements into the broader consensus. ‘Individual political figures … are incorpo-
rated individually into the conservative-moderate “political class” (characterised by
its aversion to any intervention of the popular masses in state life, to any organic
reform which would substitute a “hegemony” for the crude, dictatorial “domi-
nance”)’ (Gramsci 1971: 58). The agency of Southern elites in this process is quite
apparent.
In his analysis of modern Africa, Bayart demonstrated that postcolonial
Africa was marked by passive revolutions which co-opted potential opponents
into the broader historic bloc (Bayart 1993: 274). This process of fusion in
Bayart’s concern is local: it can, however, be extended to the global, whereby a
nascent historic bloc has formed. This has achieved a consciousness with a
recognition of the mutual interests upholding the on-going system, and which
allows certain elite fractions to prevail as ascendant. How this relates to the
global power structures is captured by Cox (1999: 12):
There is something that could be called a nascent historic bloc consisting of

the most powerful corporate economic forces, their allies in government,
and the variety of networks that evolve policy guidelines and propagate the
ideology of globalisation. States now by and large play the role of agencies
of the global political economy, with the task of adjusting national economic
policies and practices to the perceived exigencies of global economic liber-
alism. This structure of power is sustained from outside the state through a
global policy consensus and the influence of global finance over state policy,
and from inside the state from those social forces that benefit from globalisa-
tion (the segment of society that is integrated into the world economy). …
Neo-liberalism is hegemonic ideologically and in terms of policy.
Following this, ‘the precondition for the achievement of a hegemonic world

order is the construction of strong international regimes’, which is facilitated by
the regulative effect of international organizations (Gale 1998: 274). The actors
in this process are the dominant elites at the centre, who extend their conception
of social and political order to the international and transnational level by
exporting their preferred societal model through international institutions. These
institutions then act as socializing agents of change, helping to draw in partners
who share a particular worldview. Local elites come to share in the social values
of the dominant core elite, as such interests consolidate their own class position
at home.
In the current world order, with its shift from the Keynesian compromise to
neoliberalism, there has been a
transnational process of consensus formation among the official care-

takers of the global economy. This process generates consensus
guidelines, underpinned by an ideology of globalization, that are trans-
mitted into the policy-making channels of national governments and big
corporations.
(Cox 1996: 301)
The active intervention by international institutions favourable – if not integral –

to neoliberalism is profoundly important in this respect. A clear example of this
was the role of the IMF in the aftermath of the crises in Asia, where, according
to critics,
many of the adjustment packages [of the IMF] are thought to have gone
beyond traditional structural reform strategies, designed not only to restore
stability to the regional financial markets and to reform banking sectors, but
actually to contest the nature of the political process.
(Higgott 2000: 259)
This activity was frequently portrayed as ‘bailing out’ or ‘saving’ whole

nations from economic and social disaster. Immensely powerful multilateral
bodies such as the IMF actively propagated particular ideas in a quest to restruc-
ture the developing world and defend sectional interests. How these activities
have been centred around particular notions of what constitutes ‘good gover-
nance’ is what we turn to next.
The IMF and ‘good governance’

It is via interventions, negotiations, conditionalities, the making of concessions
and the arrival at ‘consensus’ that paramount sectional interests are able to be
displayed as the common interest. Increasingly, the IFIs have advanced ‘good
governance’ as a concept bound up with the normative framework of neoliber-
alism. According to Keet, by pushing a particular vision of governance, the IMF
and World Bank express
128 Ian Taylor
a clear bias towards the assumption that it is free market governments with
sound macro-economic policies which are more reliable. … There is also a clear
inclination to emphasise, or even equate good governance with the technical
qualities of efficient management and the main accountability of client
governments to funders/creditors and other external agencies.
(Keet 2000)
The International Monetary Fund (IMF), and the World Bank, were origi-
nally formed at Bretton Woods in 1945 as twin pillars in the post-war capitalist
dispensation (see Helleiner 1994). The World Bank’s role was to promote post-
war reconstruction, whilst the IMF was conceived as the protector of the
capitalist global economy, promoting international trade and regulating national
exchange rates. The value of cooperating currencies was secured to the dollar
whilst the American bank of issue promised to exchange dollars for gold.
Concurrently, dealing in currencies was regulated by official exchange controls,
thus fostering currency stability and allowing states to effectively plan their
economies. In addition to this surveillance role, however, the IMF also took on
providing short-term financing to states experiencing currency problems and/or
failing to satisfy their trade obligations. It is important to note here that the insti-
tution’s role then was to provide temporary liquidity to existing economies,
rather than trying to restructure them.
A more limited role for the IMF was very much in line with the ideological
underpinnings of the post-war capitalist world order, whereby various Keynesian
welfare nationalist schemes established a tacit consensus by which the system was
managed (Marglin and Schor 1990). During a period of unprecedented stability
and growth, the ideas and institutions that fostered this order remained essen-
tially harmonious and acted to bind together a strong working alliance between
the elites in Washington, the NATO states, and Tokyo – a trilateral cooperation.
This alliance emanated from the core state, the United States, and can be seen as
an international historic bloc, which in turn cemented the post-war international
economic order that became known as Pax Americana (Gill 1990a: 97).
However, dependent as it was on American largesse, this order began to
unravel once Washington sought to stem the growing negative effects on its
economy brought about by a decline in productivity growth and its competi-
tiveness. Furthermore, an increasingly transnationalized capital began to see
such restrictions as a dampening device on their profitability and ‘freedom’,
and began pushing for a re-negotiation of the post-war consensus. Nixon’s
suspension of the convertibility of the dollar into gold and the setting of
exchange rates based on market valuations, plus the imposition of import
surcharges by Washington, rapidly forced an adaptation by the rest of the capi-
talist trading states. As a result, the world monetary system relied on a dollar
(not gold) standard. An inflationary macro-economic policy served to share the
costs of America’s expensive adventurism in Vietnam, achieved through a
devaluation of the dollar and a depreciation of external dollar-denominated
holdings.
These policies brought on a profound recessionary wave throughout the capi-

talist world that lasted into the 1980s, and a crisis in the consensus that had
characterized the global order. All previous assumptions about the organizing
precepts of society were questioned. The post-war compromise was attacked in
both senses of the term: the domestic compromise which tied in labour and
welfare interests; and the international compromise of mediating between
national interests and the global order.
For the IMF, these events were of profound importance. Indeed, it is true to
say that in the early 1970s, with the demise of regulated exchange rates, the IMF
‘lost’ its main raison d’être. This has provoked a constant re-invention by the IMF
– to find a new role, if not justify its very existence. This has increasingly stimu-
lated the institution to involve itself in affairs that are beyond the remit of its
original mandate – to indulge in ‘mission creep’. According to one analysis:
This has been done with grave consequences: the IMF, staffed with macro
economists, does not have the expertise to provide the kind of advice that it
is dispensing today. Nor is the IMF, which has no independent evaluation
unit and has been labelled one of the most secretive public institutions in the
world, held accountable for the policy advice that it gives.
(Welch 1998)
This is of fundamental importance, for the IMF is one of the sites of a

transnationalized ruling elite. Organizations such as the IMF have been at the
forefront of an intense reappraisal of the role of the state and the suitable levels
of public and private involvement in the economy. Essentially, this has been an
attempt to contest the Keynesian project and, wherever feasible, to discard it.
This project has been a struggle not only for pure power, but also for popular
authority. In short, it has been a struggle for hegemony. Such a process has been
conducted by a powerful phalanx of social forces, arrayed behind the agenda of
intensified market-led globalization, who sought to actively promote the post-
Keynesian counter-revolution.
For its part, the IMF began to emerge as a particularly important player in
the propagation of ideas surrounding governance and in restructuring national
economies, particularly in the South. This was facilitated first by the debt crisis
of the 1980s, which saw the IMF emerge as the lender of last resort; and second
by a resurgence of interest in the capitalist heartland in promoting liberal
democracy in the developing world. At the same time, there was concern that
the structural adjustment programmes that had attempted to reconfigure the
South had been hampered, if not sabotaged, by ‘poor governance’. As George
and Sabelli (1994: 142) assert:
If sustainable poverty reduction turn[ed] out to be just another mirage,

institutional responsibility for failure must not be seen to be the fault of the
[international financial institutions]. The only other possible culprits [were]
the [IFIs’] partners. …
130 Ian Taylor
Governance provide[d] a new tool-kit, an instrument of control, an addi-

tional conditionality for the time when the traditional blame-the-victim
defence again becomes necessary. It further offer[ed] the opportunity both
to instil Western political values in borrowing countries and to fault them if
things go wrong.
Instead of questioning their own prescriptions, the IFIs instead sought to

advance ‘good governance’ as a necessary precondition for neoliberal reforms to
finally work. This in itself reflected the conviction amongst the institutions that
neoliberalism was the only way forward, and that what was wrong, or had been
going wrong, was not the ingredients of the adjustment programmes, but rather
their implementation and wider institutional setting in the borrowing states. The
World Bank took the lead in this new approach, with its report in 1989 entitled
Sub-Saharan Africa: From Crisis to Sustainable Growth (World Bank 1989b). This report
took a more holistic view than previous Bank documents, and argued that institu-
tional change was necessary if reforms were to be effective. Not only did the Bank
argue that governments should be rolled back, but also that what government
remained had to be better administered along lines favoured by international
capital. The report also argued that what was characterizing the economic crisis in
Africa was not unequal trading relations with the North, or massive debt, or the
negative effects of liberalization, etc., but rather a ‘crisis of governance’ (ibid.: 60).
A number of subsequent reports by the Bank continued with this theme,
linking good governance and notions of liberal democracy with economic devel-
opment (cf. World Bank 1991; 1997b). What was being advanced were particular
ideas on how best to implement neoliberal restructuring, maintaining a core state
apparatus to push through liberalization. This project combined coercion and
consent as integral parts of the neoliberal push, wrapped up themselves within a
broad liberal capitalist ethos (see Williams and Young 1994). Indeed, good gover-
nance was advanced as ‘necessary for the creation of the consent for the new
order which structural adjustment could not usher in; and, unsaid, is also needed
to implement a sufficient quota of repression as the still unchanged policies of
neo-liberalism are implemented’ (Bernstein 1990: 23).
Although such ideas were outside of the IMF’s actual remit, the Fund also
began to take an increasing interest in good governance. In September 1996 a
declaration entitled Partnership for Sustainable Global Growth was adopted by the
IMF’s Interim Committee, and in August 1997 a report, promulgated by the
IMF’s Executive Board, asserted that IMF must henceforth assist member coun-
tries in creating systems that ‘limit the scope for ad hoc decision making, for rent
seeking, for undesirable preferential treatment of individuals or organizations’.
The IMF now boldly stated that it was ‘legitimate to seek information about the
political situation in member countries as an essential element in judging the
prospects for policy implementation’ ( James 1998: 35).
The ability of the Fund to advance its new ideas on governance was consider-
ably compounded by the structural features of the global economy. As one analysis
asserts, the power of the IMF over developing countries ‘was made all the more
formidable since, in the aftermath of the debt crisis, all other potential sources of
credit, bilateral or otherwise, required an IMF stamp of approval … before any
credit was extended’ (Adams 1997: 162). Developing countries increasingly
required the IMF’s approval in order to secure new aid flows in order to help avoid
defaulting on outstanding loans. Obviously, this gave the IMF an amount of influ-
ence over the economic policies of debt-ridden administrations. State
administrations were repeatedly ‘advised’ that economic recovery was dependent
upon what was vaguely termed ‘business confidence’, and that this in itself hung
on a disciplined labour force and a state that pursued ‘good governance’.
Such advice has been part and parcel of the Structural Adjustment Facility
(SAF) and Enhanced Structural Adjustment Facility (ESAF) loan programmes of
the institution. The conditions attached to such loans can include the disman-
tling of labour regulations, increasing foreign investment incentives, and
privatization schemes. Yet such conditionalities and negotiations between the
IMF and the host state frequently present what are essentially the interest of
particular fractions, both national and international, as being in the interests of
the wider populace. Concessions, such as the (limited) advancement of what are
termed ‘social issues’ allow the IMF and the negotiating state parties to pass off
conditionalities as being concerned with protecting the poorest. O’Brien et al.
(2000: 178) remark that such interventions allow the IMF to cast general interests
as paramount, thus strengthening the legitimacy of IMF prescriptions and main-
taining political support for them. One such tactic is to stress ‘ownership’ of IMF
prescriptions by implementing states and to portray IMF strictures as being
voluntarily followed by administrations pursuing the general interest:
[M]anagement and staff at the IMF have gone some way to accepting the
importance of ownership, at least in so far as it may be an indispensable
ingredient for successful policy implementation. …
That said, the change in rhetoric has not to date always translated into
substantially different behaviour at the Fund. … For the IMF, ‘ownership’
has tended to mean acceptance by the borrowing government and its citi-
zens of Fund prescriptions. As one official has typically put it, ‘we have to
persuade the population that an adjustment package is legitimate’.
(O’Brien et al. 2000: 187)
One way this has been done is for the IMF to move even further beyond its
original mandate of facilitating short-term loans. Previously, it is true that the
institution provided varying degrees of technical advice and assistance, often
with conditionalities attached. However, traditionally the IMF’s main focus was
on encouraging administrations to ‘correct’ macroeconomic imbalances, reduce
inflation, and embark on reforms amenable to the private sector. We can call this
process ‘first stage restructuring’, referring to the package of measures adopted
at the behest of the IFIs to open up domestic markets.
The IMF has increasingly promoted ‘second stage restructuring’ (centred
around the ideas of ‘good governance’), after it became apparent that much of
132 Ian Taylor
the initial restructuring programmes were not working. Pinpointing exactly when
this occurred is problematic, but according to one source,
through 1982, less than 5 per cent of [IMF] upper tranche arrangements
contained more than 11 or more performance criteria [i.e. conditionalities
related to governance]. By the end of the decade, more than two thirds of
such arrangements had 11 or more criteria.
(Kapur and Webb 2000: 2)
Conceptually, poor governance has been blamed as a central problem. Current

IMF policy is designed to lock-in administration to the liberalization process, whilst
at the same time giving the reforms legitimacy based on liberal legal principles. As
an IMF document asserts, ‘the IMF has found that a much broader range of insti-
tutional reforms is needed if countries are to establish and maintain private sector
confidence and thereby lay the basis for sustained growth’ (IMF 1997b).
As mentioned above, in September 1996 a declaration entitled Partnership for
Sustainable Global Growth was adopted by the IMF’s Interim Committee in
Washington. This identified ‘promoting good governance in all its aspects,
including ensuring the rule of law, improving the efficiency and accountability of
the public sector, and tackling corruption’ as a fundamental element of a restruc-
turing framework. This process was rapidly followed by a ‘Guidance Note’,
which was adopted by the Board in July 1997 (IMF 1997b). According to this
Note, the IMF took on responsibility for two spheres:
• improving the management of public resources through reforms covering

public sector institutions (e.g. the treasury, central bank, public enterprises,
civil service, and the official statistics function), including administrative proce-
dures (e.g. expenditure control, budget management, and revenue collection);
• supporting the development and maintenance of a transparent and stable
economic and regulatory environment conducive to efficient private sector
activities (e.g. price systems, exchange and trade regimes, and banking
systems and their related regulations) (IMF 1997a).
It rapidly became apparent that the IMF saw good governance as a corner-
stone in its new reconfigured mission, and that adherence to the ideas not
promoted by the institution was not an option for administrations seeking IMF
largesse. The IMF Director Michel Camdessus went so far as to warn state elites
that ‘every country that hopes to maintain market confidence must come to
terms with the issues associated with good governance’ (IMF 1997b).
Problematizing and explaining the rise of good

governance ideas
There are four essential problems with the current emphasis on good governance:
who is advocating it; how; what exactly constitutes good governance; and whose
interests does it serve? Obviously, tackling issues of corruption, transparency and

mismanagement is not a bad thing in itself and is a highly positive and lofty prin-
ciple. However, conferring the IMF with the ability to determine what constitutes
good governance, and the power to implement such prescriptions onto sovereign
states is profoundly problematic. As one analyst writes, it further legitimizes the
IMF’s power grabs of the last several decades and entrenches the IMF in the posi-
tion of giving development and stabilization advice even when its qualifications are
highly dubious (Welch 1998). Collier comments that
the extension of the practice of conditionality from the occasional circum-

stances of crisis management to the continuous process of general economic
policy-making has implied a transfer of sovereignty which is not only
unprecedented but is often dysfunctional, particularly as such conditionali-
ties lacked moral legitimacy.
(1999: 319–20)
Indeed, given the IMF’s history, it is correct to be suspicious of the new-found

principles supposedly governing the institution’s lending operations. One need
only remember that it was the IMF who advanced over US$1 billion to Mobutu
Sese Seko in Zaire to realize that good governance has not always been high up
on the list of concerns for the institution. Numerous countries, particularly in
Africa, continued to receive IMF assistance long after the corrupt nature of their
state polities was blatantly apparent. And then of course, the US$11 billion loan
to Russia in July 1998 (over and above an already existing $10 billion loan) was
approved in spite of the rotten nature and overtly corrupt practices of the
Russian elites. Clearly, good governance principles, despite claims to the contrary
in Washington, have never been a priority for the IMF, and in fact the institution
has been complicit in many highly dubious activities and with many suspect
administrations (Chossudovsky 1998).
What then explains this shift in ideas? Are such new ideas really new, or are
they other means to help reconfigure the South? Central to any analysis is the
ongoing process(es) of globalization and the hegemony of neoliberal ideas, whose
architects require a universal vision, a picture of a globally conceived

society, to join classes in different countries … [in order] to institutionalise
global capital accumulation by setting general rules of behaviour and
disseminating a developmentalist ideology to facilitate the process.
(Mittelman and Pasha 1997: 51)
These rules of behaviour reflect the second stage of capitalist restructuring that
has already been mentioned, as state elites in the periphery are encouraged to
lock-in the liberalization process by enacting good governance prescriptions that
serve to isolate, and at the same time legitimize, economic reforms along neoliberal
lines. This process is not simply a top-down activity that strips Southern elites of
their agency. Indeed, circumstances may actually mean that liberalization and the
134 Ian Taylor
selling-off of public enterprises may serve the interests of entrenched elites and
their local and international class allies. In this sense, good governance rhetori-
cally advances ‘common sense’ notions of governance by promoting sectional
interests as the common interest and by appearing to be reasonable and beyond
reproach, whilst actually covertly advancing liberalization. The good governance
project is a highly effective strategy. As George and Sabelli remark, ‘being
against good governance is like being against motherhood and apple-pie’, yet the
IFIs’ definition of governance ‘nicely circumvents the issue of politics by
focusing on … the solely economic’ (1994: 150).
According to Gill, the locking-in of reforms and the granting of legitimacy is
at the heart of ideas surrounding new constitutionalism and good governance
issues as propagated by disciplinary international institutions (Gill 1998). Good
governance ideas can be seen as a means to ‘reformulate and redefine the public
sphere and rules for economic policy, according to orthodox market-monetarist
postulates in macroeconomics (fiscal and monetary policy) and microeconomics
(e.g. trade, labour market and industrial policy)’ (ibid.: 30). They serve as the
vanguard in the second stage of neoliberal restructuring, further acting to lock-in
domestic elites, whilst at the same time bolstering the position of those fractions
sympathetic to an increasingly cohesive transnational neoliberal power bloc. It is
this which has been instrumental in efforts to create a mode of international
economic policy coordination which is intended to ensure the coherence and
stability of a new transnational accumulation regime.
Though there is, to be sure, a large degree of top-down coercion involved in
this restructuring process, consensual elements are present, particularly on the
part of the outwardly oriented fractions of capital in states in the periphery, as
well as their elite allies within the state administrations. In this sense, the promo-
tion of good governance can also be seen as an attempt to formulate and
reformulate hegemony at the local level around neoliberal ideas, and is not a
process devoid of agency on the part of Southern elites. Good governance ideas,
as they are currently configured, may be seen as attempts to reconstruct hege-
mony through a reformulation of the mode of political rule: from the unstable
and unpredictable to one that is most attractive to international investors.
Whilst the implementation of structural adjustment programmes may erode
legitimacy in the eyes of some, the turn to ‘clean government’ does help amelio-
rate negative pressures. After all, the state is supposedly operating a tight ship
and cannot be held accountable outright to dislocations that may occur – these
are the ‘natural’ workings of the market! In addition, the involvement of institu-
tions such as the IMF in promoting neoliberal ideas within borrowing states can
also act as a useful alibi to be deployed in defence of administrations that intend
to embark on neoliberal restructuring. As a Bank for International Settlements
report put it, ‘in many countries, explaining monetary policy decisions in terms
of external constraints has been helpful in securing public acceptance’ (Bank for
International Settlements 1992: 124).
Furthermore, by holding administrations accountable to good governance
strictures, institutions such as the IMF also avoid censure and can be actually
seen as allies of the downtrodden citizen – even whilst the IMF’s very policies
contribute to the further erosion of citizens’ livelihoods. Indeed, by advancing
the classical liberal separation of the political from the economic, good gover-
nance strictures serve to obscure the real problems regarding social and
economic power imbalances that characterize most states. By elevating good
governance prescriptions into legally binding guidelines, and by predicating
further funding on the compliance to such precepts, the IMF and other IFIs
bolster the position of the neoliberal-inclined elites.
Equally important, by advocating good governance, the IMF and other
intervening bodies help build up a considerable and influential support
constituency in civil society. As one analysis framed it, ‘local and foreign
NGOs, the media, religious institutions, chambers of commerce and
employers’ organisations quickly mesh together as a local network of non-
governmental bases of support to meet [the institution’s] objectives’ (Toissaint
1999: 149). This can be seen as part and parcel of ‘a global strategy to
promote Western values and institutionalise political regimes that are likely to
be non-belligerent and generally positive towards the realisation of the [neo-]
liberal paradigm’ (Hyden 1997: 236).
Conclusion
The promotion of certain ideas relating to good governance reflects develop-
ments within global capitalism in the era of globalization and where the
ideology of neoliberalism is hegemonic. Good governance is part of a broader
attempt to legitimize the political authority of liberalizing elite fractions in the
South. These ideas have been advanced by international financial institutions
such as the IMF as part and parcel of the neoliberal order. It is a reflection of
the success of neoliberalism as a hegemonic project that particular ideas of
‘good governance’ now appear to be common sense, if not unquestionable. The
incantations sounded by the organic intellectuals tied to this project whenever
criticism is raised make its almost hallowed status quite clear. Williamson’s
remarks in defence of the consensus give a taste of such reflexes, claiming as he
does, that neoliberalism is the ‘spontaneous, automatic expression of economic
facts’:
[T]he superior economic performance of countries that establish and main-

tain outward-oriented market economies subject to macro-economic
discipline is essentially a positive question. The proof may not be quite as
conclusive as the proof that the earth is not flat, but it is sufficiently well
established as to give sensible people better things to do with their time than
to challenge its veracity. … I find it ironic that some critics have condemned
the Washington consensus as a neo-conservative tract … I regard it rather
… as an attempt to summarise the common core of wisdom embraced by
all serious economists.
(Williamson 1993: 1330, 1334)
136 Ian Taylor
Having said this, the promotion by the IMF of good governance ideas must
be contextualized within a broader framework incorporating notions regarding
the power of ideas within international politics. In fact, it is accurate to say that
what the IMF and other disciplinary institutions are promoting is a form of
‘passive revolution’ that seeks to achieve the hegemony of neoliberalism. By
appealing to the rule of law and emphasizing safeguards for market reforms,
notions of governance more specifically related to liberalization, alongside issues
such as corruption, can be covertly ‘smuggled in’ and entrenched at a constitu-
tional and legal level, thereby locking-in administrations to the restructuring
process (Cutler 1999).
In essence, good governance promotion can be seen as an expansion of the
IMF’s mandate into the realms of advocating constitutional and legal safeguards
for transnational capital. In doing so, the harmonization of business practices is
the ultimate aim, but so too is the defence and enlargement of a project in
furtherance of a world-wide restructuring. In doing so, consent in supporting
many of the prescriptions of good governance – a supposedly universal and
‘neutral’ set of values – is equally as important as the more coercive nature of
institutions such as the IMF: ‘Since the ideological formation of hegemony is
necessary for the creation of consent, the reproduction of hegemony is dependent
… upon its ability to operate as a universal language’ (Keyman 1997: 117), so
that different interests belonging to different states are made compatible with one
another. The extent and form of IMF interventions of course fluctuates over
time and space, depending on the balance of class forces within each particular
state. Nonetheless, good governance has become what development and
modernization were two decades ago: a hegemonic discourse that seeks to allow
the North to define the South in its own image. This is not to say that compli-
ance with such governance strictures is automatic, and Southern elites have been
at times quite successful in ducking such prescriptions. But questions over
compliance or non-compliance to a degree miss the point. It is the legitimizing
function that strictures on governance perform, attached as they are to liberal-
izing projects, that makes such projects incredibly powerful. Such prescriptions,
even if ignored by the affected elites, serve to advance the idea that sectional
interests are actually general interests and that restructuring, however unpalat-
able to many on the ground, ‘at least’ brings with it conditionalities that may rein
in the corrupt rapacity of local elites, even if this actually does not happen.
Good governance projects then serve at one level to obscure the actual implica-
tions of neoliberal programmes, whilst dressing them up as good common sense
which may ameliorate the dire economic and political conditions of much of the
South. They act as a means of legitimization and socialization. In this sense, the
promotion of ‘good governance’ notions by bodies such as the IMF reflects the
potent role of ideas in international politics, and the part played by multilateral
institutions in such endeavours.
10 Balancing between East and
West
The Asian Development Bank’s policy
on good governance
Janne Jokinen
Introduction
This chapter looks at the Asian Development Bank’s (ADB) policy document on
good governance, with the purpose of clarifying how its contents were influ-
enced by the political and institutional environments within which it was created.
The analysis begins with a discussion on the factors that led to its creation. The
focus then shifts to the contents of the document: how do they reflect the ideo-
logical and political framework within which the Bank’s management functioned
in the early and mid-1990s when the policy document was drawn up? Two
themes are highlighted: the definition of the proper role of the state in develop-
ment, and the manner in which the policy on good governance is reconciled with
the ‘apolitical’ role of the ADB.
The policy on good governance was adopted because the major Western
donor countries wanted it. They were able to use the negotiations for the replen-
ishment of the Bank’s Ordinary Capital Resources (OCR) and the Asian
Development Fund (ADF) to persuade the opponents of the policy to accept it.
However, the policy was not just a product of the Western donors. Its contents
were influenced by Japan, which was strengthening the policy aspect of its devel-
opment cooperation in the late 1980s. The document was also modified to make
it palatable to the Developing Member Countries (DMCs) and ease its integra-
tion to the ideological framework of the Bank. Consequently, the ADB policy on
good governance differs in some important aspects from similar policies adopted
by other development agencies in the 1990s.
Background of the policy document on good

governance
In its introduction, the ADB policy document on good governance (ADB 1995)
gives two main sources for the policy: the international development debate of
the early 1990s, and the Bank’s internal discussion concerning the approaches,
priorities and objectives of its operational programmes. The international debate
referred to was the exchange between the proponents of the so-called
‘Washington Consensus’ represented especially by the United States,1 the World
138 Janne Jokinen
Bank and the International Monetary Fund (IMF), and the East and Southeast
Asian supporters of the ‘Developmental State’ model.2 The intensity of the
debate reached its peak at the same time as the policy document was under
preparation.
The question of what good governance is and how it should be operational-
ized in developing countries became a key bone of contention in the debate, as it
came to signify an extensive package of issues (see Bøås 1998). The Washington
Consensus advocated a limited economic role for the state, while supporters of
the Developmental State model argued for an active one. After the collapse of
the Soviet Union, the linkage to human rights and democracy gained in
emphasis. The relative merits of collective economic and individual political
rights were widely debated, as were those of authoritarian political systems
(‘guided democracy’) and liberal parliamentary democracy.
Japan’s position in the post-Cold War development debate was particularly
interesting because it was so ambivalent. Japan agreed with many of the argu-
ments of the Washington Consensus, but also sympathized with its opponents.
This was understandable, as it was Japan’s own post-Second World War develop-
ment strategy that had been refined into the Developmental State model. All the
main contenders were members of the ADB, and the Bank thus became an
important forum for the debate. Moreover, the ADB was at the time seeking to
broaden its role from that of a project financier to what it called a ‘broad-based
development institution’ (ADB 1998: 20–21). Whether or not the Bank should
promote good governance, and by what means, was closely connected with what
kind of an identity it was going to have in the future.
Contending visions: the Washington Consensus, the

Asian Developing Countries, and Japan
Since the 1980s, the Washington Consensus had been offering to developing
countries a policy package that consisted of privatization, liberalization and
democratization. Its vision was an idealized version of American society: a mini-
malist state based on the establishment and enforcement of property rights, the
rule of law, political democracy and individualistic economic transactions, as
well as a selective social safety net (Black 1999; Standing 2000).
Economic growth was the paramount goal. It was believed to be impossible
without the establishment of a free and open market economy that was based on
the rule of law. The new urban middle classes that would emerge as a result of
economic liberalization would not stand for any limitations on their personal
freedom and would pursue an American-style political system. The globalization
of the free market model would inevitably lead to the globalization of political
systems, values and cultures.
Among the most vocal Asian critics of the Washington Consensus were the
leaders of the People’s Republic of China (PRC), Senior Minister Lee Kuan Yew
of Singapore, and Prime Minister Mahathir Mohammad of Malaysia.
According to them, its ideas were not based on ‘scientific’ but ideological
The ADB’s policy on good governance 139
grounds. Behind the campaign for good governance they tended to see a plot to
keep Asian countries subservient to the West by undermining the strengths on
which their success was based: an active dirigiste state, and the placing of collec-
tive economic rights before individual political rights. The critics referred to
experiences from Africa and Latin America, where World Bank and IMF-
enforced Structural Adjustment Programmes (SAPs) had been applied since the
early 1980s with poor results. These programmes contained the same policy
package that was now offered to Asians (Zakaria 1994; Yasutomo 1995; Root
1996; Gwynne and Kay 1999).
The supporters of the Developmental State model emphasized that the role
of the state was crucial, especially in the initial phases of economic develop-
ment. Technological adaptability and the accumulation of capital would be
promoted by forceful policies, including protectionist ones. Public resources
would be applied pragmatically to search for and implement market-
augmenting and market-accelerating measures in cooperation with the private
sector. Only after domestic corporations, and the society at large, were strong
enough to withstand foreign competition in both home and international
markets would the national economy be gradually opened up (Yasutomo 1995;
Gore 1996). The rapid economic growth that first Japan and then several other
East and Southeast Asian societies had experienced in the 1970s and 1980s
was presented as evidence of the success of the Developmental State model.
Since the end of the 1970s, Japan had greatly increased its Official
Development Assistance (ODA). It had also become the largest creditor in the
world. At the end of the 1980s, Japan’s Asia policy changed. It redirected its
development aid to new recipients as a result of the ‘economic miracles’ that had
taken place in several countries that it had assisted in the past. At the same time,
Japan launched a campaign to match its political influence in international orga-
nizations with its financial contributions to them. A characteristically Japanese
ODA philosophy had to be created to provide a substantive basis for a more
prominent political role (Yasutomo 1995).
In the 1980s, humanitarianism and interdependence had been highlighted as
the rationales for Japan’s development assistance. In the post-Cold War era, the
efforts of aid recipients to strengthen democracy, human rights and the market
economy would be rewarded, while increasing military expenditures, develop-
ment of weapons of mass destruction and arms exports would result in the
reduction or discontinuation of assistance.3 These principles, together with envi-
ronmental concerns, were codified in the ODA Charter adopted in 1992
(Yasutomo 1995).4
Japan’s position in the international development debate became more
prominent at the beginning of the 1990s. At the same time, it moved closer to
the opponents of the Washington Consensus. At the World Bank, Japan ques-
tioned the neoliberal approach to development operationalized in the SAPs, and
sought the role of a mediator between the DMCs and the United States and
other Western donors (Yasutomo 1995).5
140 Janne Jokinen
The actors within the Asian Development Bank

The main contenders in the international debate were all members of the ADB.
The proponents of the Washington Consensus wielded a great deal of influence
over the Bank’s thinking. Most of the economists working there had been
educated in North American or British universities and adhered to the neoliberal
school of economics. The authority of the IMF in the governance of the global
economic system was largely unquestioned. The World Bank had close relations
with its Asian sister, sharing information and staff, and the ADB tended to follow
its lead in policy matters. The United States was the most powerful member
country at the ADB, and it was not afraid to use its influence to promote its own
interests (Kappagoda 1995).
At the end of the 1980s, opposition to the Washington Consensus gained in
strength at the ADB. The PRC became a member in 1986 and got its own
representative on the Board of Directors. It also soon became the largest
borrower. The Chinese had little time for free market ideologues. Moreover, the
first of the Asian ‘tigers’ – Singapore, Hongkong, Taiwan and South Korea –
shed DMC status and became donors themselves. Also Indonesia and Malaysia
made financial contributions to the Bank. The Southeast Asians matched their
economic success with increasing assertiveness in international affairs
(Kappagoda 1995).
Among the members of the ADB, Japan traditionally holds a special position.
Its voting power equals that of the United States. Moreover, the Japanese
Ministry of Finance (MOF) has provided the candidates for ADB presidency
since the Bank’s founding. Many other key positions in the ADB management
are filled by MOF personnel as well, and positions at the ADB have long been
considered almost an integral part of the career development of MOF’s interna-
tionally oriented officials. By the 1980s, many top MOF officials had an ADB
background and experience from the development of Asian societies, which they
could put to use, for example at the World Bank and the IMF (Yasutomo 1995).
Until the late 1980s, Japan maintained a low profile at the ADB. The execu-
tive directors representing Japan focused on supporting the president and rarely
disagreed with Bank management in public. Japan was also careful not to get
involved in political disputes with the United States, because it wanted to main-
tain at least the appearance of a balance between its own position and that of
the Americans to deflect accusations that the ADB was dominated by Japan.
However, towards the end of the 1980s, this policy began to change. Japan could
not hope to increase its influence in any other major multilateral development
institution because these were all controlled by the Americans and/or the
Europeans. Moreover, Japan was forced to adopt a higher profile at the ADB by
the United States’ open use of the Bank to implement its own political and ideo-
logical agenda, which the Japanese did not wholly share (Yasutomo 1995).
During the first years of the 1990s, the attitude of the United States towards
the ADB changed. The post-Cold War Bush and Clinton administrations
appeared to consider the Bank a relatively unimportant institution. Maintaining
security alliances in Asia at any cost was no longer felt necessary, and the focus
shifted to opening Asian economies for American exports and investments.
There was less need to channel money to Asian allies through the ADB. The
United States opposed the Fourth General Capital Increase of the Bank’s OCR
(GCI IV) and the Sixth Replenishment of the ADF (ADF VI), which were being
negotiated in the beginning of the 1990s. Japan reacted by redirecting its efforts
to keeping the Americans involved in the ADB, for example by serving as a
mediator between the United States and its opponents the same way as it had
done at the World Bank (Yasutomo 1995).
The ADB itself was undergoing deep-reaching changes in the early 1990s. Its
management was seeking to change the Bank into a ‘broad-based development
institution’, a move supported by many donors but opposed by some DMCs.
The Bank needed new resources from the donors for the replenishment of its
OCR and the ADF. Consequently, it had to adopt their agenda, in which good
governance was a key theme at the time. At the same time, the ADB manage-
ment had to make sure that its new identity would be acceptable to its powerful
DMCs as well.
The debate on good governance within the Asian

Development Bank
The opportunity for reforming the role of the ADB in the Asia-Pacific and for
defining what good governance would mean in an Asian setting was provided by
the negotiations leading to GCI IV and ADF VI. Several major donor countries
argued that, as a result of the ‘economic miracles’ in East and Southeast Asia, a
number of DMCs were no longer in need of ADB assistance – especially the
‘soft’ ADF loans – as they now had greater domestic resources and access to
international financial markets. Consequently, a GCI would only be justified if
the emphasis of the Bank’s operations moved from supporting economic devel-
opment as such to promoting institutional reforms and social development
(Kappagoda 1995; Bøås 1998).
Despite strong opposition from DMCs, the ADB pledged to use more
resources for social development and environmental protection programmes. It
also promised to emphasize the development performance of borrowing DMCs
as a criterion for the allocation of ADF resources, and to apply this criterion to
operations financed from OCR as well, when appropriate (Bøås 1998). Good
governance would be one element in measuring development performance
(ADB 1995).
The DMCs had consistently opposed considering development performance
in lending decisions. The use of good governance – including a democratic
mode of government and respect for human rights as criteria for measuring this
had been opposed even more vehemently (Kappagoda 1995). To assuage the
DMCs, the ADB emphasized that progress in good governance would only be
looked at in an economic context. Democratization and human rights were
excluded by the Bank’s charter (Bøås 1998).
142 Janne Jokinen
The same theme was picked up in an important report drawn up by the Task
Force on Improving Project Quality, which was completed in January 1994. The
Task Force stressed the importance of increasing DMC capacity for policy anal-
ysis, formulation and management, as well as strengthening the ‘ownership’ of
projects by executive agencies and potential beneficiaries. The Bank was to
encourage DMC governments to give up tasks that could be handled better by
the private sector (ADB 1994; 1995).
At the same time as the Task Force was winding up its work, the preparation
of the policy document itself was underway. This process was led by Dr Hilton
Root, who served as the Chief Adviser on Governance at the ADB from 1994 to
1997. He had previously worked as a consultant for the World Bank and the
United States Agency for International Development (USAID). Root borrowed
DMC and ADB staff, gathered the views of donors on governance, and
prepared a draft policy document to serve as a basis for discussion (Root 1996).
In April 1995 the ADB organized the Governance and Development
Workshop. It brought together experts who had been involved in drawing up the
development strategies of Hong Kong, Indonesia, Japan, the Republic of Korea,
Singapore and Taiwan. The workshop drew attention to the widespread impres-
sion in Asia that the existing definitions of governance reflected only the
experience and interests of Western countries, and did not take into account
Asian experiences. This despite the fact that in East and Southeast Asia, it had
seemingly been possible to create rapid economic growth through interventionist
industrial policies while maintaining equity and limiting the amount of bureau-
cratic corruption (Root 1996; Bøås 1998).
The participants of the workshop stressed that no standard measurement of
good governance should be adopted because each country had its own political
history, political system, institutional culture and level of development, none of
which could be accredited with a comparative advantage. Many institutional
alternatives permitted sound development management. The key issue was the
capacity to successfully implement economic and social policies. This depended
especially on the capability of state bureaucracy and the effectiveness of the
state/society interface.
The conclusions made at the Governance and Development Workshop were
taken into the policy document on good governance almost ad verbatim, which
made it acceptable to the DMCs (ADB 1995; Root 1996). The document was
brought to the ADB’s board of directors as a Working Paper in May 1995 and
formally adopted by the board the following October (ADB 1995).
The balancing act, part 1: the proper role of the state

in development
The ADB policy document on good governance is a balancing act in several
ways. It seeks to accommodate the interests of the donors with those of the
DMCs, Asian viewpoints with the Washington Consensus, economics with poli-
tics, the role of the state and its citizens with that of private enterprise, the
interests of domestic with those of foreign investors, and so on. The scales of this
balancing act are not equally weighted, however.
The policy document was drawn up and adopted because the Western donors
wanted it (ADB 1995; Bøås 1998). This is reflected in its contents, where stan-
dard arguments of the Washington Consensus are repeated. The document
concentrates on the role and practices of public authorities. Most reforms either
derive from, or aim at, increasing the role of domestic and foreign private enter-
prise in the national economy. Privatization and the integration of Asian
economies to the global marketplace are important objectives (ADB 1995; Bøås
1998). The overall goal of the policy seems to be to facilitate the transformation
of the institutions and practices of the borrowing DMCs so that they become
compatible with the values and practices of the North American and European
donors. The policy also seeks to make ADB investments in development projects
in the DMCs more cost-effective – a traditional donor concern (ADB 1995).
The objectives of the policy on good governance are clothed in economic
parlance to make it acceptable to DMCs and to reconcile it with the ADB
Charter. It is repeatedly stressed that the ADB is only concerned with ‘sound
development management’ – that is, the efficiency and effectiveness of the insti-
tutional environment within which citizens and corporations interact with their
government agencies and individual officials – and not with governance as
democratization or the strengthening of individual human rights. The document
argues that the Bank is not interested in the specific sets of economic policies
DMC governments are pursuing, let alone their political systems; the Bank’s sole
concern is that those policies have their desired effects (ADB 1995).
As its point of departure, the policy document takes the definition of the term
‘governance’ from Webster’s New Universal Unabridged Dictionary of 1979: ‘the
manner in which power is exercised in the management of a country’s economic
and social resources and development’ (ADB 1995).6 Based on this definition
and a World Bank discussion on the matter,7 the ADB describes governance as
being directly concerned with the management of the development process. It
encompasses the functioning and capability of the public sector, as well as the
rules and institutions that create the framework for the conduct of both public
and private business. Accountability for economic and financial performance,
and regulatory frameworks relating to companies, corporations and partnerships
also fall under the term ‘governance’ (ADB 1995).
The policy document seeks to deflect DMC misgivings by stating that Asian
experiences have shown that there is no direct correlation between the political
environment and rapid economic and social development; democracies have
fared no better than non-democracies in terms of good governance (ADB 1995).
The ideological orthodoxy of the document is confirmed by the argument that,
generally speaking, the market mechanism is to be preferred to state direction:
markets allocate resources more efficiently than governments because the latter
have limited access to information (ADB 1995).
The state can best carry out its tasks by concentrating on guaranteeing a ‘level
playing field’ for private actors. Equity can be safeguarded by maintaining the
144 Janne Jokinen
mobility of factors of production, free flow of information regarding prices and

technology, and competition among buyers and sellers. Taxation and public
spending are also needed but should be applied in moderation. Cost recovery of
public services should be increased by adopting user fees and discontinuing
subsidies for low priority activities (ADB 1995).
The ADB policy document on good governance thus provides the model for
the proper functions of the state. This conflicts with the claim made elsewhere in
the document that the Bank will not identify specific criteria for government
action because it would be impossible to choose the right ones – East Asian insti-
tutions, although different from Western ones, have proven to be just as effective
in bringing about economic development. The Bank promises that it will not
force the DMCs to change their institutions. This is done to deflect the accusa-
tion that it is attaching political conditions to its lending, which is forbidden by
the charter. The promise is undermined, however, by the policy on good gover-
nance itself, and the commitments the Bank made to donors in connection with
GCI IV and ADF VI (Wilson 1987; ADB 1995).
The principles of public administration

The main focus of the ADB policy document on good governance is on what
constitutes proper public administration, or ‘sound development management’.
The document follows the categorization adopted by the World Bank: account-
ability, participation, rule of law – interestingly renamed in the ADB document as
‘predictability’ – and transparency. In short, accountability refers to making public
officials answerable for government behaviour and responsive to the entity from
which they derive their authority; participation implies that stakeholders – those
affected – have access to public institutions that promote development, and are
able to influence the design and implementation of their activities; predictability
refers to the existence of laws, regulations and policies to regulate society, and to
their fair and consistent application; and transparency refers to the availability of
information to the general public and clarity about government rules, regulations
and decisions (ADB 1995).
The policy document suggests ways for operationalizing the four elements.
Improving accountability means strengthening government capacity for public
sector management, public enterprise management and reform, and public
financial management, as well as civil service reform. Increasing participation
means making the public sector/private sector interface more efficient and
decentralizing public and service delivery functions, as well as closer cooperation
with NGOs. Enhancing predictability can be done by strengthening legal frame-
works, especially for private sector development. Transparency can be improved
by widening the disclosure of information (ADB 1995).
Although the policy document states that the primary responsibility for
deciding on the direction and contents of public sector reforms is with the
DMCs themselves, it does present a ready agenda for them to follow. The
emphasis is on scaling down the state’s involvement. The preconditions of
success are government commitment to improving public sector operations, and

movement towards a macroeconomic and sector policy framework that includes
trade liberalization and exchange rate decontrol, as well as market-oriented
interest rates and other basic prices in the economy (ADB 1995).
The policy document defends this approach by appealing to dispassionate
reasoning: downsizing the public sector ‘may not be an end in itself, but is likely
to result from an unbiased examination of which goods and services are
provided better by private institutions’ (ADB 1995: 18). The document does
allow some leeway in the privatization process, but argues that the autonomy
from public authorities of those public enterprises deemed worth maintaining
should be increased in the name of efficiency. At the same time, their account-
ability to these same authorities should be enhanced (ADB 1995).
Civil service reform is approached from the same perspective: the key issue is
strengthening the confidence of the private sector in DMC economies. A profes-
sional and accountable civil service that can administer rules, maintain standards
and competition, and respect property rights is necessary for this purpose. The
policy document argues that market-friendly reforms are by nature likely to have
a beneficial impact in this respect because decreasing the discretionary powers of
officials leaves less space for corruption (ADB 1995).
In addressing the issue of participation, the focus is on the public
sector/private sector interface and boosting the role of the latter in the economy.
Market-friendly reforms are needed to release the energies and dynamism of the
private sector. Consultative mechanisms are needed to provide a voice in public
sector policy making, and to serve as safeguards against corruption. The policy
document recognizes that involving all stakeholders – not just representatives of
the private sector – in policy making will increase the effectiveness and account-
ability of development activities by providing governments with information
concerning the needs of the people and different social groups with means for
protecting their rights. Cooperation with NGOs, however, is considered to be
potentially useful but risky because these may have political agendas, lack formal
structures and accountability, have problems with continuity due to financial
constraints, and want to maintain their independence by staying within the
informal sector (ADB 1995).
The balance struck in the discussion on the proper role of the state in the
development of a society is skewed. Recommendations correspond to the views
of the Washington Consensus. The language used is that of (neoliberal)
economics, although the issues dealt with are social, political, even cultural in
nature. There is little in the document that would appeal to civil society activists
or the proponents of the Developmental State model.
The balancing act, part 2: the Asian Development Bank

as an ‘apolitical’ institution
Great efforts are expended to make the ADB policy document on good gover-
nance appear a ‘technical’ document. The political nature of its contents is
146 Janne Jokinen
made clear, however, by simply listing the topics that it deals with: the proper
role of the government in society, the policies that flow from this role, the prin-
ciples according to which state administration should be ordered, and the
ADB’s role in moulding DMC societies according to the model defined in the
policy. Although the document maintains that it is only concerned with ‘sound
development management’, which sounds ‘scientific’ and non-controversial, it
is actually concerned with the way societies organize themselves. The use of
economic parlance, and promises to act only at the request of the DMCs,
appear already in the Bank’s charter. The ADB was created in 1966 to change
(‘develop’) Asian societies, but given the image of a bank, an institution that
was considered to be apolitical by the founding fathers and thus acceptable
even to the newly independent DMCs that were sensitive about their
sovereignty.8
The point of departure adopted by the policy document on good governance
is the definition of governance as the manner in which power is exercised in the
management of a country’s resources and development. However, the political
aspects of governance are immediately discarded. The document does recog-
nize, for example, that making participation more effective may have a positive
impact on democratization or individual political and human rights, but
promises that the Bank will not directly support such goals (ADB 1995).
According to the policy document,
the Bank will steer clear of overtly political goals, such as parliamentary
democracy and human rights (however desirable these may be, for their own
sake). That being said, however, it also needs stressing that, in many ways,
the Bank’s operations are conducive, albeit indirectly, to the pursuit of these
goals (e.g. through wider participation in development activities, raising
living standards, expanding access to public goods and services, women in
development). Hence, though the charter provisions explicitly preclude any
role for the Bank in the political aspects of governance, efforts to enhance
the quality of economic governance in DMCs (i.e. management of
resources for development) could well redound to the benefit of the former.
(ADB 1995: 14)
The ADB policy document focuses on the role of the state, and says little on
good governance practices in the private sector. The reason given is that the
Bank has more experience of dealing with governments and thus more insights
to offer to them than to private corporations (ADB 1995). However, one is
tempted to see also another, ideological motivation for concentrating on the
state. In the neoliberal economic development discourse of the 1980s and the
1990s, the state and public agencies were seen mainly as the problem, obstacles
to development, while the market and private economic actors were believed to
be the solution and agents of development. This view is repeated in the ADB
policy document on several occasions, for example when the proper functions of
the state are discussed (ADB 1995).
The economic-vs.-political debate goes to the very heart of what multilateral

development institutions are and what they do. This debate intensified in the
1990s as their practical mandates expanded to new social and environmental
fields. The ADB was no exception. It sought to move away from the old role of
‘project financier’ and towards the role of a ‘broad-based development institu-
tion’. The adoption of the policy on good governance was one step in this
process (ADB 1995).
The troublesome aspect in this shift was the fact that the ADB and other
multilateral development banks (with the exception of the European Bank for
Reconstruction and Development, which was set up in 1991 as a catalyst of both
economic and political change in Central and Eastern Europe) were founded as
‘apolitical’ institutions. Their charters contain clauses which limit them to
economic considerations and activities. In the case of the ADB, Article 36 of the
Agreement Establishing the Asian Development Bank decrees that the Bank is to be free
from ideological and political considerations and influences, should only pay
heed to economic considerations, and engage only in economic activities (ADB
1966: art. 36).9 The policy document on good governance makes great efforts to
defend the broadening of the ADB agenda, and to dispel any impression that the
policy might be in conflict with the charter.
In particular, the term ‘economic considerations’ has been widely interpreted
by the Bank. A narrower definition of the term would exclude the Bank from
engaging in the programming considered most important by some of its
members, for example programmes that focus on the environment, education
and the position of women. According to the ADB, while such programming
may be viewed as social, the Bank finances it on the grounds that it has direct
links to economic development. Therefore, while Article 36 prevents certain
types of political activities, it does not prohibit the Bank from taking into
account demonstrable and direct economic effects of non-economic factors as
part of economic considerations (see ADB 1995).
These verbal gymnastics are necessary to allow the Bank to reconcile a docu-
ment it cannot alter, its charter, to a changing operational environment. On the
one hand, the ADB is forbidden to work towards anything but economic objec-
tives – on the other, it is required to do so. It therefore needs to reinterpret the
concept ‘economic’ in a way that satisfies the donors but does not threaten the
ADB Charter or the sovereignty of the borrowing DMCs.
The real impact of the policy on good governance becomes clear when its
application as a tool for measuring the success or failure of DMCs is taken into
consideration. Donors have been keen on controlling the way the money they
have contributed is used, and have been ready to punish or reward recipients
according to their success in fulfilling the conditions placed on lending, whereas
DMCs have generally opposed them (Kappagoda 1995; Bøås 1998).
In fact, political conditionalities – covert as well as overt – have never been
absent from bilateral development cooperation, and many countries routinely
use their assistance as a foreign policy tool. However, for multilateral develop-
ment institutions such as the ADB the issue is more controversial. Although the
148 Janne Jokinen
Bank has traditionally maintained that it does not subject its lending to political
conditionalities, and has used this argument to ward off pressure from donors,
this has never been strictly true even before the 1990s (Kappagoda 1995).
The concept of ‘economic considerations’ can be quite flexible, as the policy
document on good governance shows. Moreover, the shift in the Bank’s opera-
tional strategy from projects to programmes, sector activities and policy dialogue,
together with the emphasis of its development ideology moving from the devel-
opment of physical infrastructure towards social development, increased its
policy making role in the DMCs. The use of development performance as a
criterion for lending potentially made its influence even more tangible in the
smaller DMCs who are dependent on external assistance.
Conclusion
The ADB was the first multilateral development bank to adopt a policy on good
governance. There are several reasons for this. The Bank was a key forum where
supporters of the Developmental State model and supporters of the Washington
Consensus were present and able to argue their cases. At the beginning of the
1990s the ADB was in need of additional resources. This provided the opportu-
nity for donors to call for the adoption of the policy in return for new
contributions. The DMCs and the Bank’s management were forced to give in
but were able to influence the contents of the policy. In creating the consensus,
the mediating role of Japan was important. The result was the balancing act that
the ADB policy document on good governance represents: terminology
borrowed from the Washington Consensus and neoliberal economics to give the
Western donors what they wanted, but with a redefinition of key concepts, as
well as an emphatic restatement of the ‘apolitical’ role of the Bank to protect the
integrity of its charter.
The way in which the proper role and functions of the state in a developing
country are defined provides an example of one of the balancing acts. The
document does suggest a model that the DMCs are to apply if they wish to
achieve development in the most effective way possible: the one promoted by the
Washington Consensus. However, the document notes the value of Asian experi-
ences and states that each society should find its own solutions to good
governance. Furthermore, it is repeatedly promised that the ADB will not force
reforms on the DMCs, but will act only if and when they want its advice.
This does not change the fact that the policy document provides only one set
of solutions that the ADB is to promote. The real significance of the policy
becomes clear when its role in lending decisions is considered. The DMCs will
be rated according to their success in following the guidelines of the policy, and
those who fail to meet the requirements will have difficulties in getting loans in
the future. For those developing countries that depend on ADB assistance, this is
a powerful inducement to conform.
What, then, is the role that the ADB is playing in the DMCs? The Bank has
always treasured the self-image it has derived from its charter: an impartial, tech-
nical institution working objectively to assist its DMCs in their economic devel-
opment. It lends money to worthy causes but it leaves the social and political
effects of projects to the care of the borrowing governments.
However, as the ADB’s operational environment has changed over the years,
a rift has appeared between its self-image and actual activities. Especially in the
1990s, the Bank has moved to areas generally considered political. The ADB
Charter cannot be changed and the self-image is too valuable to be relinquished.
It has therefore been necessary for the Bank to reinterpret what the ‘economic
considerations’ mentioned in the charter signify.
The ADB undeniably has an important role to play in helping make gover-
nance – both in public and private – sectors more efficient and effective in the
DMCs. During its history, it has accumulated a great deal of experience and
expertise on what development means in various Asian and Pacific contexts.
Moreover, it has had access to talented individuals from both DMCs and donors,
and considerable financial resources at its disposal. It should thus be well suited
for this task. It can carry it out in an ‘Asian’ way, through non-confrontational
consultation, as it has been wont to do in the past. This may be an inefficient
way to do things, but it is still better than dictating ready-made solutions to coun-
tries in dire straits.
The fates of many of the Asian ‘miracle economies’ during the economic
crisis that broke in 1997 highlights the importance of a constructive role. The
crisis was dubbed by the dominant school of economic thought a crisis of gover-
nance: the Asian economies crashed because they were not practising
accountability, participation, the rule of law and transparency in their public
(and private) governance. The crisis was presented as proof that Asian experi-
ences were, at best, misleading. The ADB was eclipsed by the IMF and the
World Bank, which took the lead in providing both financial aid and a stringent
package of reforms to the countries hit by the crisis. The practical effects of the
ADB’s policy on good governance were hidden by the impact of these reforms
and the turmoil that engulfed some of the countries in question.
Critics of the Washington Consensus have seen the Asian economic crisis as a
crisis of the very model of development advocated by Western institutions. If
this is true, the IMF/World Bank-imposed reforms (providing that they have
been implemented) have sown the seeds of future crises. The ADB as a regional
institution has a special responsibility to seek good governance practices that are
suited to local conditions in Asia and the Pacific. After all, it is Asians who should
have ownership of their own development.
Notes
1 For a concise presentation of the ideas typical of the Washington Consensus, see
Standing (2000).
2 For a presentation of the basic tenets of the Asian Development Model, as seen by
the Japanese, see Yasutomo (1995). For an illuminating discussion of the Washington
Consensus vs. Developmental State debate, see Gore (1996).
150 Janne Jokinen
3 Interestingly in its 1992 Asian Development Outlook, the ADB presented the results of a
study on the levels and growth of military expenditure in the DMCs. No conclusions
were drawn from the results, however. See Kappagoda (1995: 150–51).
4 See also http://www.mofa.go.jp/policy/oda/summary/1999/ref1html.
5 Some of these results were expressed in the 1991 World Development Report of the
World Bank. However, the report itself was The East Asian Miracle, which the World
Bank published in 1993. See also Gore (1996).
6 This definition is repeated in the ‘Governance’ section of the ADB Operations
Manual. See http://www.adb.org/Documents/Manuals/operations/om54aps.
7 The policy document gives as the source for this section the World Bank paper
Managing Development: the Governance Dimension, published in June 1991.
8 See e.g. Bøås’ (1998: 120) comments on the impact that adopting good governance
policies will have on the role of MDBs in the DMCs.
9 See also Article IV, Section 10 of the World Bank’s charter.
11 ‘Good governance’ and the
Development Assistance
Committee
Ideas and organizational constraints
Ken Masujima
Introduction: DAC and good governance

The concept of ‘good governance’, which came increasingly to be used in the
development cooperation field in the 1990s, seems well entrenched at the dawn
of the twenty-first century. ‘Governance’ is used at both international and
national levels of analysis: governance of an international organization or gover-
nance of a country, not to speak of governance of a company (corporate
governance) (UNESCO 1998). Although the analysis presented here is limited to
the usage of governance in development policy discussion (hence governance of
a developing country), the spread of the word governance in recent years seems
to correspond to a certain reality in today’s political and socio-economic life.
Governance, in comparison with government, does not necessarily connote a
moral tone. In addition, governance, as opposed to a government, does not
imply crude power relations (the question of who rules whom). In short, gover-
nance seems to be adapted to the neoliberal mode of regulation of world affairs,
which relegates politics to economics (see Chapter 9).
In the field of development, the appearance of the concept of governance is
closely related to the dominance of the Bretton Woods institutions. As is well
known, the International Monetary Fund (IMF) and the World Bank came to
dominate the development field (in terms not only of financing but also of
providing development ideas) during the 1980s with the spread of structural
adjustment in most developing countries. The concept of governance, which was
introduced in these institutions at the beginning of the 1990s, suited the partic-
ular circumstances in which they found themselves. On the one hand, these
institutions came increasingly to recognize the importance of domestic political
factors in realizing the economic policy reforms that they required in return for
their structural adjustment loans. The first such statement was made in a World
Bank report on Africa, which spoke about domestic bottlenecks (World Bank
1981). On the other hand, the Bretton Woods institutions are formally prohib-
ited by their terms of reference from interfering in the domestic affairs of
member countries. It was largely in order to escape from this dilemma that the
World Bank began developing the notion of governance. Governance in the
sense employed by the World Bank falls under ‘administrative governance’ as
152 Ken Masujima
opposed to ‘political governance’, which is commonly used by bilateral donors

(Leftwich 1993: 606).
DAC is particularly well suited to see the politics involved in a concept such as
governance, which, it must be said, is more political in nature than most other
‘ideas’ in development policy – such as poverty or sustainable development. DAC
is the donor forum of the OECD (Organization for Economic Cooperation and
Development), and as such tends to reflect the thinking of bilateral agencies on
development (Nunnenkamp 1995: 9). At the same time, the DAC clearly strives
to establish itself as a multilateral organization with autonomous positions. The
publication of the DAC Manual (OECD 1992), incorporating various DAC
policy recommendations made over the years, should be taken as proof of such
an endeavour on the part of DAC (especially of its secretariat). Thus DAC, as an
organization, presents an interesting case where bilateral donors’ perspectives
interact closely with the secretariat’s position. The history of how the recognition
that domestic political factors matter came about at DAC, is therefore also
largely a story about the discovery of ‘the political’ in DAC; and the concept of
‘good governance’ on which our analysis shall focus upon underwent a number
of twists and turns.
It was argued at the time that DAC possessed ‘comparative advantage’ over
other international organizations in discussing matters pertaining to good gover-
nance. The structure of representation at DAC (only OECD donor countries)
was said to facilitate discussion on the subject. We shall see whether DAC found
itself at ease in treating good governance issues, by tracing how this concept
originated and evolved at DAC. More specifically, we shall argue how the organi-
zational traits of DAC constrained its discussion of the issue.
DAC is a subsidiary body of OECD, among other OECD committees such as
the Economic Policy Committee and the Trade Committee. Thus DAC, as part
of OECD, shares the same characteristic as OECD: an intergovernmental and
forum organization.1 The OECD is organized around ‘committees’ which
regroup member countries’ representatives. The secretariat basically exists to
render services to its committee. The role of the OECD is not to dispense money
or services (there is a small exception regarding the provision of technical coop-
eration to less-developed member countries such as Greece and Turkey until
1994, and to the countries in transition from the beginning of the 1990s to this
day). Its role is rather to provide a forum for discussion, based on analysis,
among member countries. More specifically, DAC’s purpose is to discuss ways of
increasing the volume and efficiency of member countries’ aid.
However, DAC is unique among subsidiary organs of OECD in that it has a
more autonomous standing. The DAC Chair is entitled to express the opinions
of DAC without gaining approval from the OECD Council. The relatively
autonomous position of DAC within OECD originates from the following three
factors. First, the fact that DAG (the Development Assistance Group) preceded
OECD is important.2 Second, the permanent DAC Chair, residing in Paris, the
only such case among OECD committees, reinforces the autonomous character
of DAC vis-à-vis OECD. Third, at DAC, delegates are usually high-level (deputy
‘Good governance’ and the DAC 153
permanent representatives), which strengthens the standing of DAC among

committees in OECD.
Officially, the highest level of decision making in DAC, as in other OECD
committees, is the council, especially the council at the ministerial level, held in
June of every year. The secretariat of DAC, Development Cooperation
Directorate, is under the authority of the secretary-general of OECD. With a
limited number of staff members (thirty in 2001), given the intergovernmental
nature of the organization, the DAC Secretariat has only a limited role at least
so far as initiating new ideas is concerned. For its part, DAC holds, besides
regular meetings held at various intervals composed of DAC delegates, an
annual high-level meeting (HLM) every December. This is attended by ministers
and the heads of aid agencies and determines the priorities of DAC work. There
is also a senior-level meeting (SLM) held every year attended by deputy-
head-level civil servants in charge of aid policy. Although there is a potential risk
that OECD’s positions, as expressed by the council or the secretary-general, and
DAC’s positions diverge due to the relatively autonomous nature of DAC, such a
divergence has in fact rarely materialized. Thus it can be assumed that HLM is
the most important policy making body of DAC.
Framework of analysis: organizational constraints

There is a growing literature on the role of ideas in political science. Authors
differ as to the place accorded to ideas: some take ideas to complement a
rational-choice analysis based on interests; others emphasize the constitutive role
of ideas, contending that perception of interests itself is formed by ideas.
However, for our purposes it suffices to look at what the literature offers
concerning ideas as dependent variables (what factors account for changes in
ideas, and not how ideas affect policy outcomes).
From this perspective, a common framework of analysis can be detected in
most of the existing literature. On the one hand, most authors point to the
objective conditions which necessitate adaptation. On the other hand, the ‘fit’
between the idea and decision makers is pointed out. On the latter, Hall distin-
guishes between ‘political viability’ and ‘administrative viability’ in discussing the
adoption of Keynesian ideas in different countries (Hall 1989a: 371). For our
analysis of an international organization, ‘political viability’ can be subsumed
under international and national explanations. Here the ‘fit’ is with international
distribution of power (hegemony), or inter-organizational relationships,3 or with
the positions of (groups of ) member countries.4 In all of the cases, the roots of
change are sought outside the organization itself.
Transnational-level analysis, and in particular an epistemic community
approach, admits an autonomous role for the organization, but in a narrow sense.
The communities of experts, who are supposed to play an influential role, are
regrouped in the secretariat. Although the role of an international secretariat in
policy making cannot be neglected (Barnett and Finnemore 1999; Hamlet 2000),
the structure of the organization itself needs to be taken into account to evaluate
154 Ken Masujima
more precisely the power of the secretariat, as it operates under the constraints of
the organization. Among scholars who underline the role of organizational struc-
ture, Sikkink (1991) distinguished a difference between organizations charged with
development in Argentina and in Brazil. However, such authors basically compare
organizations across nations. It is necessary to adapt these previous approaches for
an analysis of an international organization. For that purpose, one should speak of
‘organizational constraints’, which derive from the characteristic of the organiza-
tion, and which hinge upon the choices available to policy makers.
We can distinguish the following three organizational constraints:
1 Internal structure: In the case of DAC, we can discern three points. First, the
fact that DAC is not engaged in any operations (technical cooperation, etc.)
is important. The contrast with the World Bank and UN agencies such as
UNDP (United Nations Development Programme) could not be clearer.
Second, the relatively weak role of the secretariat should be underlined. The
intergovernmental structure, with the committee at its centre, clearly limits
any multilateral ambition of the secretariat. Third, the composition and size
of the secretariat need to be emphasized. The relatively small size of the
staff and its composition (mostly economists) has an impact on how ideas
are treated in the DAC.
2 Representation (extra-unit, unit and sub-unit): For an organization with an inter-
governmental character, the question of representation is crucial. For DAC,
the problem was posed at the following three levels of representation: extra-
unit level, unit level and sub-unit level.
Extra-unit level representation refers to the relationships with other interna-
tional organizations. DAC, like any other international organization, is
engaged in a permanent competition with other international organizations.
Thus rivalry with other international organizations in the same field (the
World Bank, etc.) is an important constraint on DAC.
Unit level or national representation refers to the membership of the orga-
nization. Thus in the case of DAC, the fact that it is composed solely of
donors has a significant impact. Sub-unit level representation refers to
which ministries are in charge of DAC within each member government.
Many members are represented by aid agencies (or ministries), but some
are represented by the foreign ministry, and still others by the finance
ministry. Most importantly, the fact that the US is represented by USAID
(and not by the US State Department) has had an extremely important
impact on the positions taken by the US and hence on the positions taken
by DAC as a whole.
3 Culture: The question of structure and representation is important, in its own
right, in constraining directly the choices of agents. However, it is also
important in bringing about certain forms of organizational culture. Kier
(1996) defines organizational culture as ‘the set of basic assumptions, values,
norms, beliefs, and formal knowledge that shapes collective understandings’.
It should be noted that factors other than internal ones relative to the orga-
nization in question could also shape its culture. Especially important are
the international norms prevalent at at any given time (human rights,
democracy, self-determination, etc.).
Such organizational cultures are important because choices are constrained not
only by objective conditions but also by cognitive factors. In the case of DAC,
one can point to a certain attitude of the organization as a whole, evident since
the time of its creation, as regards its mandate. There is a certain hesitancy on
the part of DAC to talk about the internal structure of developing countries.
The fact that these countries are not represented on the committee has not made
it easier to discuss their internal affairs. Another example of the organizational
cultures at work in DAC is related to the sub-unit level representation. The fact
that aid agencies, which typically hold particular views on development, different
from those of the treasury, are dominant representatives at DAC, reinforces its
ideational outlook. The neoliberal economic doctrine, which swayed the Bretton
Woods institutions, has never predominated at DAC.
In what follows, four periods in the adoption of a good governance agenda are
examined, based on the analytical framework presented here. The relatively
short time-frame chosen is justified in view of the dramatic transformation that
the world was undergoing during that period.
Growth and equity (1987–89): broad-based growth

The recognition that developing countries’ internal policy and structure is vital to
the success (and hence the efficiency) of development aid was apparent in DAC
circles by the end of the 1980s. The first manifestation of such recognition can be
found at the twenty-sixth HLM of 1–2 December 1987. Although in the press
release this received only a small mention (‘Support for policies which promote
widely shared growth and, in particular, foster the creation of productive employ-
ment’), DAC members debated at length administrative problems in developing
countries. The HLM decided to initiate a mid-term study to elaborate a strategy
for the 1990s, taking stock of the experiences of the 1980s (OECD 1988).
The most vocal public pronouncement on the question was made at the
twenty-seventh HLM held on 5 –6 December 1988. It was decided to call the
on-going DAC work on the strategy for the 1990s ‘Working with Developing
Countries towards Equitable and Sustainable Growth and Development’
(OECD 1988). The title is revealing in several respects: ‘working with developing
countries’ shows DAC’s intention not to appear as trying to impose its own ideas
on developing countries. And the adoption of the notion of sustainable
development reflects a consensus among DAC members for incorporating envi-
ronmental concerns. The concept of ‘sustainability’ was going to become a key
word for the 1990s without raising a major debate from the outset at the DAC.
However, it was not without some tension and debate that the two notions,
‘growth’ and ‘equity’, came to coexist in the text.
156 Ken Masujima
The debate on growth and equity goes back to the beginning of the 1970s
when the idea of ‘basic human needs’ came to the fore of the development
agenda, but it surfaced again at the end of the 1980s. It was the US which took a
position in favour of a growth-oriented approach, insisting in particular on the
force of the market economy. It argued in fact that the DAC work on develop-
ment strategies for the 1990s be entitled ‘Broad-based Economic Growth’.
Although the US side took note of the vulnerable groups who do not benefit
from the market economy, it basically emphasized the crucially important role of
market-oriented policies. Some countries showed more interest in the social cost
of the adjustment process, and they argued that DAC should put more emphasis
on equity.
It is, thus, in large measure a compromise between the two camps that lies
behind the coexistence of ‘growth’ and ‘equity’ in the press release of the HLM
of December 1988. Following the HLM, Joseph Wheeler, chairperson of DAC,
explained that ‘equity’ is shorthand for a variety of concepts such as ‘broad-
based development’, a ‘participatory approach’, ‘basic human needs’, ‘human
resources development’, ‘common drive to eliminate the worst aspects of
poverty’, and ‘investing in people’ (OECD 1988: 27).
However, the transition from ‘equity’ to ‘participatory development’, which
occurred in 1989, is not very clear. Although in the press release of the 1988
HLM the term ‘participatory development’ was used for the first time, it occu-
pied rather small place in the text. It was used in a paragraph enumerating
major developmental challenges in the years ahead: ‘A need to ensure broad-
based growth and participatory development’ (OECD 1988). The notion of
participatory development was put forward especially by UNRISD in 1985, and
therefore was in circulation at the end of the 1980s in the development commu-
nity.5 We have merely to note that ‘participatory development’ in DAC
discussions came gradually to replace the notion of ‘equity’.
Up until 1989, discussion of the internal political factors of developing
countries was confined to three considerations regarding economic develop-
ment. First, the neoliberal economic doctrine was important in raising an issue
of political nature which had been judged too sensitive up till then. At the
HLM in December 1988, the most influential presentation was made by the
US, which argued for ‘broad-based economic growth’. The US emphasized
the positive role of a free market economy. It was argued that some measure
had to be taken to ensure access of the broad mass of people to the fruits of
growth, to enable them to participate in the productive process. This US posi-
tion thus opened the way for discussion of equity, participation, human rights,
and the political structure of developing countries.6 Second, concerns with the
social impact of structural adjustment programmes were raised at the HLM.
They were voiced especially by countries such as Canada, Norway and
Sweden, but other countries also expressed concern. Although no country was
opposed to growth as such, there were differences as to what kind of growth
should be sought. This debate on the relationship between growth and equity
continues to this day. Third, the HLM’s press release spoke of ‘political bottle-
necks’ as a cause of debt problems, and of ‘institutional weaknesses’ in many

developing countries. This corresponds to the World Bank’s discovery of
governance issues in its 1989 report on Sub-Saharan Africa (World Bank
1989b), though it did not employ that word. Thus the mention in the press
release of ‘a need to ensure broad-based growth and participatory develop-
ment’ can be said to be the origins of the ‘participatory development’
approach that DAC was to embrace later as a lead theme of development
cooperation in the 1990s.
How can we explain the process by which the three origins of the ‘political’
found their way into the formulation ‘working with developing countries towards
equitable and sustainable growth and development’?
International explanations cannot account for the outcome, as the US posi-
tion (adoption of ‘broad-based economic growth’ as the leading theme of the
DAC strategy for the 1990s), did not predominate. In addition, there was no
established idea prevalent on the international scene. Therefore explanations
must be found at the national level. The outcome in terms of the final formu-
lation of the press release can be seen as the result of a compromise between
the US and those calling for more equity. The structure of DAC acted to
constrain the outcome. The ways in which DAC resolves differences of opinion
among its members typically put the two opinions together without analysing
relationships and contradictions between them. This was facilitated by the fact
that DAC is not engaged in any operational activities. The contrast with the
World Bank could not be clearer. Whereas the World Bank needed to develop
the notion of governance to give guidance to its operational staff, DAC could
rest content with formulating ideas largely to please its member countries. The
sub-national character of representation was important too, in the sense that
the US position seemed well calculated to appeal to the domestic constituency
which wanted to preserve USAID’s policy. Another point regarding the organi-
zational constraints at work concerns the culture of DAC. Although some
members raised the issue of human rights and democracy, it was judged better
not to put this forward in public pronouncements as in the past. This act of
self-restraint can be said to form an organizational culture of DAC.
Participatory development (1989–90): recognition of

the linkage between economics and politics
Following the discussion on the elaboration of the DAC strategy for the 1990s,
the approach taken by the DAC was that of ‘participatory development’. It was
asserted that:
participatory development implies more democracy, a greater role for local

organizations and self-government, respect of human rights including effec-
tive and accessible legal systems, competitive markets, and dynamic private
enterprise.
(OECD 1989)
158 Ken Masujima
The notion of participatory development, which originally was used as a catch-

word for equity, now came to mean such political concepts as democracy and
human rights. It is of course true that participatory development, which signifies
access by people to decision making in development, ultimately implies all these
things. However, in 1988 no such explicit linkage with politics was made. Further,
participatory development, which was just one of the three headings in the DAC
strategy, came to be elevated to the principal theme in 1990. The title of the press
release at the conclusion of the DAC’s HLM of 4 December 1990 was:
‘Participatory Development: A Lead Theme for Development Cooperation in the
1990s’. Closer to the content of what is referred to elsewhere as good governance
was a call, in the same document, for a strong role for governments: ‘New
emphasis on participatory development does not imply bypassing governments.
Indeed, effective development requires strong and competent governments and
public services’ (OECD 1990). Here the issue of governance is clearly stated, but
without employing that term. In the press release of 1990 cited above, the word
‘good government’ (not ‘governance’) was used for the first time, designating the
need for strong and effective governments. Thus DAC came to recognize the
problem more or less at the same time as the World Bank within the framework of
participatory development. It was partly for these reasons that DAC initially tried
to comprehend the problem in terms of participatory development.
At the HLM of 1989, when the DAC strategy for the 1990s was finally
adopted, explicit mention of such political factors as democracy and human
rights was made. However, this was contained within the limit of relevance to
economic development, even if DAC was said to possess ‘comparative advan-
tage’ in dealing with this kind of issue.
How can we explain this? International explanations can offer us clues as to
why this sudden surge of ‘politics’ came about. The wave of democracy which
surged through the countries of Eastern Europe and many developing countries
was putting the idea of democracy at the forefront of the international agenda.
In addition, the US was for the first time stating at DAC that support for democ-
racy had become an official objective of US aid policy. But the call for working
to support democracy, as part of DAC aid strategy, was not heeded. Thus the US
was not able to dominate the discussion. Here national explanations can help
understand the outcome. While some countries, like the US, had already taken
up democracy support as part of their aid policy, many members were still grap-
pling with the issue. Under the circumstances, it was conceivable that the
outcome should be a middle way.
It was, as pointed out earlier, the structure of DAC itself which was respon-
sible for the compromise character of the outcome at DAC. The fact that the
DAC secretariat was mostly composed of economists helped to confine the
problem to the traditional field of economic development. As to the representa-
tion of DAC, it is also relevant to point out the sub-national character of the US
position. In a way, the US had been engaged in political assistance since 1961
when the Foreign Assistance Act was passed, and more particularly since the
1980s. It is interesting to note that, as DAC was itself struggling with the newly
emerging idea of political aid, USAID, which represents the US government on

the DAC, was also trying hard to contain the political dimension of aid within
the US (the executive and the legislative). USAID, as an institution, is also mostly
composed of economists and was from the beginning uncomfortable with polit-
ical aid. It is thus ironic that USAID was calling for the adoption of democracy
assistance as a main agenda item at DAC. However, once USAID decided to
adopt democracy support,7 the US tried to move DAC in a direction that it had
not favoured in the first instance.
The PD/GG approach (1991–93)

DAC began to take a more explicitly political position once it had adopted the
terminology of good governance. The turning point in DAC’s approach to the
question came at the DAC HLM of December 1991. Although at the previous
HLM of December 1990 the question of the relationship between aid and the
emerging trend of democratization in developing countries was debated at
length, it was treated within the framework of participatory development. At the
OECD ministerial council, the highest policy making echelon of the organiza-
tion, held on 4–5 June 1991, the question of the relationship with non-member
countries was extensively discussed as the first item of the agenda. The press
release referred to ‘good governance’ for the first time in major OECD policy
documents, though in a timid way:
Ministers emphasize the need for participatory development, including

broad-based economic growth and equity, protection of human rights and
improvement of governmental effectiveness. An optimal public resources
allocation can only be achieved through good governance.
(OECD 1991)
However, the question was still treated under the umbrella of PD. Thus at the
SLM of 17–18 June 1991 it was agreed to launch a survey of DAC members’
policies and practices on PD. The emphasis was put on gaining information on
‘good government, democratization, and respect of human rights’. In the field of
‘good government’, the DAC distinguished between, on the one hand, ‘more
traditional’ aspects, which had been treated in ‘Principles for New Orientations
in Technical Cooperation’ (OECD 1992: 51–64) under the heading ‘institutional
development’, and on the other hand, ‘more political’ aspects, in the context of
strengthening transparency and accountability, and assuring broader participa-
tion in decision making processes.
Following the decision at the HLM of 1990, DAC continued its work on the
question, and the interim result of its reflection was published in the 1991 edition
of the DAC chairperson’s report, written around September 1991. It noted:
In the short time since the High-Level Meeting of last December, the
dialogue has moved markedly to expand discussion beyond traditional
160 Ken Masujima
concepts and perceptions of participatory development. The concept of

‘governance’ has assumed a more central focus as an area of key attention
by both bilateral and multilateral donors. The World Bank, in particular, has
moved to better define the concepts and programmatic aspects of assisting
the Bank’s clients toward improved governance.
(OECD 1991: 33)
This recognition of the importance of the concept of governance found its

way into the discussion at the HLM of December 1991. There, one of the two
items of the agenda was entitled ‘Participatory development, democratisation,
human rights, and good governance’. Based on a donor survey made for the
meeting, DAC identified the following areas for discussion under that item;
• economic reform and democratization

• strengthening the human resources base
• contributing to improved functioning of governments and civil services at
central and local level
• encouraging democratization
• working towards reduced military expenditures
• attacking corruption
• implications for policy dialogue and coordination
The DAC’s HLM of 1991 is remembered for announcing the link between the
allocation of aid and progress in this area. It also led the way toward an
approach on the issue, which came to be referred to as the ‘PD/GG’ approach
(Robinson 1999). It was thus important in marking the transition from ‘participa-
tory development’ to ‘PD/GG’ at DAC. It should be noted, however, that good
governance is employed here still in the sense of ‘administrative governance’ à la
World Bank. In the HLM’s press release, mention was made of ‘good gover-
nance within the framework of law’, which was preceded by a reference to
‘representative government’.
For explaining the adoption of the PD/GG agenda, international explana-
tions apply. The continuing democratization on the world scene contributed to
the consolidation of the agenda at DAC. However, the existence among DAC
members of divergent views on the question was largely to account for the
outcome. Some countries did not want DAC to tackle the issue of good gover-
nance, which was considered more political than participatory development.
These countries were cautious, not wishing to be seen as interfering in the
domestic affairs of sovereign nations, for various reasons. But the US, supported
by several other countries, proposed the creation of a new permanent structure
within DAC to tackle the issue of PD/GG. The US government even offered a
voluntary contribution toward that goal. However, the US was only partially
successful, for as we shall see, only an ad hoc working group was created, and for
a short, fixed term. It was evident that as long as there were countries opposed to
the modification of the work programme (France was most vocal in its opposi-
tion), the result had to be a compromise. Thus DAC’s institutional timidity

toward the question can be attributed to national causes.
Organizational constraints were also at work. One such constraint was DAC’s
relatively early grasp of the problem under the heading of participatory develop-
ment. It was the ‘DAC approach’. The fact that the World Bank was pushing for
‘governance’ was, at least initially, not considered reason to adopt the same
terminology. However, once it was recognized that good governance was making
headway on the international scene, DAC changed its initial attitudes and
adopted this term (although in parallel with participatory development).
However, the most relevant explanation seems to be the secretariat’s
economist bias. The head of the secretariat of the time confided to the author of
this chapter that aid people mostly trained in economics confronted for the first
time the question of politics at the beginning of the 1990s and revealed them-
selves to be unequipped to deal with it.8 Indeed, within the secretariat only one
staff member was charged with the PD/GG issue at that time.
Whither the PD/GG approach? (1993–)

At the HLM of 1991, it was decided to convene a special DAC meeting on
PD/GG issues, and to entrust the DAC Expert Group on Evaluation to pursue
analysis on the issue. The discussion at the DAC PD/GG meeting of 12–13 May
1992 was important in illuminating where DAC members agreed and disagreed.
It was evident that there were some countries, such as the US, Germany and
Sweden, who were already experimenting with assistance in the area now
defined by DAC as PD/GG, and that there were others who were not engaged
in this activity. Thus, although there was consensus in recognizing the link
between economics and politics, there was divergence as to how far to go.
Countries such as Australia, New Zealand, Finland, and to a certain extent
Japan and France, seemed rather cautious at the discussion. Although the secre-
tariat now affirmed that DAC need not be confined any longer to the timid and
concealed way of discussing the matter (‘participatory development’), some
countries still hesitated to overtly discuss the domestic political affairs of devel-
oping countries at DAC. Their hesitant attitude was in marked contrast to that of
the US and others, for whom democracy and governance are goals in themselves
to be pursued with the means of development aid.
Another point of discord concerned the definition of the problem, which
stems from the above-mentioned difference of basic attitudes on the issue. For
some countries, it was still desirable to confine discussion at DAC to participa-
tory development, and hence within the classical context of economic
development. Some other countries (noteably the UK), for different reasons,
preferred to focus on GG, which in their view encompassed PD. For still other
countries (the Netherlands, Sweden and Canada), it was not desirable to limit
the discussion within the PD/GG framework; the human rights issue was for
them in itself important. Thus DAC was not able to agree on definitional
problems, and had to be content with listing various concepts without analysing
162 Ken Masujima
the linkages among them. It was not clear, for example, whether democracy fell
under PD or GG, or was to be treated separately under its own heading. This
was true of ‘DAC Orientations on Participatory Development and Good
Governance’ (OECD 1993), a kind of good practice/guidelines document
endorsed by the HLM in December 1993.
The 1993 HLM set up, for a three-year term, an Ad Hoc Working Group on
Participatory Development and Good Governance. This submitted, at the end of
its three-year term, a final report. At the same time, the DAC Expert Group on
Aid Evaluation published a thick synthesis report in 1997. The term of the Ad
Hoc Working Group was not renewed, and instead an informal network on
PD/GG was established to continue work on PD/GG issues. This informal
network concentrated on ‘pilot studies’, involving donors and partner countries,
and produced findings for Benin, Bolivia, Burkina Faso, Malawi, Mauritania and
Uganda. It was decided that the informal network on PD/GG be merged with
DAC’s nformal network on institutional and capacity development (I/CD) in
February 2001 (called GOVNET – Governance and Capacity Development
Network). It remains to be seen how much of DAC’s activities on good gover-
nance will continue after the fusion with I/CD, which regroups officials in
charge of traditional technical cooperation activities in the capitals.
In explaining why DAC ceased to treat the problem of PD/GG as a principal
item after it had become the lead theme in 1992, national explanations, which
highlight the lack of consensus among its member countries (notably the opposi-
tion of certain countries toward the idea of a permanent structure in charge of
PD/GG at DAC), are valid. However, transnational explanations also seem to
account well for the outcome. The fact that a distinct network of aid agency offi-
cials in charge of PD/GG in the capitals did not materialize (in contrast to the
issue of gender, which saw the institutional establishment of sections in charge of
the issue, and which led to the establishment of the Working Party on Gender
Equality) was important in limiting the eventual creation of a permanent
PD/GG organ at DAC.
However, with the passing of time, the limits of DAC as an institution
became apparent. To put it bluntly, DAC does not have much to say about
PD/GG beyond carrying out surveys of donor practices. Above all, as discus-
sions on PD/GG, especially GG, became more and more sophisticated, the DAC
secretariat was not sufficiently equipped for dealing with the technical matters in
depth. Besides, competition with the World Bank played a role. DAC, under the
leadership of a new director of the secretariat, turned increasingly to the ques-
tion of conflict (peace-building) to show its distinctiveness. It is revealing to note
that the question of conflict and development came before PD/GG in the 1997
edition of the report of the secretary-general which referred to the activities of
OECD in 1996. Further, when it came to questions of more political nature,
DAC was not a favourite place for bilateral donors either. It should be noted that
important diplomatic questions have always been discussed outside DAC. On the
most politically sensitive issues of political conditionality, i.e. democracy and
human rights, member governments did not find it useful to come to DAC. The
question of representation is important here. These matters are not always

within the competence of an aid agency.
Notes
1 The distinction between forum organizations and service organizations was made by
Robert W. Cox and Harold K. Jacobson (Cox and Jacobson 1973).
2 The Development Assistance Group (DAG) was created at the meeting of representa-
tives from twenty governments on 14 January 1960. The OECD came formally into
being on 30 September 1961. The relationship with the DAG was one of the issues of
the negotiations leading to the creation of the OECD (Masujima 1999).
3 For an overview of the work on inter-organizational perspectives, see Finnemore
(1996b).
4 Miles Kahler distinguishes between ‘multilateralism with large numbers’ and ‘multi-
lateralism with small numbers’, referring to patterns of coalitions in multilateral
organizations in the post-war period (Kahler 1992).
5 UNRISD’s study on popular participation was published in 1985.
6 It should be noted that USAID’s new policy on democracy promotion also originated
partly from the neo-conservative economic doctrine. It is also probable that USAID
intentionally adopted the neo-conservative tone in its discourse to justify its develop-
ment agendas (Carothers 1999).
7 USAID issued a series of four initiatives in December 1990 to help shape its
programme for the crucial issues of the 1990s. One of these was the ‘Democracy
Initiative’. Following this paper, USAID published its policy statement on democracy
in November 1991 (USAID 1991).
8 Interview with Mr Helmut Führer, Director of the Development Cooperation
Directorate of the OECD from 1975 to 1993, 26 August 1996.
12 The evolution of the concept
of poverty in multilateral
financial institutions
The case of the World Bank
Alice Sindzingre
Introduction: the conceptual framework

An analysis of the determinants of the birth and evolution of new ideas within
development institutions can be made from the angle of different disciplines:
political science, economics, development studies. This chapter will examine the
role of poverty as an idea in one specific multilateral institution, the World Bank,
and the exchanges between ideas and institutional forms, between institutional
forms and politics, and between the inside and outside of the institution. The
trajectory of the concept of poverty in academic research and the World Bank is
presented first. The political economy of knowledge and the meanings of
poverty are then examined, as the outcome of complex processes involving ideas
and power, reflected and simultaneously created by the Bank, inside and outside
the institution.
The concept of poverty in the academic world

The evolution of ideas in development economics and external aid agencies has
influenced the concept of poverty both within the agencies and the Bank. This
evolution includes the two ideas of inequality and multidimensionality.
In academia, ideas relating to poverty and inequality have changed
profoundly during the nineties (see Sen 1998; 1999; Kanbur and Squire 1999). A
series of academic papers has shown that a high degree of inequality may be
detrimental to growth (Kanbur and Lustig 1999; Rodriguez 2000). Increased
inequality between countries and within certain industrialized countries like the
US has led to many reflections on its determinants (Krugman 1992). These
debates are intensively developed in international economics, labour economics
and international political economy. Another debate has focused on poverty in
rich countries, demonstrating that there is no ‘evolutionary force’ towards better
standards of living (Hoff and Stiglitz 1999).
The Nobel Prize awarded to Amartya Sen was an important milestone,
adding weight to the concept of poverty in economics. Poverty is no longer solely
defined as income or consumption poverty. Health, education, dignity and
democratic participation have become intrinsic components, in line with Sen’s
The evolution of the concept of poverty 165
concepts of ‘capabilities’ and ‘functionings’. The concept of relative poverty has

gone beyond the notion of human needs expressed solely in terms of subsis-
tence. Poverty may thus be conceived as asset poverty – land, education, health,
social claims. This multidimensionality is dynamic, health and education being
simultaneously assets, dimensions, causes and effects, and it incorporates risk and
lack of security as dimensions of poverty. This has led to new questions of
measurement, controversies on the relevance of poverty lines, and quantitative
vs. qualitative approaches. Debates over definitions are reflected in policies, in
particular on the role of the state in alleviating poverty, with delicate political
tradeoffs relating to the priority of dimensions (income poverty, social services or
the reduction of inequality) and of instruments (direct ones via public redistribu-
tion, or indirect ones via the increase of opportunities). These extensions of the
definition have entailed new ambiguities due to the expanding notions of
empowerment and participation (Vieira et al. 1997).
The meanings of the concept of poverty within the

World Bank
There is a genealogy of concepts of poverty, starting from the idea of basic
needs (Lipton and Ravallion 1995). Since the 1960s, the concept of poverty has
changed in meaning and has followed different trajectories depending on the
development agency concerned, spreading progressively as a major mission
(Sindzingre 1997): the ILO which is more focused on employment and labour-
intensive policies, the FAO with priority on food security and production, the
United Nations, in particular the UNDP, and later the OECD. As for the World
Bank, the concept has been at the heart of its lending policies since the 1950s
(Kapur et al. 1997). After the ‘trickle-down’ approach relying on growth, the
McNamara years were the era of ‘waging war on poverty’, before the structural
adjustment paradigm. The theme of poverty tended to fade away in the 1980s,
during the era of structural adjustment. The criticism that adjustment
programmes lacked a ‘human face’ was an opportunity for UNDP to become
the advocate for more social and comprehensive policies rather than purely
macro-financial objectives, and to push to the forefront the popular concept of
human development, resulting in the Human Development Index, with the intel-
lectual support of Amartya Sen, although some scholars refuted the scientific
foundation of this index.1 In the late nineties, a wide consensus emerged within
the global ‘development community’ of donors, giving priority to poverty reduc-
tion as a key issue on the development agenda.
Changes and mechanisms in the evolution of ideas

Several determining factors affect the nature of the changes and evolution of
ideas within the Bank. Given the organization, large staff, and periodic reforms
of incentives, changes are only at the margin, and have also been very slow in
being implemented. The Bank feels challenged by its external critics, and it has a
166 Alice Sindzingre
strong capacity to absorb them by hiring these individuals as staff members and,
in this way, to absorb their ideas too. Changes are also introduced as a result of
developments in the domestic policies of member countries. Thus the evolution
and differences in the ‘messages’ emitted by the Bank can only be noticed over a
significant time-span.
The Bank is, first and foremost, a bank and not a research institution. It
continues to be dominated by economists and financiers (and also engineers).
Proof based on econometrics and cross-country regressions is the fast track
towards validation. Among the mechanisms constraining the evolution of ideas,
the literature of the Bank is deeply self-referential (making extensive use of grey
literature from inside the institution). Another mechanism is the phenomenon of
amnesia vis-à-vis previous work. This is not peculiar to the Bank but characterizes
the development discourse and agencies in general. Furthermore, the Bank has
become increasingly a producer of knowledge about development, perceiving it
as a global public good, and of economic analysis.2 Research has been in an
expansionary mode, and the sizeable financial and logistical resources of the
Bank, compared to academic research centres or bilateral agencies, facilitates the
construction of vast original databases, the conducting of surveys, and the
collection of information from national institutes, which few can afford.3 The
Bank has the capacity to attract and hire the best scholars and experts on the
international market, as well as former ministers and other high-profile personal-
ities. It also pursues a policy of high visibility through journals, a number of
publications about development, networking and training, addressed to scholars
and officials in developing countries.
The evolution of ideas: the Washington Consensus and its

aftermath
After the ‘Washington Consensus’– a term coined in 1990 by John Williamson
referring to macroeconomic instruments and objectives of stabilization and adjust-
ment – the idea of a ‘post-Washington Consensus’ focused on the role of
institutions and on a broad concept of development – a ‘transformation of society’
– was circulated in the late 1990s, especially in view of the widely differing
outcomes of reform in transition economies.4 Owing to his position as Vice-
President and Chief Economist, Joseph Stiglitz was able to introduce some of his
ideas into the research activities of the Bank. In the writings of Joseph Stiglitz, the
state has been rehabilitated, market failures recognized, and the key role of institu-
tions confirmed. Some of the permanent intellectual attitudes within the Bank
include the importance of market reform, liberalization and openness. The Asian
economic crisis accentuated the traditional antagonism between partisans of
market reform and analysts of institutions (states and firms), which became a
subject of disagrement between the IMF and the Bank during Stiglitz’s tenure.
World Development Reports are simultaneously an expression of the evolution
of ideas inside the Bank, and a contribution to it. They play an important role as
a platform for debate within the Bank, but also constitute important sources of
data for researchers and policy makers on a global scale. Presented in the World
Development Report of 1990, following the WDR of 1980, the key ideas relative
to poverty were economic growth based on rapid market liberalization, the provi-
sion of basic health, social services, and safety nets. The WDR 2000/1 on poverty
(World Bank 2000b) is a balanced and heterogeneous mixture of internal and
external influences. A kind of ‘third way’ is being advocated, reflecting the notion
developed by centrist political parties in the United Kingdom and the US in the
nineties, and its alternative policies to free marketism and active state interven-
tionism. It refers to market forces but is accompanied by redistributive policies
and institutions of social support (Kapstein 1998–99; Sachs 1999), and it is a
rather consensual notion. Yet the ideas surrounding the WDR 2000/1 are still the
consequences of fierce debates originated by the staff – operations, research –
and member countries. Growth is still considered to be the best instrument for
poverty reduction, as well as opportunities created by the private sector, but poli-
cies must address social inequalities within and between countries and the possible
short-term negative consequences of liberalization.5
The political economy inside the Bank: the political

economy of knowledge
Within the Bank, two levels contribute to the elaboration of ideas: the staff, and
the Board composed of twenty-four executive directors representing the 184
member countries. The proportion of their shares in the capital of the Bank
reflects their economic weight. The Board is responsible for conducting general
operations under powers delegated by the board of governors, and it is the exec-
utive entity. Within the Board, relations between the executive directors’ offices
reflect the power countries exert ‘outside’ the Bank.
The economics paradigm

The cognitive tools favoured by an institution determine the production of
knowledge and the norms associated with it. The last decade has witnessed a
movement within economics towards a greater penetration of mathematics, as
well as recognition of economists by their community, founded on an increasing
formalization and the use of econometrics as an instrument of proof
(McCloskey 1983). This leads to specific types of arguments of authority, based
on the latest and most sophisticated statistical and econometric techniques. The
use of econometrics and cross-country regressions is sometimes criticized within
the economics community (Srinivasan 2000), but it is presented to laypersons as
scientific certainty.
This product of the internal research department is widely used to confirm the
results contained in reports, but makes it difficult for laymen to evaluate and criti-
cize such reports. The problem of validating conclusions pertaining to economics
is reinforced by a tendency within the Bank to use the grey literature it produces.
The Bank has implemented an intensive dissemination and publications policy.
This has the dual advantage of offering better conditions for external validation,
and exerting a stronger influence on the discipline of development economics.
Political scientists or sociologists have been hired, but in terms of decision
making their power is weak. These disciplines are confined to specific topics, e.g.
‘social’ topics, gender, education, health, refugees, community participation, in
the case of sociologists; and the public sector, decentralization and corruption in
the case of political scientists. This prevents new approaches to problems, partic-
ularly those that are considered to be of a purely economic nature and,
therefore, within the strict competence of economists, such as macroeconomic
shocks, trade relations, financial crises, and so on.
The status of research within the Bank: ambiguities

and debates
As already mentioned, the World Bank is a development bank and not a research
institution. It is a Bretton Woods multilateral institution, defined by precise
mandates. In principle, once the Board has given its approval at the different stages
of an operation, staff members have the flexibility to choose its appropriate design
and technical aspects. Even if not linked directly to it, the choices of the staff are
backed by the existence of a research department. The research department bases
its legitimacy on both sides: on the one hand, an internal level of validation, i.e. the
Bank’s higher organizational bodies, the Board and other members of staff, and on
the other, an external level of validation, i.e. the international market of research
and academic journals. The Bank’s researchers must publish according to the rules
of this market if they are to be considered as researchers belonging to the scientific
community and not just as officials of a development bank.
This produces a wide range of research topics and conclusions. Many of the
papers and reports contain conclusions full of nuances on strategic and ideolog-
ical issues. A significant number of these papers do not reflect the homogeneous
orthodoxy that is perceived outside the Bank as the ‘party line’. They cover, for
instance, the necessary role of the state, or the impact of globalization on
inequality. Some even suggest that structural adjustment has had no effect on
poverty reduction (Easterly 2000a). Disagreements exist among researchers on
certain issues, or with operational staff, for example, on the effects of public
spending on education, health, growth and poverty, or on the relationship
between income poverty and social indicators. Some studies allocate the respon-
sibility of poor performance to external shocks much more than to national
policies (Easterly et al. 1999; Easterly 2000b). Financial deregulation may be
clearly criticized, as well as the retreat of the state, and here research functions as
a support for more political positions, for instance the politics of the Asian crisis
and the competition between the two Bretton Woods institutions.
Debates over the research results produced by the Bank reflect analogous
disagreements in the academic world. The debate on the relationship between
inequality and growth, as well as on the relationship between growth and
poverty, may be taken as examples. With respect to inequality and growth, the
position put forward in several papers is somewhat to the left by US political

standards and in the classical discussion within welfare economics on the tradeoff
between efficiency and equity.6 Putting forward arguments about growth but
with a redistributive position, some papers demonstrate the negative role of
inequality and argue in favour of active public social policies and transfers.7
Parallel to the raging controversies in academic economics, other studies within
the Bank have provided contrary evidence.
The policies recommended in the WDR 2000/1 encountered explicit
disagreement. The report stated that growth can reduce poverty, but to a lesser
extent in unequal societies than in egalitarian ones, and that since poverty
implies powerlessness, it recommended reducing social inequalities and empow-
ering poor people. The resistance to this view stems not only from political
circles but also from academics, inside and outside the Bank, who have shown
growth to be the best instrument of poverty reduction.8
From the nineties onwards, many studies favoured democracy and political
participation. Corruption, discrimination and exclusion have become important
topics of research. The lack of empowerment of the poor was a major pillar of
the analysis of poverty presented in the WDR 2000/1. Stiglitz, who defends
democracy as an intrinsic good, in line with Amartya Sen’s position, backs this
approach. He refuses to be trapped in a technical debate on whether democracy
is good or bad for growth and its economic efficiency (Stiglitz 2000a), which may
have contributed to the hostility of more orthodox economists inside the Bank.
In some studies undertaken by the Bank, institutions are included as essential
determinants of growth, which must exhibit a certain level of ‘quality’. However,
these consensual themes have led to strong debates among the Bank’s
researchers. Although the theme of ‘quality’ is put forward by recognized
scholars (e.g. Rodrik 2000), such disagreements have also occurred outside the
Bank, where the analysis has been described as trivial, unscientific or ‘muddled’,9
and claims about inequality, institutions or democracy as unproven assertions.10
On the other side of the coin, these ventures outside traditional economics
are not even welcomed by the other social sciences. This good intention to
include qualitative concepts, or concepts situated at the borders of economics, is
easily exposed to their criticisms. The importance of institutions is often seen as
a vague concept, quantified by approximate measures. The recourse to external
influential scholars is instrumental in these debates.11 However, their studies
remain sources of disagreement among the Bank’s researchers.12
Political economy of the Bank: the member countries
The diversity of positions on poverty

First of all, the different member countries have divergent positions on develop-
ment and poverty within the Board. These different positions obviously entail a
variety of policy recommendations. They show clearly the limits of common
international priorities and joint policies on poverty. The US position traditionally
favours growth, the openness of markets, particularly open capital markets, liber-
alization, free trade, privatization, and a minimal state role. Growth and
market-oriented policies are perceived as serving national security, foreign policy
and economic interests (Bergsten 1998). In line with its domestic policies, the US
does not have a strong interest in poverty reduction per se in its development poli-
cies. This is visible, for example, in the traditional policies advocated by USAID,
and in the treatment of poverty within the US, where growth is a more urgent
priority than poverty reduction. This approach has been supported by the
decrease in poverty that has accompanied the exceptional period of continuous
growth in the nineties. In this particular instance, by putting poverty at the fore-
front, the Bank cannot be criticized for reflecting slavishly the economic views of
the US government, and it can even claim to be independent of its influence.
As revealed in the WTO summit at Seattle in 1999, the US defends the idea
of core labour standards and the interdiction of child labour supported by
unions. These views imply policies against poverty that are opposed to others
advocating export-led growth, the openness of developed countries to products
from poor countries, or observations that child labour is, in the present context,
one of the means for the poor to escape poverty (Basu 1998). The latter views
are backed by some developing countries, and such issues continue to be the
subject of fierce controversy.
Other rich countries have different ideas and try to voice them inside the
Board. For instance, Japan would give the state in developing countries a more
interventionist role than would the US.13 The UK, like the Netherlands, has
become active in aid for poverty, both on a bilateral basis as well as through the
multilateral system, with an emphasis on human rights.14 Scandinavian countries
take into consideration recipient countries and their poverty the most seriously.
Being major bilateral donors, whose funds are welcomed by the Bank, there is a
certain rivalry between these countries over the leadership of European coun-
tries in terms of models of poverty policies (Cox et al 2000). Generally, European
countries tend to be more cautious about a minimized role for the state and the
intrinsic virtues of market policies and growth. Yet all the rich countries of
OECD participate in the Development Aid Committee, which has elaborated
common objectives on poverty reduction, the International Development
Targets. Likewise, the framework of the Poverty Reduction Strategy Papers
(PRSPs) initiated in 1999 has been designed by the Bank with the objective of
being a common basis of poverty reduction strategies for all donors as well as
recipient countries.
There are differences in the concepts of poverty adopted by each country. For
instance, the quantitative poverty criteria used in the US are not accepted by
other countries that follow relative poverty criteria and consequently place more
emphasis on inequality and exclusion (Atkinson and Bourguignon 1999). Similar
problems affect the themes of safety nets, taxation and social protection.
Moreover, poverty as a concept may not belong to a country’s intellectual tradi-
tion, as in France where social protection is more relevant. Second, institutional
arrangements and decision making procedures differ between member countries
and influence their stand on particular issues. The influence of the ministries
(finance, foreign affairs, cooperation) in charge of relations with the Bretton
Woods institutions can vary. Third, member countries may use their own
national research institutions in order to have at their disposal possible alterna-
tive analyses to those of the Bank, or they may prefer to use the Bank’s research.
Furthermore, the influence of domestic public opinion on the positions of
member countries in the Board differs, reflecting their different forms of democ-
racy, lobbying, role of NGOs and citizen’s voicing (see Bøås and McNeill 2003).
Power relationships between member countries

Power relationships within the Board reflect power relationships between
member countries and the political preferences of their governments in the
outside world. However, the political games are complex and constrained by a
number of factors. In the first place, the foundation of a multilateral institution
such as the Bank is built on efforts to achieve a certain degree of consensus.
Consensus is obtained when an operation is presented at the Board. It is easy to
achieve when the geo-strategic stakes are evaluated as weak, when its impact is
negligible (for instance, in view of the size or income level of the recipient), or
when agreement results from previous bargaining. In these cases, the arguments
produced by the Bank’s management, and supported by its research, may play a
role in convincing Board members. In other instances, consensus is negotiated
before the meetings by informal means. Consensus therefore depends on the
evaluation of a particular situation. If the latter is deemed to be strategic (for
example, in the case of big emerging borrowers, in terms of geopolitics or debts
outstanding), compromises will reflect power relations and coalitions, as formed
in other bilateral and multilateral settings. Consensus depends on the importance
of the use of Bretton Woods institutions in a country’s foreign policy. Consensus
also depends on the issue in question, whose major themes and pillars will always
be the subject of intense controversy between officials representing member
countries, especially such subjects as the role of growth and its priority compared
to other economic objectives, inequality, the effects of liberalization and trade
openness, the role of institutions, the struggle against corruption, and the polit-
ical economy of aid.
Second, the Bretton Woods institutions are constrained by legal limitations, i.e.
their articles of agreement. The Bank has an explicit mandate to fulfil objectives
of economic development, and it is prohibited from taking political considera-
tions into account in its lending operations (Bøås and McNeill 2003). This has
caused constant tension whenever the Bank has ventured increasingly into fields
that are peripheral to the traditional economic and engineering sectors, such as
governance, corruption, core labour standards; or when Joseph Stiglitz advocated
explicitly that international financial institutions should support democratic
processes (Stiglitz 2000b). But at the same time, the Bretton Woods institutions are
under heavy political pressure, and non-economic considerations influence the
process of approving programmes and projects. The Bank is trapped in a
paradox: it is a political institution, it cannot avoid getting involved in politics, its

projects are the outcome of political bargaining, but its legitimacy stems from
political neutrality and technical competence (Sindzingre 2000).
The Bretton Woods institutions follow de facto the US influence since it is the
lead shareholder, and weighted voting gives it the biggest share of the voting
power. In 2002, the voting power of the US accounted for 16.4 per cent of the
total votes for IBRD and 14.49 per cent for IDA; Japan accounted for 7.87 per
cent and 11.06 per cent respectively, while Germany, France and the UK each
held about 4.3–4.5 per cent of the voting power. In addition, the distribution of
seats reflects the hegemony of rich countries, with for instance one seat each
being allocated to the US, Japan, Germany, the UK and France, and only two
seats to the entire continent of Sub-Saharan Africa.
Since the mandate of the Bank focuses on the promotion of development, on
which conceptions may diverge and evolve with time, the relative influences of
member countries interact in a complex manner within the Bank. The US
Treasury has a strong influence over some dimensions, since it is the major
shareholder and considers the Bank as an instrument of its foreign policy. But
this influence is not absolute and is limited by the understanding on the part of
the US that the Bank must be seen as an independent and non-politicized insti-
tution (Gwin 1997; Bøås and McNeill 2003). It played a strategic role in the
handling by the IMF of the 1997 Asian crisis. The US Treasury insisted on the
resignation of Joseph Stiglitz, following his open disagreement with it on how to
deal with the Asian crisis and other issues. Yet the game is complex and at the
same time involves different levels: the two Bretton Woods institutions, regional
blocs, and individual countries, forming variable coalitions and putting forward
certain ideas in response to specific situations. International core labour stan-
dards, for example, have been strongly defended by the US government, but the
Bank is more cautious on this issue, due to its rules prohibiting political elements
in its loans.
The struggle against poverty in developing countries was not a traditional
goal of US foreign aid during the Cold War (rather it was promoting security,
trade and democracy). However, since 1989, tackling environmental crises and
epidemic diseases, as a way of improving the quality of life of the poorest, has
become a feature of the new diplomacy. Although a common ‘European model’
is expressed in the discourses of member countries, no European model can be
detected in reality. Added together, European countries represent more weight
than the US. But within the Board there is no joint position of European coun-
tries on development, nor has any attempt been made to establish structured
coalitions on a specific topic. The European Commission’s directorate in charge
of development explicitly aligns itself with the conceptual framework of the
Bank, for example the Poverty Reduction Strategy Papers (PRSPs).
Member countries can put forward their preferred themes and research
centres by funding some of the Bank’s initiatives (e.g. through the ‘trust funds’).
And in this particular instance, they can influence a multilateral institution like
the Bank, which always needs additional resources and has been subjected to
several streamlining schemes in the past. But bilateral institutions are unable to
compete with the vast resources of the Bank when it is a question of hiring the
best experts and producing data and studies. Some agencies consider this to be
unnecessary, and choose instead to adopt the conceptual framework proposed by
the Bank.
All countries accept the policy frameworks of the Bretton Woods institutions
because they are members. A number of countries impose the signature of an
agreement with the Bretton Woods institutions as a condition for their own bilat-
eral loans and grants. But it can happen that at the level of their bilateral policies
within a developing country, in the field, even within this common framework
and apparent acceptance, donor countries give only weak support to IMF and
Bank policies. Donor countries also give themselves room for manoeuvre in their
bilateral relations with developing countries (e.g. the aid-dependent sub-Saharan
Africa), where their political and economic interests can be expressed clearly,
using bilateral aid as a more direct dimension of their foreign policy.
Political and economic evolution of the concept of the

role of the Bretton Woods institutions
There is an increasing amount of criticism of globalization and the role of
multilateral institutions from the expanding ‘global civil society’, the paradox
being that the latter is typically an outcome of this globalization. Since the
1990s, the Bretton Woods institutions have been widely criticized, for different
reasons, by NGOs, governments, academia and the private sector. The private
sector was not willing to bear the financial burden of the Asian crisis, as was
recommended by the Bretton Woods institutions in their reflections on the new
financial architecture (Eichengreen 1999). Criticism has spread in the US (espe-
cially in the Congress),15 and a consensus emerged on a division of labour
between the IMF and the World Bank. Many observers recommend that the
IMF should return to its original mandate and refocus on short-term financing.
The Bank has a comparative advantage in development issues, long-term
financing and poverty reduction. This situation was precipitated by the Asian
crisis, followed by the others (Russia, Brazil). The controversy between Stiglitz
and the IMF was widely covered by the press, and forced the Bretton Woods
institutions to open their doors. The increasing attention paid to safety nets may
perhaps be an expression of guilt, and an attempt to moderate public criticism of
‘globalization without a human face’ (Stiglitz 2000a: 1).
There are also critics in the academic community, who constantly attack the
ineffective bureaucracy of international organizations and their inefficient and
badly designed programmes. A number of facts have fed these criticisms, such as
the failed reform in Sub-Saharan Africa. The explanation put forward by the
Bank – that reforms are beneficial but that countries failed to implement them
correctly – is not perceived as satisfactory. This has led to an erosion in the credi-
bility and legitimacy of the action taken by the Bretton Woods institutions
(Sindzingre 2000). The Bank seeks to distinguish itself from the IMF, in the
context of a rivalry between the IMF and the Bank over the best development
model, despite the official division of labour.
The Bank has reacted to its critics by pushing poverty to the top of its agenda,
and poverty reduction has now become a major component in its programmes
and projects. But for poor countries, programmes and conditionalities are drawn
up jointly with the IMF (following the ESAFs, the PRSPs). In this way, the IMF
has also extended its brief to poverty. NGOs, religious representatives and trade
unions are invited to participate in the process. The objective of poverty reduc-
tion has to be included wherever possible, and the Bank has increased its lending
for Human Development (from 5.1 per cent of total lending in 1980 to 21.8 per
cent in 2000) (World Bank 2000b).
Policies and reactions of the recipients: the poor

countries
Research and operations may function as parallel worlds. Policies do not neces-
sarily follow directly from the conclusions of research, or from previous studies
or surveys. Both domains imply different cognitive mechanisms. Their validation
processes differ, with ‘efficiency’ as the norm for operations, and ‘truth’ or knowl-
edge as the norm for research.
The first reason for this is that some findings from research studies on poverty
are difficult to put into operation. Moreover, operationalization is made more
difficult if the Bank extends its interest more and more beyond the traditional
domains of infrastructure and economics, and the same difficulties ensue from a
broad definition of poverty. For instance, although economic growth is a familiar
theme for the Bank, which has the appropriate toolkit to deal with it, this applies
less to a more political topic like income inequality, now considered to be an
important factor in influencing poverty. Another illustration is the reform of
local institutions, since they are, by definition, the outcome of endogenous
processes. Donors cannot impose institutions from the outside, yet they can have
an important impact on them through the design of reforms, through condition-
alities or financial support. The Bank – and the recipient governments – are
aware that given the nature of states and institutions in developing countries,
civil groups are rarely isolated from local politics, and at worst their representa-
tive character can be questionable. Projects with a greater emphasis on social or
political issues are thus more difficult to implement. Projects are tied to criteria
of feasibility, and project officers are evaluated accordingly. Relevant indicators
of effectiveness and progress are also difficult to design.
A second reason is that the operational level has its own rationality and works
within the frameworks provided by the projects. For example, an anti-poverty
project may be a social fund project. But social fund projects, like any other type
of project, form a class of their own. As such, they are relatively standardized,
and include other components than those strictly focused on poverty reduction
(e.g. ‘community development initiatives’, public works programmes, institutional
development). Other projects may include public works or labour-intensive
schemes concentrated on employment; while they reduce poverty, this is not their
primary objective (Sindzingre 1997).
Adjustment programmes follow a relatively standard framework, and their
design is indirectly inspired by macroeconomic research and by models.
Likewise, projects follow from the internal rationale of disbursements and
management of a portfolio, and cover standard sectors, for example the public
sector or the banking sector. They are accompanied by a series of reports
relating to the project cycle, but not necessarily by research. In the nineties, the
move towards poverty as a visible objective acted as a driving force to launch
new programmes, poverty reduction being the key theme. These involved the
PRSPs designed with the IMF, the replacement of the ESAF facility by one on
Poverty Reduction and Growth (PRGF). Yet there is a risk that although the
word ‘poverty’ may be included in project documents, many projects are not in
reality focused on poverty.
The recipient countries

The new ideas and programmes of international financial institutions insist on
participation, one of the pivotal leitmotivs. However, it is still a matter of debate
whether the concepts of poverty elaborated by the poor countries are seriously
taken into account. Local studies and research, when they exist, are often consid-
ered to be irrelevant, like the approaches of non-economic social scientists when
these are not validated by donor funding or publication in Western journals.
Many factors are involved here. One reason is the difficulty of how to ask the
poor. Furthermore, the poor are by definition a totally heterogeneous group,
merely defined by a series of heterogeneous properties: low income, bad health,
illiteracy, and so on. This raises the difficult question of the criteria for represen-
tation, and the groups who are able to represent them and express their opinion.
Participation is often reduced to meetings with an established group of NGOS.
Experts and scholars from developing countries are likewise often the same
people belonging to the networks known by the Bank, and who are regularly
invited to consultations. It is therefore difficult for them to criticize the Bank too
strongly. Diversification of viewpoints is insufficient because the Bank has few
contacts with scholars outside this network. As the latter do not benefit from the
facilities given to the Bank’s regular experts (information, conferences), these
scholars are not always as effective. This creates a vicious circle in the collection
of homogeneous opinions from developing countries.
Moreover, until recently, the Bank by mandate dealt directly with govern-
ments – governments which in Africa, for instance, built their power on
indifference towards their poorer citizens. As for the intellectual elite of the
developing countries, they tend to be channelled into the donor agencies or
offered better jobs in developed countries, with improved prospects and salaries.
The political economy of local politics interacts with the mistrust of leaders vis-
à-vis the Bank, for example in sub-Saharan Africa. Given the current political
economy of aid, African governments are frequently indifferent to new trends in
reform. Under constant financial pressure, and primarily concerned with

domestic politics and retaining their power – preoccupations that are much more
relevant to them than ‘development’ – they tend to accept anything from the
donors, as long as it means the release of fresh financing.
Another dimension of the reactions of recipient countries is dependence on
aid: some of them have no other alternative than to adhere to the policies of
poverty reduction established by the Bank, and its recommendation that the
processes be participatory. The relationship with the Bank and its policies is
much more asymmetrical in the case of poorer countries. The richer developing
countries, which borrow on non-concessional terms, have greater powers of
negotiation and more room to propose their own ideas to the Bank when it
recommends a particular policy of poverty reduction.
Conclusion: different meanings, different ideas of

poverty
The World Bank’s emphasis on poverty is a strategic response, and may be a sign
of the guilt of rich countries or an implicit admission of the failure of past poli-
cies. It can be perceived as a short-term political answer. To speak of poverty is
to postpone speaking of development, marking a shift in the temporality –
shorter time-frames – of ideas as well as policies. Simultaneously, it is a concept
built by the life span of other concepts: poverty has re-emerged because of the
failure of previous beliefs – the benefits of structural adjustment and the auto-
matic virtues of reforms, among others. It corresponds to the emergence of new
types of growth and crises, and to increases in world inequality between coun-
tries even more than within countries (Bourguignon and Morrisson 1999;
Milanovic 1999).
The evolution of the concept is also determined by the features and cognitive
routines of the institution applying it. The World Bank has a remarkable
capacity to adapt to external circumstances, always at the margin. Change takes
years to occur, due to the Bank’s size as well as its internal constraints. Among
the conceptual changes, which usually occur long after their appearance in the
outside world, there is the multidimensional nature of poverty; the key role of
the state; and participatory processes with civil society. The Bank’s capacity to
adapt is also due to its major shareholders, which push it towards change
because of their intellectual traditions and their political stakes.
There remains an intrinsic flaw in the actual concept of poverty as used by a
bank. The World Bank tends to continue to base its definition on income or
consumption, even if it claims that this definition is multidimensional. Income is
an easier instrument for analytical studies and surveys. But the conceptual diffi-
culty arises from the fact that income can still be considered as a more relevant
dimension than all the others, such as health, education and participation, and
that multidimensionality does not address the question of a possible hierarchy of
dimensions (Ravallion 1994; 1997). Another flaw lies in the extensive use of the
term itself, which qualifies a concept, a dimension, observations, outcomes,
objectives, or policies, and refers to causes as well as to effects. Poverty is thus a

more ambiguous concept than others in development research.
Finally, the concept of poverty exhibits a plurality of meanings, which allow
for a plurality of policies. Not only does it emerge as a response to hegemonic
processes and as a dimension of the transformation of an idea, but the fact that
there are at present multiple meanings of poverty is the outcome of power rela-
tionships within countries and within a multilateral institution like the Bank: for
example, meanings based on the American vs. the Nordic tradition. Some mean-
ings may also emerge as opposed to others, for example a hypothetical European
concept of poverty compared to the US one. At the same time, this multilateral
arena produces a consensus and a temporary stability for the concept of poverty
despite, or because of, this plurality.
Notes
1 A tough critique has been made by Srinivasan (1994).
2 Squire (2000: 111) shows that Economic and Sector Work (ESW) has accounted in
the early 1990s for around 30 per cent of the operational budget.
3 In 1996, expenditure on development research amounted to $25 million, or about 2.5
per cent of operating expenditure.
4 See the influential Prebisch Lecture (Stiglitz 1998).
5 As summarized in Kanbur and Vines (2000); see Wade (2001a) on the politics of the
WDR 2000/1.
6 Keefer and Knack (2000); outside the Bank, among a growing literature, for instance
Perotti (1996); Rodrik (1998)
7 This is analysed in several papers by Martin Ravallion; see the review of the literature
by Kanbur and Lustig (1999).
8 See the controversial paper of Dollar and Kraay (2000).
9 The WDR 2000/1 and The Quality of Growth (2000) have been described as ‘harmful
muddle’ in the Economist (30 September 2000: 108).
10 For instance by Jagdish Bhagwati or T.N. Srinivasan; Naim (2000: 508) concludes that
the so-called Washington Consensus is much more a ‘Washington confusion’.
11 For instance Amartya Sen, Dani Rodrik (Rodrik 1998; 1999), Jeffrey Sachs, or Alan
Winters (Winters 2000a; 2000b).
12 For instance over Joseph Stiglitz’s arguments that development is a transformation of
society entailing not only the creation of market institutions but also of political insti-
tutions (Stiglitz 1998; 1999).
13 As shown by the tensions surrounding the World Bank’s study on the East Asian
Miracle in 1993; see Amsden (1994). Japan’s efforts to put forward the lessons of its
own experience of development are examined in Gyohten (1997).
14 See the White Paper issued in 1997, ‘Eliminating World Poverty’.
15 See the ‘Meltzer’ report, set up by the US Congress in 1999.
13 The role of ideas in the
United Nations
Development Programme1
Asuncion Lera St Clair
Introduction
The United Nations Development Programme (UNDP) was created to function
as the specialized agency that coordinates all the development assistance and
technical cooperation of the United Nations (UN). Since its creation in 1965,
UNDP has evolved from an agency giving technical and scientific assistance to
less developed countries (LDCs) to become a post-project agency, a policy agency
whose role is to provide advice, advocacy and resources to empower the poor.
Ideas in UNDP have changed significantly over time, particularly when we look
at the changes in values embedded in this organization’s view of development
and poverty. In the 1960s poverty and lack of development were conceptualized
by UNDP as income and consumption problems, supposedly solved by increases
in economic growth and external aid. Since the 1990s UNDP has promoted
‘human development’, in part based on Amartya Sen’s ‘capability approach’,
and has lately reformulated this development perspective in terms of human
rights and freedoms. Such conceptualizations of development and poverty
explicitly look at the ends and means of the process of development in terms of
intrinsic values and what these mean for people’s lives. In short, UNDP has
moved – at the conceptual level – from endorsing an economic view of poverty and
development to increasingly include an ethically formulated perspective that conceptu-
alizes and evaluates the role of development in terms of securing the freedom,
well-being and dignity of all people, and framing these goals in terms of social
justice.
This explicit concern for ethical issues has evolved unevenly, but has eventu-
ally emerged in UNDP’s official statements and documents as a means to
respond either to crises in the world or to weaknesses in the theories used to
conceptualize development and poverty. This has helped to draw attention to the
fact that development theories have important ethical components. Although
some use the term ‘development’ in a descriptive sense, meaning a process of
economic growth, modernization or industrialization, there is also a normative
sense of the term. Most would argue that development per se is a value-laden
term that tacitly entails that certain types of economies and societies are better
than others (Dower 1983). Some moral principles are relevant to the relations of
The role of ideas in the UNDP 179
richer countries and international agencies with poorer countries; and we may
ask questions such as: What is good development? How is good development
related to human well-being or a good life? Who is or should be responsible for
bringing about good development? What are the most important obstacles to
good development? The value dimensions of development – as well as the moral
costs of development and poverty eradication policies – have been the subject of
study by a heterogeneous – and in many cases disconnected – group of
researchers since the early 1970s (Crocker 1991; 1998; Dower 1998; Gasper
1986; Goulet 1971; 1995). These authors have promoted ethically explicit
conceptualizations as alternatives to dominant notions, as more appropriate
options precisely because of their moral content. But it is not only moral values
that have an important role to play in accounting for the evolution of ideas in
UNDP.2 This chapter focuses on the role of some cognitive values, such as
measurability, coherence, or simplicity. Like scientific theories, policies have not
only moral or ethical but also non-moral normative constraints. They must be
able to satisfy certain criteria in order to be considered successful, such as testa-
bility, quantification, or simplicity.3 Changes in values are ways to respond to
failures of theories or to crises in the world. Values change at the same time as
theories evolve or are replaced by other theories. Theories – sets of doctrines
and assumptions – in the social sciences, need to offer coherent and adequate
solutions to the problems they aim to solve. Alterations of these theories are a
response to their inadequacies or flaws as much as a response to real problems in
the world (Wolin 1980). Cognitive values are a source of power for ideas. For
example, whether a concept is suited for quantification and therefore easily
measurable has been an important reason for the rapid or slow institutionaliza-
tion of that idea. Furthermore, each science has an ordering of cognitive values;
thus the identification of the roles of such non-moral norms also helps to
account for the predominance (or lack of it) of certain disciplines in the thinking
of UNDP.
The focus on both cognitive and moral values implies blurring the distinction
between facts and values, given that all values – coherence or measurability as
much as goodness – arguably derive their authority from ideas of human flour-
ishing and ideas of reason.4 In an important sense, we take as rational what
helps us achieve what we conceive as good for us as human beings. That is,
conceptions of rationality are always guided by our idea of the good. Ideas can
be powerful for many different reasons, including their moral and cognitive
content. Thus the moral and cognitive values implicit in many ideas used by
UNDP endow them with power: the power of morality and the power of ratio-
nality.5
This chapter begins its analysis with the origins of UNDP, deals rather briefly
with the next twenty-year period, which saw increasing concerns for distribution
and basic needs approaches, and mostly focuses on the new values and goals
brought about by the idea of ‘human development’ in the 1990s. The last
section of this chapter elaborates on what may be characterized as a learning
process in UNDP; how the organization, although unevenly and in a non-linear
180 Asuncion Lera St Clair
way, has not only increasingly accepted more explicitly ethical values as the basis
for its conceptualizations, but has also been forced to keep its conceptualizations
open to public discussion and democratic deliberation.
The early years: first goals and values

UNDP was created in 1965 through the merger of two UN agencies, the
Expanded Programme of Technical Assistance for Economic Development of
Underdeveloped Countries (EPTA) and the United Nations Special Fund (SP).6
Since its creation, UNDP has taken on the task of promoting one of the most
important goals stated in the UN Charter:
To achieve international co-operation in solving international problems of

an economic, social, cultural or humanitarian character, and to promote
higher standards of living, full employment and conditions of economic and
social progress and development.
(UN Charter 1948)
Yet the values put forward by the UN Charter – freedom from want, human
dignity, human rights, equality, etc. – were not taken as integral elements of the
actual conceptualizations and practices of these agencies. UNDP assimilated the
practical goals of the agencies it replaced and thus continued that trend; and
sharing of technical and scientific expertise, political neutrality, and respect for
self-determination and national sovereignty are principles still embraced by
UNDP today. UNDP also inherited from EPTA its modus operandi. EPTA made
deals only with governments of underdeveloped countries; put its emphasis on
the poorest of those developing countries; gave its funds in the form of grants,
and distributed its funds to other UN specialist agencies according to sectoral
projects. EPTA also started the process of establishing connections in each recip-
ient country through country offices, thereby laying the foundation of the
current UNDP’s field offices network. Last, EPTA operated through collabora-
tion with other specialized agencies, distributing its funds in a sectoral manner.
Health grants were channelled through the World Health Organization (WHO),
support for employment programmes through the International Labour
Organization (ILO), and so forth. The Special Fund, created in 1958, had as its
main goal to provide for pre-investment opportunities for poor countries, and
was headed by Paul Hoffman, former manager of the Marshall Plan. Neither of
the two earlier UN agencies operated under a particular theoretical framework,
nor did they make contact with scholars or use the results of think-tanks working
on the subject of development.7 Economist W. Arthur Lewis, Hoffman’s deputy,
‘gave the Fund an intellectual initiative, drive, and dynamism in the face of
agency opposition and vested interests, but many of his initiatives were dissipated
after he left’ (Mendez 2002).
Although Lewis never thought that economic growth was an end in itself
(Streeten 1993), UNDP seems to have followed the international consensus on
the faith in the powers of industrial progress and the capacity of a strong
economy to solve all problems as the dominant paradigm of development
economics. According to Hoffman, the main goal of development was ‘to help
the people of the low-income countries become more productive and, hence,
able to purchase more, consume more, and contribute more to expanding the
whole world’s economy’ (Hoffman 1970). Finally, Hoffman ordered a study of
the UN system’s capacity for development from one of the leading figures of
development cooperation at the time, Sir Robert Jackson. The Jackson Report
stated that UNDP lacked a think-tank that could work out ideas and launch
them as directives for policy. The report emphasized the need to transform
UNDP into an effective operational organization; it supported the country
approach as a means to assure that national goals were the starting point of all
UNDP assistance; it endorsed the role of UNDP as endowing the LDCs with the
conditions of pre-investment; last, it asserted that the most important goal of
development was the transfer of knowledge – scientific and technological – in
order to raise people’s living standards. The Jackson Report emphasized that
UNDP could only provide training and well-being to people if the needs of the
LDCs, not some other view of aid, were the starting point of UNDP’s
programme design (UNDP 1969).
UNDP officially accepted many suggestions of the Jackson Report, particu-
larly a strong emphasis on the values of science and technology and the
ratification of country programming as its operational strategy. These views
coincided with the principles being put forward at the time by the Second
Development Decade (UN 1970). In short, UNDP embraced an economic
conception of development and its default view of poverty as income poverty
(usually measured using the one-dimensional indicator of individual income). By
the end of Hoffman’s term, UNDP was the coordinating agency of the UN for
development and technical cooperation, it had been endowed with more funds
than ever before, it had started creating its own think-tank, and had accepted the
position of a morally concerned and even obligated international actor; but it
did not include this ethical concern in its conceptual tools.
From poor countries to poor people: distribution and

basic needs
The intellectual contributions of UNDP during this period were very limited.
Following the recommendations of the Jackson Report as well as its own
mandate, UNDP allowed recipient countries to formulate their own priorities and
was not concerned with conceptualizations of development. But to a modest
extent, as part of its mandate to coordinate the development work of the UN,
UNDP provided some funding to studies that were influential in development
thinking. It was, for example, a minor financial contributor to the influential
studies on employment in the early 1970s, which led to the important concepts of
the informal sector and basic needs (see Chapter 4), and to an increased focus on
the issue of distribution, notably through Redistribution with Growth, the landmark
publication co-authored by Hollis Chenery, the chief economist of the World

Bank at the time, which stated very clearly, first, that growth policies cannot solve
poverty by themselves; and second, that poverty-oriented development strategies
cannot be achieved with the traditional conceptual tools of development theory
(Chenery et al. 1974).
The inclusion of concerns for distribution required the re-orientation of
development policies, but the primary role of growth was not questioned, nor
did the authors address the question of whether there were different kinds of
growth.8 The appropriate balance between growth and redistributive mecha-
nisms is still highly debated in the field.9
ILO’s Employment, Growth and Basic Needs: A One-World Problem (ILO 1976) was,
conceptually, a highly advanced document that integrated all the new ideas
analysed above: employment, inequality, the economic role of the poor, and the
focus on the least advantaged sectors of the population, as well as adding a new
concern for participation. The identification of a set of human needs, which
aimed to constitute an account of what is a minimum standard of living, was
used to identify the poor and to provide analytical tools to target development
aid. However, the identification of human needs, although allegedly only an
economic exercise (UNDP 1977), adds an important ethical dimension: the
conceptualization of what it is to be a human being, and the most important
aspects of a fully developed human life.
The picture of poor people that emerges from the inclusion of basic needs,
distribution of income and the surveys of the informal sector, however, is an
expanded version of the traditional account of humans in the science of
economics, the homo economicus. Such a being is moved by self-interest and acts on
behalf of individual concerns. The surveys used to measure the informal
economy and its agents – the poor – as well as the measurements of basic needs,
did not take into account, for example, people’s social and political environment,
nor their relations with the natural environment.
Part of the struggle we see in the use of revolutionary ideas by UNDP and
other multilaterals, then, is due to the strong position that certain disciplines have
and the prevalence of their cognitive tools. Although political scientists, social
anthropologists, sociologists and others started joining development research
teams in the 1970s, when it came to actually recommending changes these disci-
plines seemed to lack the tools to compete with those in the economist’s toolbox
and the economic data available on which to work (which, of course, reflects
earlier perceptions of problems and the sort of data which would illuminate
them). We would have to wait until the 1990s for the emergence of broader
conceptions of poverty such as capability approaches, human rights, or sustain-
able livelihoods strategies, and the inclusion of the idea of social capital, in order
to see considerable challenges to the idea of homo economicus.10
The inclusion of the new ideas discussed above – the informal sector, distribu-
tion, and basic needs – led to minor adjustments in other elements of the
toolbox or knowledge system of UNDP and the UN. The ideas were ‘added’ to
the dominant position of economic growth, but did not succeed in undermining
such prevalence or in offering an alternative paradigm. For example, a follow-up

document from the Commission on the Second Development Decade maintains
the goal of growth, the endorsement of the policy norms of measurability and
quantification, and the allegation that all these knowledge systems are value-free
and politically neutral (UN 1973). Poverty-oriented development, however, chal-
lenged the growth paradigm in very substantial ways and set an agenda for
development that was people-oriented.11 It also challenged the predominant role
of the science of economics. In closing the analysis of UNDP since its inception
until the end of the 1970s, I will argue that UNDP shared most of its ideas with
the rest of the development community, while it struggled to identify its area of
action in relation to other UN agencies and the Bretton Woods institutions.
These ideas, however, were the beginning of a process of cognitive and empir-
ical learning – as to how development ought to be conceptualized and how
poverty may be alleviated – which continues today.
Institutionally, UNDP initiated another set of reforms in order to recognize
all these practical goals. UNDP had not only to acknowledge the analytical limi-
tations of development economic models pointed out by Chenery’s team and the
ILO reports, but also to restructure itself as an institution. Among the most
important reforms, UNDP changed the evaluation system from a focus on inputs
(amount and types of expertise and grants transferred to the LDCs), to a focus
on outputs, evaluating which projects had worked, and drawing lessons from
experience. This emphasis on outputs has allowed UNDP to gain elasticity in its
operations, to decentralize, and to strengthen its presence and partnerships with
recipient countries.12 Some of these reform objectives were set up through a
proposal called New Dimensions in Technical Cooperation (UNDP 1975). Such
reforms pointed, however, to an important issue that marks much of the later
reforms of UNDP, the successful implementation of policies.
From poor people to the ‘infrastructure’ for their self-

realization: human development, social capital,
governance, and rights
During the 1980s, UNDP had to struggle with the consequences of including
social objectives: how to make this coherent with the pursuit of economic
growth, and with economic approaches and their inbuilt cognitive values. It also
had to adjust its goals to the changing international context. In the 1970s, Third
World countries increasingly gained influence in the UN and were very critical
of basic needs approaches. They demanded a New International Economic
Order (NIEO), which besides economic claims, argued for the inclusion of self-
reliance and respect for the dignity of the poor. The 1980s, by contrast, were
characterized by the neoliberal agenda and dominance of the Bretton Woods
institutions and their structural adjustment policies. While some other UN agen-
cies, particularly UNICEF, were criticizing the negative consequences of such
policies on the poor, UNDP published several documents endorsing structural
adjustment that became the guide for official policy.13
But UNDP also harvested some concepts that would lead this institution to
become an active actor in the intellectual conceptualization of ethically explicit
ideas. The ‘human factor’ became a subject inside UNDP under the leadership of
Bradford Morse,14 through the inclusion of concern for the interests of women,
and the elaboration of ways to promote self-reliance (an idea which originated in
the dependency school of the late 1960s and 1970s).15 The former led to the
establishment of UNIFEM as an independent part of UNDP in 1985. The latter
idea led the institution to strengthen its operational system, and made the figure
of the Resident Representative a key actor, as UNDP sought to place emphasis on
country offices, which were mandated to deal exclusively with governments; and
to help the LDCs to achieve more self-reliance, UNDP was required to respond to
the needs of central governments, but also to evaluate and assess the needs of
local communities, and all with minimal resources. Even in such a difficult
economic, political and conceptual environment, Bradford Morse succeeded in
shifting UNDP goals towards building self-reliance, strategies that would later be
called capacity development (UNDP 1984). Building self-reliance, in turn, led
UNDP to focus on grassroots groups, in particular minorities (such as women),
and to start building up contacts with non-governmental organizations (NGOs)
(UNDP 1985).
The focus on self-reliance through the establishment of relations with NGOs
was not only a response to political pressures, but ended up also as a conceptual
step in order to accomplish the task posed by the inclusion of social objectives: to
know the context of poverty. The emphasis on self-reliance and NGOs may thus
be seen as linked to the focus on the informal sector, as a continuity of values:
the values and ways of life that come from the particularities of the environment
where the poor live. Contacts with NGOs and a focus on the informal sector
relate to the sociological aspects of poverty; that is, they bring concerns about
the values of social life. What is a society? What are the relations between indi-
viduals and their social environment? What is the role of social foundations in
poverty reduction or creation? The 1980s mark a transition in which UNDP
advances from the position of apparently placing almost no value on the poor, to
one where it conceives of poor people as agents of their own destinies, taking
them at least as informants for – if not designers and implementers of – any
poverty strategy.
It is in 1986, during the Islamabad North–South Roundtable, that the idea of
human development first breaks to the surface (Haq and Kirdar 1986). As early
as 1985, Bradford Morse claimed: ‘In the past, development policies tended to
favour the build-up of physical capacities over human capabilities. More atten-
tion must be given to these latter resources as the true agents and sole objects of
development’ (UNDP 1985). The institution was ripe to take on the challenge
posed by Mahbub ul Haq (1976; 1995), who since the late 1960s had defended
human-centred views of development: to conceptualize and espouse the ideas of
human development and human poverty, developed with the help of Paul
Streeten and Amartya Sen. UNDP created the arena where these conceptions
developed – the Human Development Report Office, although this was an inde-
pendent think-tank not officially reflective of UNDP policy. This independence

was intended to avoid possible distortions of the idea brought about by the usual
consensus process that UN agencies go through. Although the HDRs did not
express the official views of UNDP, they were extremely influential, and the
ideas and strategies developed in these publications became accepted by the mid-
1990s by UNDP. Human development has influenced the choice of many other
goals in UNDP, such as governance. Arguably, some of the values of the UN
Charter were finally incorporated into the actual conceptual tools of the main
institution coordinating the UN’s development work.
The ideal of human development evolved during the 1990s as a response to
structural adjustment policies, mostly embraced by the Bretton Woods institu-
tions, and as an attempt to integrate other concerns, such as the environment
and the promotion of democratic ideals. Armed with the idea of human devel-
opment, UNDP could also respond to the demands posed by the NGOs of
shifting from top-down approaches to bottom-up strategies, thereby giving local
communities and local government a role to play in poverty reduction strategies.
In the words of its architect, Haq, human development aims to be a ‘judi-
cious mix of market efficiency and social compassion. … [At the time it offered]
a candid, uninhibited development dialogue that would serve the interests of the
global community’ (Haq 1995: 28). At the core of human development and its
accompanying indices is Sen’s capability approach. This is an alternative
conception of development economics and poverty that expands the informa-
tional basis of development to include concerns for the quality of life, social
justice, entitlements, and rights. Sen’s approach to development originates from a
critique of the reductionism and hegemony of a particular conception of moral
philosophy, utilitarianism, and of social justice, that of Rawls (1971). His
approach represents a social and political ethics based on pluralism that locates
its main normative force in the ideas of public deliberation and freedom.16
The multidimensional view of well-being and poverty flowing from human
development, a conception explicitly stated in ethical terms, places the emphasis
not on goods and consumption, nor on preference satisfaction or happiness, but
rather on facilitating people’s opportunities to live productive and creative lives
according to their needs and interests; or as Sen often says, those lives that
people have reason to value (Sen 1997; 1999; UNDP 1990). Human develop-
ment offers an explicit and thorough analysis of the ends and the means of
development, thereby challenging – this time in a rather substantial way – the
traditional view of growth and consumption as ends in themselves. Most impor-
tantly, Sen’s conceptualization is a new analysis for public policy, given that his
approach directs attention not only to the poor as an end, but rather to their
supporting infrastructures or ‘social arrangements’ as means that are provided by
society. In an important sense, it is arguable that although Sen’s approach is
focused on the individual, he indeed introduces the idea of social capital
(Douglas and Ney 1998). The Human Development Report series, following Sen’s
lead, shows that the link between economic growth and progress is not auto-
matic. ‘For once, an international body dares to speak of a number of cases of
high human development at modest income levels, and poor levels of human
development at fairly high income levels’ (Rist 1997: 206).
The rapid acceptance of human development within UNDP – including the
increasingly widespread production of country Human Development Reports after
the mid-1990s – and the spread of the idea to other multilaterals and bilateral
donors – with the exception until very recently of the World Bank, which has
been very slow in assimilating the lessons from the UNDP – is due, no doubt, to
the analytical power of this idea as well as to the moral content of its message.17
Haq ‘took on the leadership of large armies of discontent that were gunning,
somewhat sporadically, at the single-minded concentration on the GNP’ (Sen
2000a). Haq’s personality and qualifications made him a respected partner in the
South, given that he was representative of their views, as well as a respected and
recognized economist. Haq was capable of producing an idea that offered an
alternative view able to accommodate a plurality of concerns, thereby coordi-
nating discontent (Sen 2000a).
There is, however, another reason for such rapid acceptance: human develop-
ment gradually evolved several indices, such as the Human Development Index
(HDI) and the Human Poverty Index (HPI). This showed that at least some
aspects of human well-being can be measured – although indirectly – and
UNDP is therefore not departing from the same cognitive values of mainstream
approaches. It is clear, however, that human development and capability poverty
have more elements than those expressed in the main HDR indices.
The rapid acceptance of human development has had a domino effect within
this institution, leading to very substantial changes in many other ideas and in
the operational structure of UNDP. The effort to conceptualize the implementa-
tion of human development has forced the UNDP to re-assess the means used
until now for this purpose. Many of the means now proposed by UNDP are also
viewed as having intrinsic as well as instrumental value. In 1995, UNDP made
poverty reduction one of its main objectives and created a division – the Social
Development and Poverty Elimination Division (SDPED) – to work out ideas
and strategies with enough holistic capacity to integrate the different dimensions
of development and poverty. Capacity building, sustainable livelihoods, and the
Civil Society and Participation Programme (CSPP), among others, are the result
of UNDP’s attempt to reach an understanding of the lives of the poor, and
implement sustainable human development. All these strategies share the
common denominator of looking at the contextual factors of poverty. They
broaden their arena of action to the whole society, to incorporate concerns for
informal patterns of behaviour (social as well as personal), and to look at poverty
as an issue with multiple dimensions as well as changing needs (UNDP/SL
2000a; 2000b; UNDP/CSOPP 2000a; 2000b). The effort of implementing
human development principles leads UNDP to concentrate on the ways in which
the infrastructure of society can be transformed so as to help promote and
respect people’s choices.
The current focus on human rights and governance are, then, further conse-
quences of UNDP’s attempt to deepen the idea of, and implement, human
development. Yet UNDP re-conceptualizes them, as well as human develop-

ment, by focusing on the double added-value they generate together. There is
also an important connection between human rights concerns and governance:
both ideas depart from the assumption that democracy is the most appropriate
environment for progress, and consider that it does not directly or by itself entail
the protection of people’s choices. For UNDP, democracy – especially just voting
– is no vaccination against poverty (UNDP 2000a).
Human rights, for example, are conceptualized in terms of freedoms, a
strategy that conceptually links rights with the notions of capabilities and enti-
tlements at the core of human development. The Human Development Report
2000 (UNDP 2000b) talks about freedom from discrimination, want, fear, and
injustice; freedom for the realization of people’s human potential and decent
work; and freedom of participation, expression and association. If human
development shifts the conceptualization of development and poverty from a
matter of charity to a matter of justice, then human rights approaches add
analytical force to the implementation of human development, since rights
place claims on others (individuals or institutions) to satisfy them. Rights entail
duties, and duties bring with them responsibility, accountability, and culpa-
bility; all these concepts point to an agency-based approach to development
and poverty. Given that human development, as we have seen above, focuses
on the social arrangements or infrastructures provided by society to enable
people to live fulfilling lives, rights approaches bring possible tools to locate
accountability for failures in the social system and responsibilities for present and
future tasks (Sen 2000b). In short, among other issues, human rights analysis
involves assessments of the extent to which institutions and social norms are or
should be in place to provide security to the human development achievements
within society (UNDP 2000b). Last, UNDP rightly points out that the fulfil-
ment of rights must be distinguished from their mere existence. Indeed, many
rights go unfulfilled precisely because of the failures of duty-bearers to
perform their duties. There is nothing rhetorical about endorsing rights, even
if those do not have clear duty-bearers. In the absence of a world citizenship
or an institutionalized legal order, human rights provide the sole legitimation
for the politics of the international community (Habermas 1998b). Human
rights expand the scope of human development as well, as they have expanded
UNDP’s measuring indices to the point of using the cognitive tools of
simplicity and measurability as a power for advocacy and accountability of the
freedoms named above.
Ideas as tools for a learning process

The conceptual evolution of UNDP from focusing on poor countries to focusing
on the enabling environment that encourages and allows – or does not
encourage or allow – for the self-realization of people’s ways of life, is an ambi-
tious project that has become more and more explicitly normative. This project
has increasingly included ethical concerns, which some claim are the product of
Western values. Also, some may see UNDP’s ideas as technocratic, grounded
only in Northern knowledge and science. UNDP’s evolution may thus be marked
by a tension provoked by the many possible ways to answer the question: Who,
and for what reasons, decides what is best for the poor? Many of the techno-
cratic and market-based values espoused in the 1960s remain on UNDP’s
agenda, thereby creating a conflict of values. The strategy of taking the particu-
larities of the lives of the poor as a point of departure for poverty reduction
policies, the goals of opening people’s choices and respect for the natural envi-
ronment, or the emphasis on human rights, may sit uneasily with technocratic
rationality – and the aim of continuous economic growth, and the market-driven
diversification of human wants brought about by the apparently inevitable
consumerist side of development.18, 19
It has been argued that UNDP’s increased normativity is not the result of
an effort to include more worthy goals based on the assumption that the poor
are moral agents, but rather a ‘default’ strategy – a way to justify its existence
given its lack of practical power. It is true that there is a discrepancy between
UNDP mandates and principles, and its economic capacity. But to claim that
UNDP is normative by default undercuts the importance of normative justifi-
cation, especially when such justification has some power to appeal to people’s
reason and commitment – as is the case, I argue, with human development.
Aspiring to normative ideals can and should lead UNDP and other multilat-
erals to seek more effective power precisely to protect people from exploitation
and repression.
It is also relevant to note that unlike the World Bank, for example, UNDP has
a democratic voting system that assures, to a certain degree, the presence in its
ideas of various values and worldviews as well as universal membership. Indeed,
the UN as well as the Economic and Social Council (ECOSOC) are normative
institutions: their role is to promote norms and principles, many of them stated
in the UN Charter, which are the result of deliberation among, and the non-
weighted consensus of, member countries. The egalitarian voting system of the
UN and the economically weighted system of the Bretton Woods institutions
have created a substantial philosophical gap between these two types of multilat-
eral institution. The latter have accepted the defence of the principles of the
market economy above any other type of principle, including ethical ones. If the
power of ideas were exclusively derived from their economic support, the
UNDP’s would have close to none, and that is simply not the case. Indeed, the
World Bank is now increasingly following the path marked by UNDP in its
conceptualization of development and poverty (World Bank 2000b). The preva-
lence of UNDP, in this case, can be partly explained by a real moral and
cognitive power in some of this organization’s ideas. Ideas are more important in
development than the public is led to believe. Governments around the world
have a stake in the HDR rankings, and moral blame is starting to be significant
where countries lag behind in certain rankings, even if full responsibility is not
assigned. And that is one of the first steps towards changes in social values and
eventually in policies.
I suggest that in order to characterize the evolution of ideas in UNDP, it is

more accurate to avoid the dichotomy of seeing UNDP as either a body of
knowledge that defends narrow interests or as defending universalistic knowl-
edge; one that explains the role of ideas in this agency beyond a standoff
between political and economic reasons. UNDP’s use of ideas in its policy
documents is not independent of politics, but neither is it reducible to politics.
In an important sense, UNDP’s conceptual evolution is an instance of conti-
nuity: a continuity of ethical values – to some extent suggested by critiques of
past failures – that revamps the role of development aid in terms of social
justice at the same time as it keeps the particularities of many of its ideas
open-ended. The changes brought about by the ideas of self-reliance and later
human development have shifted the focus of this multilateral from a univer-
salistic and algorithmic top-down approach, aiming at changing the way of life
of poor countries, to a learning experience aiming at utilizing poor people’s
values and knowledge as a valuable input for policy design. This process is not,
let me emphasize, unique to UNDP. The United Nations Fund for Population
Activity, for example, has also moved from traditional targets of family plan-
ning to broad issues such as reproductive rights or women’s freedom to choose
(see Chapter 5). Even the academic field of development economics itself has
undergone many changes, which in some formulations now includes concerns
for the human beings behind variables and structural adjustments, as well as
for the ethical values embedded in development projects and planning. UNDP
has not only borrowed from the new approaches of scholars such as Streeten,
Sen and others, it has participated in the process of learning to understand
and identify the many dimensions of poverty and of well-being that ought to
be taken into consideration when making development and poverty policies.
That is, it has moved to a different development paradigm that transfers the
social values of freedom, rights, and justice to development studies.20 The
values of social justice and democracy are not exclusive to the North. Sen
offers compelling arguments for the idea that most of their elements are also
found in many non-Western cultures. In addition, although it is true that
UNDP emphasizes the role of the market, this institution is viewed as a means
that must be corrected and balanced with other means (such as state regula-
tions).
Earlier sections of this chapter have shown that once UNDP began ques-
tioning some of the ethical implications of the goals and means of development,
it set into motion a process that had (perhaps unintended, but) far reaching
consequences. By questioning the ethical meanings of its goals, UNDP has
shifted its focus from poor countries and macroeconomic concerns to poor
people and their ways of living, and later to the infrastructures of society that
prevent or enable people to flourish. Indeed, once UNDP began conceptualizing
the poor as moral agents, it had no rational alternative to moving towards devel-
opment policies of greater social justice and democracy. First, the
problematization of development goals in ethical terms demanded the ques-
tioning of the means to achieve such goals. Second, questioning the ethical
content of means demanded the reconsideration of the goals they had to serve.
The continuous re-evaluation of the means to achieve human development is an
instance of such dynamic processes. Human rights and good governance are
used by UNDP as means to achieve, and in turn re-define, the goal of human
development.
However, UNDP must add to this process of open-ended re-evaluation of
goals and means a renegotiation of ideas, as the social settings of developing
countries change and the shared understandings between aid donors and aid
recipients evolve, which entails that the objectivity of the ideas that form
UNDP’s policies on poverty and development can only be such when seen from
multiple points of view (Hacking 1999; Putnam 1994). In other words, UNDP’s
evolution of ideas is a learning process, as long as we can reconstruct this evolu-
tion of ideas as a move from scientifically proven concepts rooted in the
experience of the North, to broad, open-ended, and pluralistic ideas for contin-
uous re-evaluation and public discussion. As long as UNDP concentrates on a
continuous renegotiation of knowing and valuing, this organization will not be
imposing a particular rationality or a particular set of allegedly exclusively
Western values. In fact, the ethical norms underlying many UNDP documents
since the 1990s are not based on a particular theory of value, but rather on a
theory of valuation. For example, the main normative emphasis of human
development is on a particular formulation of freedom based on Sen’s philo-
sophical work. And Sen argues at length that the freedom he refers to must be
conceived as something whose ‘real’ essence is unknown, because in practice
the idea of freedom refers not to one freedom but many. Furthermore, as long
as the poor are viewed as moral agents with their own particular social settings,
freedoms must be posed in the context of choice situations. The challenge for
UNDP, therefore, is to keep its ideas open to both academic and popular delib-
eration. Such emphasis on public deliberation and its connection to justice are
at the core of Sen’s conception of development as freedom (Sen 1999). Mahbub
ul Haq must certainly have been aware of this when he referred to human
development:
Here we have a broad framework; if you want something to be included in

this list, which may deserve a table in the Human Development Report (and
with incredible luck it may even be considered for inclusion in one of the
indices like the Human Development Index, or the Human Poverty
Index), tell us what, and explain why it must figure in this accounting. We
will listen.
(quoted in Sen 2000a)
Haq and Sen have raised the stakes high for UNDP. This multilateral agency
must keep its formulations of the good life open to democratic deliberation, and
this entails that the only reasonable way to proceed is by guaranteeing every party’s
participation, including the poor.
Notes
1 The research necessary for writing this chapter was funded by Norwegian Research
Council grant no. 141147/730. Thanks to Desmond McNeill, Morten Bøås, David
Crocker, Desmond Gasper, Nils Gilje, Inmaculada de Melo-Martin, Sanjeev Prakash
and Stephen Turner, for useful comments on an early version. Special thanks to
Richard Jolly for valuable empirical information.
2 Hoksbergen (1986) makes a similar point.
3 The Human Development Report 2000, for example, also links the moral and the non-
moral together, given it argues that there is an ethical duty to quantify the success and
failure of the goals posed by development.
4 Putnam (1990) makes a similar point.
5 The editors of this volume claim that the best theoretical framework to analyse the
role of ideas in multilaterals is a middle path between two theories of international
relations, constructivism and realism. Philosophically, constructivism refers to the
contingency of knowledge and realism and is related to the acceptance that objects
and facts are independent. As much as I acknowledge that knowledge is constitutively
a social product, it is important to distinguish between the ‘idea of x’ and x.
For example the idea of a woman refugee, which is but a classification of certain
type of woman, and the reality of women refugees. Certain social conditions in
certain countries force people into flight (or to flee for their lives), but we cannot
talk about social construction in that context. We must therefore distinguish
between ideas themselves and the matrix of that idea. The matrix in which the
idea of a woman refugee is formed, is a complex of institutions, advocates,
newspaper articles, lawyers, court decisions, [or] immigration proceedings.
(Hacking 1999: 11)
6 The merger was ratified by Resolution 2029 (XX) on 22 November 1965, and UNDP
started functioning in 1966.
7 A UNDP document claims that technical assistance was ‘an inexpensive means of
assisting and uplifting the world’s poor. A few skills imparted, some techniques trans-
ferred, key people trained, some basic equipment provided and the developing
countries would move in unison into the thriving tumult of the world industrial
economy’ (UNDP 1985).
8 Chenery et al. (1974) argued in that direction and aimed to demonstrate that the right
type of distribution would benefit everyone.
9 The World Bank was also instrumental in the spread of this new idea about develop-
ment and poverty. In his address to the Board of Governors in 1973, McNamara
pledged the reorientation of development policies towards the achievement of basic
needs for all (McNamara 1981).
10 It is important to notice that there were substantial differences between the use of
basic needs by multilaterals and the conceptualizations of their creators, Mahbub ul
Haq and Paul Streeten. The move from academia to policy distorted this approach in
a considerable way. For important contributions to the understanding of basic needs,
see Doyal and Gough 1991; Stewart 1985; Streeten et al. 1981; Streeten 1984.
11 I am assuming here that UNDP policies since the 1970s have become more poverty-
oriented. But in an important sense that is not so straightforward as UNDP seems to
believe.
12 This shift from inputs to outputs is very important. Bureaucratic structures usually
concentrate on measuring inputs. A focus on outputs requires an elasticity that
bureaucratic structures usually do not have. This points to a peculiar characteristic of
UNDP: its capacity to decentralize more easily than other multilaterals, to be more
elastic and therefore to tune in easily with the recipients of aid.
13 See Cornia et al. 1987–88.

14 UNDP administrator from 1976 to 1986.
15 See Desai 1979; Nyerere 1968; Prebisch 1971.
16 For an analysis of the ethical foundations of Sen’s capability approach and its differ-
ences with philosopher Martha Nussbaum’s formulation of capability, see Crocker
1995; Gasper 1997.
17 See World Bank 2000b.
18 For a substantial discussion on these conflicts, see Wolfe 1996.
19 For substantial postmodern criticism of the discourse of development, see Cowen and
Shenton 1996; Escobar 1995b; Rist 1997; Sachs 1995.
20 It is important to notice here that although some of these later conceptualizations
take social justice as the thrust of development aid, there are many reasons to believe
that charity will still have an important role to play. For a substantial discussion of the
role of charity in development aid, see Gasper 1999.
14 The power of ideas
Across the constructivist/realist divide
James J. Hentz
Introduction
Unquestionably, the West, and in particular the United States, controls the key
multilaterals (Woods 1999: 9). The US dominates the weighted voting in the
IMF, and the primary producer clause of the WTO codifies the West’s leading
role in shaping the international trading order. However, international institu-
tions also increasingly play an autonomous role. In fact, it was the relative
decline of the US that pushed multilateral institutions into a prominent role.1 As
Escobar argues, albeit in a different context, ‘from these institutional sites’
(Escobar 1995b: 41) flows the ‘process of institutionalisation and professionalisa-
tion’ (ibid.: 45) of dominant forms of knowledge, or in the context of this volume
– ideas. This, nonetheless, is not a tale of metropolises and peripheries because it
describes:
not epistemological centers and peripheries but a decentralized network of

nodes in and through which theorists, theories, and multiple users move and
meet, sharing and contesting the socioepistemological space.
(ibid.: 224)
In fact, powerful factions within developing countries can be convinced

through a discourse with multilaterals that certain developmental ideas are in
their interests. As such, interests are often treated as distinct from ideas, when in
fact ideas help shape interests. But this can only happen if configurations of
power at the domestic level can sustain such policies. This demands bringing the
state back in, not necessarily as an actor, but as an arena (or node) and as an
active agent in the production and reproduction of a structure of dominant
knowledge. In Ferguson’s words:
The ‘state’ in this conception, is not the name of an actor, it is the name of
a way of tying together, multiplying, and coordinating power relations, a
kind of knotting or congealing of power.
(Ferguson 1990: 273)
194 James J. Hentz
How do ideas trigger new policies and transform institutional arrangements?

What makes an idea attractive? The answer rests in the interstices of the persua-
sive power of an idea, ‘knowledge politics’, and the material power of that idea.
In international politics, the former is often explained by the diffusion of
successful policies that act as avatars of a particular idea. But ideas do not exist
in isolation from the broader political context. Ideas are part of a larger competi-
tion pitting the relative power of different ‘civilizations’ against one another, and
this competition has interlocking international and domestic dimensions. In the
context of this volume, ideas are part of the developmental discourse, which has
marginalized and disqualified non-Western knowledge systems (Escobar 1995b).
These ideas, nonetheless, become locked in at the domestic level, which is an
essential part of the agent/structure dynamic. This is part of what Ferguson calls
the ‘instrument-effects’ (Ferguson 1990). Ideas are marketed as technical solu-
tions to developmental problems (Ferguson 1990; Escobar 1995b), but they come
packaged as political solutions favoured by powerful domestic actors.
The power of ideas, therefore, rests not just in their innate logic or even their
essential correctness, but also in how they are embedded in material forces for
change (or inertia), including structural transformations (from a bi-polar to a
multi-polar or to a loose hegemonic international system), the actions of transna-
tional actors and the rational behaviour of domestic agents. To answer the
questions posed at the start of this chapter we need a framework that explains
how the ideational and material power of certain policy choices lead states down
specific pathways of development. A constructivist approach does the first, and
reintroducing a realist approach does the second. Certain ‘ideas’ contribute to
both the development of new policy approaches and to institutional innovation
and change.
Constructivism provides the essential analytical tools for understanding
ideational influences in international politics. The spread of new ideas is not
merely due, for instance, to the financial power of the International Financial
Institutions (IFIs), or other international organizations. It is also because indi-
vidual governments develop ownership of those ideas (Hanson and Hentz 1999).
The ability of multilateral institutions to establish a global consensus around
certain ‘ideas’ is conditioned by an intersubjective process of learning. But this
process can neither be understood outside its structural context, itself contested,
nor abstracted from domestic political contests (Bøås 2001b). In both cases
power matters.
Constructivism argues that not only is it important to explain the intersubjec-
tive nature of interests, but that structures and agents reconstitute each other in a
dynamic process of iteration (Klotz 1995). The agent/structure model acknowl-
edges that structure alone explains only the possibilities of action (Wendt 1987).
In Dessler’s words: ‘A complete explanation must also appeal not only to the
material [structural] but also the efficient causes of action, which can be located
only within a theory of agents’ (1989: 445). This is why an agency complement
to the systemic elegance of constructivism is necessary. Its ontology of mutual
constitution means that the process of interests formation and the institutional-
Across the constructivist/realist divide 195
ization of interests flow from agent to structure as well as vice-versa. To unlock

the analytical power of the agent/structure approach the rationalist/construc-
tivist dichotomy must be bridged.
Although constructivism has opened the door to a better understanding of
ideational influences in international politics, this chapter argues that without a
realist complement it falls short of its ambition. The argument is made in three
parts. First, I look at the constructivist critique and why its analytical power falls
short of its purpose. Second, I look specifically at ideational explanations in
international relations. Third, I offer a realist complement, which draws on, in
particular, classical realism but includes elements of neorealism and postclassical
realism.
The constructivist critique

The role of ideas in international relations theory has been the province of
constructivism. As Katzenstein argues: ‘State interests do not exist to be discov-
ered by self-interested rational actors. Interests are constructed through a process
of social interactions’ (1996: 2). Economic liberalism, for instance, as Wendt
might expect, has been the catalyst for new interest formation (1992). However,
while constructivists assert a state’s interest formation is global (Klotz 1995), as
March and Olsen relate, ‘[H]istory is created by a complicated ecology of local
events and locally adaptive actions’ (1998: 968). The inability of rationalist
approaches in international relations, both neorealist and neoliberalist variants,
to explain how interests are formed, is well covered in the literature and will not
be canvassed here.2 The most often-repeated challenge to rationalist approaches,
as Bukovansky reiterates, is that ‘interests may be reconstituted in the political
process’ (1997: 211). Rationalist approaches treat interests as exogenous, when in
fact they are an endogenous part of the political process. This, of course,
includes the role of ideas and the construction of social knowledge within and
across national boundaries.
There is, however, a second problem with rationalist approaches that is most
prominent in constructivism’s favourite sparring partner – neorealism; that is, the
role of reason in international relations is ignored. But it goes largely unchal-
lenged in the constructivist critique because, I would argue, constructivism
conflates the positivism of neorealism with the rationality of the rational actor
assumption it shares with classical realism (and rational choice). Constructivism
thereby ignores not only classical realism’s nuanced appreciation of power, but
also the implicit role of reason in some positivist approaches. Also, while both
neorealism and rational choice are positivist theories (or approaches), their
respective understanding of the link between reason and rational action is
distinct, and not only because they largely operate at different levels of analysis.
Neorealism explains the reasons for actions, or as Ikenberry and Doyle argue,
‘neorealism is preoccupied with the consequence rather than the cause of struc-
ture’ (1997: 271); rational choice is concerned with the reasoning behind actions.
This also distinguishes neorealism from classical realism. For instance, for
196 James J. Hentz
Thucydides the actions of states are grounded in the decisions of individuals

(Bagby 1994). Forde (1995) has argued that the simplifying assumptions of
neorealism, in particular the assumption that states are unitary actors, ignores
the rich analysis of, among other non-systemic forces, domestic politics. If, as
argued here, the agency side of the agent/structure process is under-examined,
we must look at the reasoned behaviour of domestic actors. In an approach
focusing on ideas flowing within, and concurrently constituting, the agent/struc-
ture process, the reasoning behind behaviour is as important as the consequence
of structure on that behaviour.
Constructivism is a self-conscious challenge to the positivist ontology of both
realism and rational choice. It is only natural that in carving out its own analyt-
ical space in international relations theory, it focused on the differences between
its own approach and positivist theories. However, in the process, constructivism
misses the opportunity to form synergies that will shape IR theory, if not (unfor-
tunately for those that enjoy this game) ferment the next meta-debate in IR (e.g.
Katzenstein et al. 1998). Elements of realism, particularly classical realism, as
well as of rational choice, complete the analytical power of constructivism.
While the constructivist critique is essential for understanding the role of
ideas, it is, therefore, incomplete. First, it lacks an appreciation of power.
Classical realism, and even neorealism, can complement the ideational focus of
constructivism. For instance, the importance of diffusion in constructivism’s
explanation of the spread of ideas is similar to the ‘sameness effect’ of neore-
alism (Brooks 1997). The hegemony, in a Gramscian sense, of certain
developmental discourses, is partially a product of solidified Western hegemony
in the immediate post-Cold War era, and in the ability of the multilaterals that
anchor that hegemony to shape and spread those discourses. Among and within
these multilaterals there is a competition to produce ‘good’ ideas.3 Second,
constructivism lacks a theory of agency. In fact, both neorealism and construc-
tivism are agent/structure theories, with weak theories of agency. As Jervis,
citing Waltz, explains: ‘Waltz’s conception of the relations between the units and
the system is not so different from theirs [constructivist]’:
B’s attributes and actions are affected by A, and vice-versa. Each is not only
influencing the other, both are being influenced by the situation their inter-
action creates. … The behavior of [a pair of units in a system] cannot … be
resolved into a set of two-way relations because each element of behavior
that contributes to the interaction is itself shaped by their being a pair.
( Jervis 1998: 978)
While neorealism cannot explain how interests are formed, constructivism

cannot explain how those interests become institutionalized. As Biersteker
argues: ‘The reception of ideas in a particular national context is rarely identical
from country to country’ (1995: 175). We must understand how they are
embedded in, and shape domestic political institutions where actors deploy
whatever means necessary to further their interests. As Legro states: ‘This over-
sight has led scholars to ignore significant subsystemic social understandings that
can contradict and overwhelm international prescriptions’ (1997: 32). An instru-
mental complement to the intersubjective ontology of constructivism is
necessary; a theory or model of agency is therefore essential, to complement a
constructivist explanation of interest formation.
Ideas as ‘materials for action’ is the central explanatory variable. Ideas, specif-
ically learning, can account for new interest formation. But, as Hall states: ‘Ideas
have real power in the political world, [but] they do not acquire political force
independently of the constellation of institutions and interests already present
there’ (1989a: 390). Part of that constellation is a web of multilaterals and
academics promoting certain ideas. That is, ideas inform policy not only because
they are vested in interest, but also because they become embedded in institu-
tions (Sikkink 1991; Biersteker 1995).
Constructivism’s anti-positivist ontology led it to mimic neorealism’s systemic
bias and to largely ignore the dynamics of domestic politics. In fact, much of
constructivism was more forgiving of neorealism’s unitary actor assumption than
of neoliberalism’s individualism (for which it claimed greater affinity). It has also
ignored the central place of power in politics.
The structural power of ideas

Stein states, ‘[C]hanges in the nature of human understanding about how the
world works, knowledge, can also transform state interests’ (1993: 49). In
Maynard Keynes’ famous words: ‘The power of vested interests is vastly exag-
gerated compared with the gradual encroachment of ideas’ (cited in Odell 1982:
12), and as Jervis states, ‘actors who believe the theory of mercantilism will
behave very differently from those who have been schooled in neoclassical
economics’ (1998: 976).
The central conundrum in most of the ideas literature remains, nonetheless,
how to prove causality (Goldstein and Keohane 1993; Garrett and Weingast
1993; Yee 1996), or how to show that ideas are more than mere hooks that
competing elites use to legitimize and promote their interests. In fact, this is what
distinguishes constructivism from the classical realism of E.H. Carr. Carr well
understood that laissez-faire economics was ‘a cloak for the vested interests of
the privileged’ (cited in Burchill 1996: 69). His notion that the harmony of interest,
which was at the centre of Woodrow Wilson’s idealism, was a fallacy, was based,
ironically, on an implicit acceptance of the Marxist dictum that the ruling ideas are
the ruling-class ideas.
Unfortunately, the literature on ideas often conflates ideas and ideology.4
Getting past the chicken and egg problem and imputing causal significance to
ideas demands separating independent and dependent variables, and thereby more
clearly explaining cause and effect. If ideas are merely one way, among others, to
promote interests, which are already given, they do, indeed belong to the ratio-
nalist paradigm. Institutionalist explanations of interest formation, for instance,
typically treat ideas as epiphenomenal, or use them as post-hoc explanations (see
198 James J. Hentz
Blyth 1997). Ideas are treated either as weapons used by competing elites, or one
set of interests among others that powerful groups are promoting. But ideas are
this and more. The causal power of ideas rests in their ability to redefine state
interests. As Ernst Haas stated: ‘learning is but one other word for reinterpreting
one’s interest’ (1980: 370). Learning is stimulated by the introduction of new ideas,
but not just any kind of idea will suffice.
An argument using the spread of neoliberalism to demonstrate the power of
ideas demands confronting powerful materialist counterfactuals,5 such as the
structural power of international capital and the hierarchical ordering within
multilaterals. But which ideas are promoted cannot be explained by purely mate-
rial factors, nor why some gain traction and others do not. Finally, as Blyth
cautions, ‘Attributing a change in behaviour to a change in ideas is tenable only if
it is counterfactually demonstrated that the change could not have occurred
without the ideas’ (1997: 236). This does not imply that ideas must be proven
sufficient for change, but only that they be shown to be necessary for change.
Political actors competing to promote policies favouring their interests are the
intermediaries through which a state’s interest is defined, or redefined. Ideas have
causal power; that is, they ferment policies, precisely because of their advocacy by
powerful groups. If, returning to Haas’ dictum, ‘learning is but one other word for
reinterpreting one’s interest’, what we want to know is what ideas triggered such
learning and how (if ) those ideas have defined or redefined a state’s interests – its
broad objectives of policy. As Nau argues, the policy process is more than interest
(society) and institutions (state). There is a competition within what he calls a
‘cocoon of non-governmental actors’ (1990: 44). That competition plays out on
the ideational plane as well as the political, and each influences the other.
Finally, this volume’s historical perspective highlights the ebb and flow of
ideas within Nau’s ‘cocoon of non-governmental actors’. At different times
particular ideas seem to capture the attention of multilaterals: the informal
sector in the 1970s, sustainable development in the 1980s, and governance and
social capital into the twenty-first century. In remains to be seen how ideas
become locked in, and this reminds us to examine how states gain ownership of
those ideas.
Bringing realism back in

The strength of constructivism rests in its agent/structure framework. The inter-
national system and its constituent parts interact to constitute and reconstitute
each other. Part of this process is the creation and dissemination of ideas that
shape states’ identities and interests. Multilaterals, such as the World Bank,
United Nations Development Programme, the International Labour
Organization, the Asian Development Bank, the African Development Bank and
the Inter-American Development Bank, in partnership with academic institu-
tions such as the Institute for Development Studies in Sussex and the Harvard
Institute for International Development, powerfully influence the formation of
those meanings and identities.
However, until recently, constructivism has focused on historical transforma-

tions (Klotz 1995), and on a debate over competing ontologies for understanding
systemic change (Bukovansky 1997). There are good reasons for this; Checkel
(1998) points out that constructivism’s core criticism of international relations
theory was the latter’s materialism and methodological individualism. But, as
with an earlier challenge to structural realism, constructivism has done battle,
almost exclusively, on the systemic plane,6 and ignored domestic politics
(Keohane 1989; Ferguson and Mansbach 1991). Thus, while recent work in the
constructivist mode has begun to focus on policy choices (Klotz 1995; Risse-
Kappen 1995; Bukovansky 1997), their analytical frameworks tend to have
under-specified theories of domestic behaviour.7 Klotz, for instance, acknowl-
edges the lack of determinism in her explanation (1995). Kowert and Legro
state:
the relationship of normative to material structures is rarely examined or

explicitly theorized, despite the likelihood that the influence of norms may
be related to the characteristics of the material structures in which they are
imbedded or the qualities of the actors that adopt or promote them.
(1996: 490)
Constructivism, nonetheless, has left room for a theory of agency. First, as

Wendt has argued, there is a natural affinity between constructivism and neolib-
eralism, because the latter is about process, including interaction and learning
and about institutions (1992). Recent constructivist explanations of empirical
events at least implicitly acknowledge that the domestic side of the agent/struc-
ture framing of their analysis is important. The recursive nature of the
intersubjective meanings, or learning, depends on the institutionalization of
those meanings (or ideas) at the state level.8 But, because constructivism lacks an
explanation of power, it also must call on realism.
Realism has been called the dominant international relations theory of post-
World War II America. As such, it has become a favourite straw man of
competing theories, such as neoliberal institutionalism and constructivism. But in
the process, it has become almost a caricature in IR. As is increasingly being
noticed, there are competing realisms: neorealism; postclassical realism and clas-
sical realism. Each offers important insights, but classical realism offers the best
complement to constructivism.
Following World War II, American neorealism moved away from its
European roots (Deudney 1997: 97). The positivist agenda of neorealism, exem-
plified by Waltz, replaced rationalism, and reason, with sparse economic
assumptions of utility maximization and homo economicus. Elster (1984, cited in
Kahler 1998: 924) argues that pure structuralists deny the importance of
rational choice in favour of structural constraints. Waltz, in fact, purposefully
challenged the anti-scientific traditional approach originally promoted by
modern classical realists such as Hans Morgenthau and E.H. Carr. The result, as
Kahler nicely summarizes, is:
200 James J. Hentz
The realm of reason within neorealism remains ambiguous. Under tight

structural constraints of international competition and selection, the ratio-
nality of agents seems superfluous.
(1998: 925)
Waltz’s systemic theory has its own mirror weaknesses to constructivism.

Waltz states: ‘In a systems theory, some part of the explanation of behaviours
and outcomes is found in the system’s structure’ (1979: 73). Structure, for Waltz,
is defined by how the units stand in relation to one another (ibid.: 80). And for
Waltz, like most realists, states are the units that define the structure. Most
importantly, however, unlike systemic constructivism, Waltz argues that ‘[S]truc-
ture is sharply distinguished from actions and interactions’ (ibid.). Neorealism not
only could not explain system change, such as from the Medieval system to the
Westphalia system (Ruggie 1972), but the structural change from the bi-polar
world of the Cold War to the multi-polar (or loose hegemonic) world of the post-
Cold War era (Lebow and Risse-Kappen 1995).
Brooks has introduced what he calls postclassical realism (1997). He looks at
the work of a number of contemporary realists, such as Robert Gilpin, John
Mearsheimer and Stephen Walt, and notes that collectively they, and others,
have introduced three new material factors to neorealism: technology; geog-
raphy; and international economic pressures. However, he also claims that
postclassical realism ‘focuses on international-level factors and does not examine
domestic political variables’ (1997: 469). Postclassical realism is an improvement
over neorealism because it brings back in essential players and processes, such as
multilaterals and international economic pressures, but it is inadequate for
building a realist agent/structure model.
Within classical realism there are significant differences, such as between the
classical realism of Thucydides and Machiavelli and the post-World War II
realism of Carr and Morgenthau. But unlike neorealism, or postclassical realism,
traditional realism neither ignored nonmaterial influences, nor the importance of
the second level of analysis. Carr and Hans Morgenthau are the central figures
in post-World War II traditional realism. Carr, a historian, sought to build a
scientific study of world politics that accepted the realities of power. Morgenthau
sought to create a ‘science of international politics’ by adopting a positivist
methodology, such as that advanced by the hard sciences after World War II, to
international relations (Burchill 1996). He can be considered, along with system
theorists such as Morton Kaplan, as a transitional figure between classical
realism (brought over from Europe) and neorealism.
Both Carr and Morgenthau, as representatives of the classical tradition, have a
fuller understanding of the use of power. For instance, Morgenthau argued that
the political, cultural and strategic environment would largely determine the
forms of power a state will use (Burchill 1996). In his list of the ‘elements of
power’, he includes: ‘national morale’: an ‘intangible factor without whose
support no government … is able to pursue its policies’ (Morgenthau 1949: ch. 4).
Carr’s multisectoral approach, as well, expands realism’s reach. Most importantly,
Carr understood the idea of language as power, and that discourse helps shape
politics (Buzan 1996). In fact, as Buzan (1996) notes, even post-structuralists such
as Der Derian and Robert Ashley have found classical realism useful.
Waltz argued that classical realism was limited by its behaviourist method-
ology, which explains political outcomes by studying the constituent parts of a
political system (Burchill 1996). This led to the curious anomaly, from a neorealist
perspective, of what is a rational institutional design, from a rational choice
perspective, being irrational from the perspective of a state trying to survive in the
international system. Classical realists understood this dilemma. Thucydides
noted that states do not always act in a way that maximizes self-preservation
(Bagby 1994). Neither was Machiavelli wedded to the principle of the rationality
of international actors (Forde 1995). The individualist ontology of rational choice
is apparently in direct conflict with structural realism because it does not neces-
sarily lead to optimal state behaviour. States often act irrationally. Conversely,
state behaviour in the face of structural constraints may conflict with what
rational choice might expect at the domestic level. Rational choice and neore-
alism can offer different and conflicting predictions of ‘rational’ state behaviour
because what is rational is defined by the a priori choice of your level of analysis.
The agent/structure model can square the circle. Examining systemic or
domestic logics in isolation cannot solve the riddle of rationality in international
politics, particularly in times of change. The dynamic interaction of agent and
structure creates its own logic. As Ikenberry and Doyle explain:
The key to a middle position … lies in relaxing the ontological primacy of

either states (self-interested states) or international institutions and in intro-
ducing interactive processes into the relation.
(1997: 273)
The end of the Cold War, of course, changed how the units stand in relation
to each other – a structural change. But Waltz’s omitted variables are key for
explaining this. One constructivist explanation of how the international struc-
ture was changed through the actions and interactions of transnational actors
illustrates the weakness of neorealism. Stein argues that the Soviet Union’s reac-
tion under Gorbachev to economic decline is partially explained by the influence
of new thinkers, whose ‘international contacts facilitated the exchange of ideas
between transnational communities and the development of mutually under-
standable vocabularies and concepts’ (1995: 241). Transnational relations
influenced the dynamic interplay of domestic political forces in the Soviet
Union, which led to a redefinition of its security interest (Deudney and
Ikenberry 1991/92). The Soviet Union ‘learned’ that it had to make a tradeoff
between immediate security (a continuing emphasis on heavy industry and
defence spending) and economic reform. The difference, as Brooks points out, is
concern for short-term military security versus long-term military security
(1997). Neorealism argues that states heavily discount the future and thus would
not make such a decision. The Soviet Union should not have allowed its vassal
202 James J. Hentz
states to become independent nor loosened its grip on Eastern Europe.

Ultimately, embedded in a reconstitution of its own interests that was strongly
influenced by transnational activity, the Soviet Union’s decisions led to a recon-
stitution of the international system (Koslowski and Kratochwil 1994).
An agent/structure model of realism that incorporates non-state actors is
necessary. In this volume, multilaterals are the medium through which transna-
tional ideas influence the development policies of individual states. But without
incorporating how power affects relationships you end up with indeterminate
explanations for how transnationalism affects policy. For example, the literature
on epistemic communities suffers from this problem, because it fails to specify the
conditions under which specific ideas are selected (Garrett and Weingast 1993;
Risse-Kappen 1995).9 Epistemic communities built around specific ideas can
compete with each other, something academics should surely understand.
Epistemic communities do not operate in vacuums. A vignette from the post-
World War II era can illustrate this point. This concerns the broader globalization
process of neoliberal economics and describes an epistemic victory and defeat.
The dominant economic idea of the post-World War II era was Keynesianism, as
reified in the Keynesian Welfare State (KWS). The strength of this idea cannot be
understood outside the context of the Cold War. In Hall’s words:
By articulating an image of the managerial state that endorsed a measure of

state intervention but preserved the capitalist organization of production,
Keynes reinforced the belief that a middle way could be found between the
complete socialization of the means of production and the excess of unbri-
dled capitalism. … They [Keynesian ideas] contributed to a change in the
very terms of political discourse after the Second World War. They provided
a new language that diverse groups of political actors could use to forge a
common purpose, and conception of the state’s role in the economy that
appealed to forward-looking conservatives and Social Democrats alike.
(1989a: 366)
The KWS was an essential tool in the West’s defence against the spread of
communism, which had intuitive appeal to the war-torn societies of Western
Europe. Without the Cold War, the structural imperative of the KWS is lost. But
it also had facilitated domestic political coalitions necessary to support the edifice
of the KWS.
Constructivism must account for domestic political power struggles, and the
nature of state institutions. A realist agent/structure model would expect that
these would be reconstituted and constitute the international system. Carr
understood this relationship:
The predominance of the manufacturer and the merchant was so over-

whelming that there was a sense in which an identity between their
prosperity and British prosperity as a whole could be correctly asserted.
(1964: 81)
And as Jervis argues, rational choice has something to add here:
Game theory rests on assumptions about each actor’s expectations about

how the other will behave, expectations that form socially, both through
establishing conventions about the meaning of behavior and by actors
trying to convince others to accept their explanations.
(1988: 978)
Reason, taken out of the neorealist mix, needs to be thrown back in. And
ideas, or ‘knowledge politics’, play out within and shape domestic political
contests, which are strongly influenced by and embedded in transnational
activity. Constructivists understand this, but the ability of ideas to penetrate
states can vary. As Risse-Kappen argues, state characteristics may facilitate or
inhibit the flow of external ideas (1995). But Risse-Kappen treats state charac-
teristics as given, and little attention is paid to the fact that states themselves
adopt institutional arrangements deemed necessary to adapt to a changing inter-
national environment. The Parliamentary Reform Act of 1832 in Great Britain,
for instance, revised the system of representation, reducing the power of the
landed elites. Without this institutional change, the Corn Laws could not have
been repealed. It was, thus, a reflection of, and an institutionalization of, the
growing power of the industrial class. Eichengreen, for example, argues that the
coalition of specific agricultural and industrial interests that supported the
Smoot-Hawley Tariff was successful because of reforms in Congressional proce-
dures (Eichengreen 1989).
The literature on globalization acknowledges the central role state institutions
play in either promoting or inhibiting that process.10 Maxfield argues that
economic policy is likely to reflect bankers’ preferences under three conditions: an
independent central bank, if the finance ministry is allied with the central bank
and exercises hegemony over other ministries, and if state industrialization or
planning authorities have little ability to control the flow of investment funds
(1990). Other scholars argue that globalization occurs more easily where there is a
concentration of state power (Pantich 1997). But how particular institutional
configurations come about, or how they might change, is not addressed. The
causal arrows actually flow both ways. As Bradshaw and Zwelakhe argue, the
penetration of foreign capital influences state characteristics (1990). Globalization
strengthens certain ministries, typically including finance (Cox 1992a),11 and
these ministries gain strength because, as Haggard and Lee (1993) argue, a
concentration of banking/industrial economic power reinforces the power of
groups in favour of economic liberalism. In South Africa, for instance, Kornegay
and Landsberg argue that a Keynesian economic strategy would demand a
central role for the Ministry of Public Works, ‘which curiously seems to have
adopted a low profile’ (1998: 9). The point is, of course, that a monetarist
economic strategy privileges other departments, such as finance and the reserve
bank. Interests and states are typically treated as separate analytical entities, but
they are better appreciated as being mutually constituted.
204 James J. Hentz
In the case studies, the idea of ‘good governance’ is an example of ideas

translated through multilateral bargaining shaping state institutions. The idea of
good governance is closely linked to the state-market debate, and in the African
context to structural adjustment programmes. As such, it is about creating strong
Weberian states out of the wreckage of patrimonial states.
Conclusion
International relations should now build on constructivism’s contributions. This
will entail, however, not further ontological and epistemological entrenchment
where rationalist and reflectivist continue to take shots at each other across the
metatheoretical battlefield, but rather an exploration of the terra incognita in
between. This can include post-structuralist analysis of development.
In fact, although this contribution does not take a post-structuralist posi-
tion, it is consistent with Nustad and Long’s chapters. Both focus on the
development discourse from below, claiming that a technocratic discourse
from above ignored the importance of human agency from below. From a
critical perspective, a positivist/technical discourse of development domi-
nated by the West and its multilateral surrogates entrenches power relations
between North and South. As Nustad points out, Truman’s faith in scientific
and expert knowledge was part of his anti-communist crusade. Similarly,
Waltz’s neorealism has often been labelled conservative. To use Ferguson’s
phrase, ‘the anti-politics machine’ is cloaked in positivist rhetoric and
discourses obscuring political processes and their underlying power relation-
ships. Whether the current international system is most accurately
characterized as multi-polar or loose hegemonic, the power of multilaterals in
international politics is still hierarchically arranged (Woods 1999).
Nonetheless, because agents can affect the structure, the participation of
developing countries in the larger developmental discourse can abrade the
strict hierarchical arrangement of international politics.
The case studies presented provide a rich vein for testing the framework of
analysis offered here. The varied pace and impact of different ‘ideas’ across time
can be explained by a realist agent/structure model. This chapter has therefore
avoided framing the latest dichotomy in international relations as being positivist
vs. interpretive,12 because as constructivism can demonstrate, societal interests
and state institutions are continually reconstituted within a process of reconsti-
tuted interests, where the web of multinationals imbued with the power of ideas
operates.
Notes
1 Hegemonic Stability Theory predicted a decline of the international economic
system as the US slid off its hegemonic perch. However, the international institutions
created during the early post-World War II years sustained relative stability. For a
complete discussion of the central role of international institutions, see the writings of
G. John Ikenberry (1993; 1996).
2 For discussions of this problem see Sandholtz (1993), Wendt (1992) and Cohen
(1990).
3 Although not covered in this chapter, this competition includes alliance-building
between multilaterals and academia, as well as between multilaterals and specific
domestic interests within certain developing countries.
4 For instance, Emanuel Adler (1997) in his seminal study on ‘power of ideology’ never
seems to untangle the two. He considers ideologies as a ‘specific type of idea’, but
uses ideas and ideology as seemingly mutually reinforcing by repeatedly pairing them
together.
5 For a similar agrument see Biersteker (1995).
6 Robert Keohane and Joseph Nye (1987) acknowledged the importance of linking a
process-oriented version of systemic theory with an analysis of domestic politics, but
purposefully limited their analysis to the level of the international system. The subse-
quent literature, as they later pointed out, followed their lead.
7 Two possible exceptions are Risse-Kappen (1995) and Legro (1997). The former uses
different state structures to explain the power of ideas. This might be considered a
reification of the state, since state structures are given. The latter uses the cultures of
national military organizations to specify which norms matter.
8 Kratochwil (1989) and Keohane (1989) both acknowledge the importance of institu-
tionalizing norms, but do not go far enough in explaining the robustness of those
institutions.
9 Blyth (1997) argues that the two main schools of institutionalist theory that focus on
ideas, historical institutionalism and rational institutionalism, suffer from this
problem. The examples he uses for the former are the works of Peter Hall and
Kathryn Sikkink, and for the latter Judith Goldstein and Robert Keohane’s edited
volume, Ideas and Foreign Policy (1993).
10 For an example of the former see Garrett (1995).
11 Weeks (1996) has claimed the same for countries in Southern Africa adopting struc-
tural adjustment programmes.
12 See Keohane (1988) and Adler and Haas (1992).
15 Ideas and institutions
Who is framing what?
Morten Bøås and Desmond McNeill
‘The question is’, said Alice, ‘whether you can make words mean so many
different things’. ‘The question is’, said Humpty Dumpty, ‘which is to be master –
that’s all’.
(Lewis Carroll, Alice’s Adventures in Wonderland )
Introduction: power and ideas

The role of ideas in the making of multilateral development policy is the main
concern of this book. In drawing conclusions from the various case studies
presented here, we seek to avoid two extreme positions, which may be briefly
summarized – or even caricatured – as follows.
Alternative 1 Multilateral development policy is determined by institutions driven

by the common good. New ideas are welcomed, and those which are well
founded empirically and analytically are adopted as the basis for decision making.
Alternative 2 Development policy is determined by neoliberal forces, epitomized

by the US Treasury, which use multilateral institutions to further their own
agenda. Ideas that run counter to this agenda are either suppressed or distorted.
The former is politically naive, ignoring the fact that there are powerful interests
at stake – both internationally and also within and between different multilateral
institutions. The latter is simplistic, ignoring both the power of ideas and institu-
tionalization, and the complexity of power relationships within multilateral
institutions. For us, the challenge lies not in simply rejecting these two extremes,
but in establishing a coherent intermediate position which is theoretically
rigorous and supported by the empirical experience of recent years.
Our central theme – the relationship between power and ideas – is not new to
the social sciences; it has been debated since humankind started to reflect on the
world and our place in it. But this book has been concerned with the power of
ideas in a very particular setting, namely the system of multilateral development
institutions. Such a system, and the institutions which constitute it, must be
anchored in some sort of perception about what kind of collective good one
Ideas and institutions: who is framing what? 207
would like to achieve, and more broadly in a ‘shared’ set of ideas. An important
question is, therefore, how shared sets of ideas come into being, and change over
time.
We believe that ideas cannot be separated completely from their context or
relationship to various political interests. Even when a potentially challenging
idea is introduced, its power can be weakened, destroyed or redirected to other
purposes than those originally intended. Here, we clearly see the relevance and
the wisdom of the quotation at the head of this chapter, because the question is
not necessarily ‘whether one can make words (ideas) mean so many things’, but
rather, ‘which is to be master’. The role of ideas cannot be separated or analysed
in isolation from considerations about the power relations of the social system
that we wish to study.
The social system that this book explores is a new and different arena for the
literature on the role of ideas, and we hope that by focusing on this particular
social system we may not only enhance our understanding of development
policy, but also make some contribution to theory in general.
Realism, constructivism and neogramscianism

The aim of this volume is thus not only to study a matrix of ideas and institu-
tions, and thereby learn more about the multilateral system in general, but also
to be innovative in theoretical terms. We did not wish to impose a predetermined
theoretical apparatus, but rather allowed the empirical data to guide the
methodology – adopting an eclectic approach which benefits from insights from
several disciplines. However, it is apparent that the authors of the various chap-
ters in this book share considerable common ground, and we therefore feel some
confidence in formulating a common framework for the relationship between
power and ideas in multilateral institutions, and drawing some general conclu-
sions. Our theoretical approach may be briefly summarized.
It is widely acknowledged that the most important implication of political
realism for the study of politics is that outcomes cannot be studied in disregard
of the distribution of power. A political realist will understand the institutional-
ization of the multilateral system as resting upon specific forms of power
relations. Nevertheless, very few realist scholars think that ideas do not matter,
and likewise few constructivists maintain that political activity is solely about
ideas and identities. The question is rather the relationship between power and
ideas in specific circumstances. Ideas give material power direction and cause by
defining priorities, whereas material capabilities may cause actors to change their
ideas and priorities by affecting their ability to control their external and internal
affairs (see Wohlforth 2000).1
We argue that power relations in the multilateral system are used to promote
some ideas and some specific interpretations of ideas over other possible ideas
and interpretations of ideas. There are two related, but different kinds of power
involved in all types of social interaction. One is relational, the other is structural.
Conceptually they are different, but an actor can exercise both simultaneously,
and the use of them is dependent upon both material and ideational factors
(Strange 1997). Relational power – as the power of A to get B to do something
they would not otherwise do – does not have to be legitimate in any sense. Its use,
however, is still dependent upon the interplay of material conditions, interests and
ideas; for without ideas there will be no interests, and the wielding of relational
power is built upon interests. Similarly, without interests there are no meaningful
material conditions upon which to enforce one’s relational power. And, finally,
without the material conditions there is no framework of reality in which to act at
all. Structural power is power over the ‘order of things’ and the beliefs sustaining
the ‘order of things’. The structural power of the institutions within the multilat-
eral system is legitimate to the extent that states, firms, NGOs and people accept
it. This way of reasoning suggests that it may be possible to form a bridge
between material and ideational explanations.
To continue further we need to draw on the constructivist perspective. This
perspective implies that the structures of the multilateral system are determined
by shared ideas to a larger degree than by material conditions, and, equally
important, that the identities and interests of the actors within this system are
constructed by social interaction around competing interpretations of different
ideas. However, the relationship between ideas and power in the multilateral
system is not only a question of shared ideas, but equally of opposed and
contested ideas; we must still come to grips with the realities of power. Any
framework for understanding the relationship between power and ideas in the
multilateral system must also take seriously the basic premise of political realism:
outcomes cannot be properly analysed in disregard of the distribution of power.
Equally important, since we here are talking about ideas as collective images, we
need to establish a clear connection between ideas and institutionalization. This
bridge we find in the neogramscian approach and Gramsci’s understanding of
hegemony as a structure of dominance.2 Here, the question of whether the domi-
nant power is a state, a group of states or some other combination of public and
private power is left open. What is of greater importance to this interpretation is
that the position of hegemonic power is sustained not merely by force, but by
broadly based consent through the acceptance of an ideology and of institutions
consistent with this structure. In other words, a hegemonic structure of world
order is one in which power primarily takes a consensual form. We reserve the
term hegemony for a consensual order, whereas dominance refers to a prepon-
derance of material power.
In such a consensual order, institutions and an institutionalized multilateral
system play an important role because they provide ways of dealing with conflict
so as to minimize the use of force. There is, of course, enforcement potential in
the power relations that underlie any social structure, in the sense that the strong
can discipline the weak if they think it is necessary to protect their interests.
However, also more nuanced mechanisms can be used for that purpose. The
strong may make concessions that will secure the acquiescence of the weak in
their leadership. One way of achieving this is for the strong to express their lead-
ership in terms of a constructed ‘global good’, rather than overtly serving their
own particular interests. It is precisely here that the institutions in the multilateral
system may become the locus for such a hegemonic strategy, because through
the ideas and policies they embody they lend themselves both to the representa-
tion of diverse interests and to the universalization of those ideas and policies.
The current struggle over the hegemonic interpretation of governance is but one
example of such processes.
In short, our argument is that a neogramscian perspective has much to offer
for an understanding of the relationship between power and ideas in multilateral
institutions, not least because of its emphasis on the consensual aspect of hege-
mony. However, for a framework that seeks to interpret the relationship between
power and ideas in multilateral institutions, it is but one part of the larger equa-
tion. If we accept the central premise that both ideas (shared and contested) and
the distribution of power (ideational and material) matter, then we need in addi-
tion to study the interplay between actors and structures in the various power
games that take place in relation to these material and ideational struggles in
multilateral institutions.
One possible approach to this issue is to apply elements of structuration
theory, which opens the way for conceptualizing agents (actors) and structures as
mutually constituted or co-determined entities (Giddens 1979; 1984). Social
agents are seen as reflexive and able to gather and accumulate knowledge. They
have an advanced view of the world, and they are able to evaluate their actions
in light of their knowledge and experience. Social agents are therefore constantly
performing actions – often intentionally, but also sometimes unintentionally –
which ensure that social structures are reproduced. ‘Structure’, in this sense, is
rules and resources, recursively implicated in the reproduction of social systems.
Structures exist as memory traces, the organic basis of human knowledge, and as
instantiated in action. ‘A structure constitutes a structure only because of the
behaviour of the agent, which in turn is intimately bound up with knowledge of
the structure’ (Buzan et al. 1993: 107).
Within multilateral institutions there are complex sets of social structures,
sometimes unobservable, that shape the behaviour of the various agents (state
and non-state) involved in the power games that take place in these institutions
concerning the use of ideas. Such structural constraints are observed, not neces-
sarily because of the sanctions imposed on deviants, but because of the reflexive
capacity of the agents concerned to see what would happen in a context of
interaction where such structures did not exist. Structural constraints are effec-
tive only as long as they are reproduced by the action of agents. The
circumstances of social constraint where individuals have few or no alternative
paths of action should not be equated with the dissolution of action as such,
because social constraints do not operate like forces of nature. To have no choice
is not quite the same as being driven irresistibly and uncomprehendingly by
mechanical forces. Rather, within all social systems (multilateral institutions
included) power creates regularized relations of autonomy and dependence
between agents in contexts of social interaction. Nonetheless, in all dependent
relationships, and especially hegemonic relationships, those who are subordinate
can influence the activities of their superiors. Power will always be expressed in
the duality of structure, where resources are structured properties of social
systems, drawn upon and reproduced by knowledgeable agents during the course
of social interaction.3
The multilateral system: a diversity of institutions

In order to understand the relationship between power and ideas in multilateral
institutions, we must recognize that the multilateral system is composed of many
different institutions, established for various purposes at different points in time.
The articles of agreement of the IMF and of the World Bank were drafted and
signed by representatives of forty-four nations at Bretton Woods, in July 1944.
The major regional development banks were established in the period between
the late 1950s and the mid-1960s.4 The UNDP was created in 1965 through the
merger of two already established development agencies, and the WTO was
established on 1 January 1995 as a result of the decisions taken by the
contracting parties to the GATT at the conclusion of the Uruguay Round.
We must also recognize that there have been substantial changes in their
problem definitions. For instance, let us consider the World Bank. After the
Second World War, the main task of the World Bank and the other Bretton
Woods institutions was to contribute to the reconstruction of Western Europe
(and thereby to prevent these societies from falling into the sphere of influence
of the Soviet Union). Some years later, the problem definition of these institu-
tions had been completely redefined to creating industrial growth in what were
termed, after the process of decolonialization, developing countries. In the
1970s, another change took place, and the main goal was no longer supposed to
be industrialization in itself, but poverty alleviation, and in its footsteps followed
an emphasis on employment, the basic needs approach (and the related concept
of the informal sector). The 1980s were marked by the increasing influence of
the World Bank and other Bretton Woods institutions (Emmerij et al. 2001). The
approaches of these institutions were substantially redefined in accordance with
the emergence of neoliberalism as the dominant economic paradigm. One
important, though unintended, outcome was the increased importance of
NGOs within the international development debate. The consequence was
renewed criticism of the development approaches of multilateral institutions,
and a search for new solutions to development, which both made these institu-
tions more aware of issue-areas like sustainable development, governance and
social capital, and diminished their ability to stick to their formula of political
neutrality (Bøås and McNeill 2003). As several of the chapters of this volume
have shown, the limits to the technocratic consensus preferred by multilateral
institutions became more and more evident towards the end of the previous
millennium.
The institutions that make up what is known as the multilateral system do not
only vary in terms of age, but also with respect to what kind of functions they
are supposed to perform (development, finance, trade, etc.), geographical area,
location of headquarters, membership structure (global or regional) and organi-

zation of their ownership. Some are organized as MDBs (e.g. the World Bank
and the regional development banks) with a specific type of ownership structure
in which votes are allocated on the basis of paid-in and guaranteed capital. In
the IMF also, votes are allocated on the basis of financial contribution, but here
the sum contributed by each member country also serves as the basis for deter-
mining how much the contributing member can borrow from the IMF or receive
from the IMF in period allocations of special assets known as Special Drawing
Rights (SDRs). The WTO as the successor to the GATT provides the legal and
institutional foundation of the global trading system. Thus, as an institution, the
WTO has three main dimensions:
(i) the legal and institutional foundation of the world trading system;
(ii) a forum for multilateral trade negotiations;
(iii) a centre for the settlement of disputes.
The UNDP as a UN agency, on the other hand, operates, in principle, on the

basis of one-country one-vote, but de facto its operating procedures are not that
different from those we find in the MDBs. The Executive Board of UNDP is
elected by the Economic and Social Council of the UN (one-country, one-vote).
In the Board, although consensus is the norm, it is hard to imagine that the
consensus that emerges from discussion is unrelated to each Board member’s
financial contribution both to the UN at large and UNDP in particular (i.e.
power on the basis of contribution).
Thus there is wide variation between institutions not only with respect to their
governance (for instance, the extent to which they are formally controlled by the
donor or recipient countries) but also the extent to which they have power and
resources. There is also variation in the degree to which they promote neoliberal
views, and are dominated by economics – as discussed below. Thus, as summa-
rized in Table 15.1, one might compare the various multilateral institutions in
terms of these four factors:5
• the level of direct control by donor countries/the G-7 countries;

• the extent of their power;6
• the extent to which they promote neoliberal views;
• the extent to which their activities are dominated by the discipline of
economics.
These factors are inter-related – some almost by definition. For example, in

order to promote neoliberal views it is necessary that an institution adopts an
economic perspective (although the latter does not necessarily imply the former).
Donor control tends to be positively linked with resources available. Referring to
Table 15.1, we should also note that the combination ‘high’ for ‘neoliberal’ and
‘economics’ tends to be positively correlated with ‘high’ on the other two factors
(‘control’ and ‘resources’).
Table 15.1 Classification of multilateral institutions
Donor control Power Neoliberal Economics
WTO High High High High

IMF High High High High
World Bank High High High–medium High
UNDP Low Low Medium–low Medium–low
ILO Low Low Low Medium–low
UNFPA Low Low Low Low
The summary table gives some support to our general hypothesis. Our
interest is especially in what might be called ‘the economic–technocratic nexus’.
All multilateral institutions are, of necessity, technocratic. In order for ideas to be
used in such organizations they must be translated into terms which can be oper-
ationalized. This, we suggest, (together with the importance of achieving
consensus), tends to involve a process of ‘depoliticization’, and a tendency for
economics to become the dominant discipline. In short, we suggest that ideas
that challenge the conventional wisdom become distorted as a result of a series
of related pressures; depoliticization and ‘economization’, which may be, but are
not necessarily, linked to neoliberal ideology and the material interests of those
countries with most power in the system.
A strong claim is thus that the most powerful multilateral institutions, in terms
of the resources at their command, are controlled by the donor countries (and
most particularly the USA), promote neoliberal ideas, and are dominated by an
economic perspective. Any challenging ideas that arise, if not directly refuted,
are distorted, in keeping with this worldview (and world interest). A weak claim is
that multilateral institutions are necessarily consensual and technocratic; and
that new ideas are diluted and distorted in the process of gaining broad accep-
tance for them, and putting them into operation. The contributors to this
volume occupy varying positions along this range. To present and support our
own position, we need first to elaborate further on key components of the argu-
ment: the role of USA, and the meaning of neoliberalism; the place of
economics and its relationship to a technocratic approach.
The United States – even though its powers vary from one institutional
context to another (e.g. the World Bank vs. the ADB) – is, without doubt the
hegemonic power within this system. It might be argued, with respect to the role
of the United States, that multilateralism under the control of a hegemonic
power is not much different from disguised bilateralism (see Ascher 1992).
However, this would in our view represent a huge simplification of the complex
power structures and relationships that multilateral institutions represent. And
none of the contributions to this volume suggest such an approach. What does
seem to be the case is that strong member countries (and even NGOs with the
right kind of connections) can sometimes use multilateral institutions to send

messages that it would have been awkward to send through bilateral channels.
The consensus produced by multilateral institutions around controversial ideas
such as governance can be a sophisticated way of making a particular viewpoint
less offensive and more generally accepted. This is clearly what has happened at
some point in time to many of the ideas discussed in this volume.7
We need to identify more clearly what we mean by neoliberalism. Every
society has a set of rules, which governs access to resources, and one can argue
that the contemporary world political economy operates on an allocation system
based on neoliberal ideas. In the 1980s, most multilateral institutions were
strongly influenced by the economic ideas advocated by world leaders such as
Ronald Reagan and Margaret Thatcher. This advocacy, in combination with the
breakdown of the communist bloc, led to the universalization of a particular
view of development by some of the most powerful multilateral institutions
(especially the IMF and the World Bank). The basic wisdom became that the
market, rather than the state, should be the main vehicle for development. The
post-war era of embedded liberalism was therefore seen as a thing of the past,8 and
in its place came the so-called Washington Consensus.9
It is no coincidence that this term refers to the capital of the USA. To think
that it does not matter where a multilateral institution is located is to us naive.
The institutions that we have dealt with in this volume are international institu-
tions, but they are clearly also embedded in local, national and regional power
structures and contexts. As Janne Jokinen’s contribution indicates, it is of vital
importance that the ADB’s headquarters are located within its region and not
elsewhere. Similarly, it is for us quite clear that the fact that the World Bank and
IMF are located in Washington DC, only a few blocks from the White House
and the US Treasury, gives the Treasury many subtle ways to control and influ-
ence these institutions that other important member countries do not have.
US support for the World Bank has been guided by the view that promoting
economic growth and acceptance of market liberalism in other parts of the
world is in the national interest, and that multilateral institutions are an effective
way of achieving these objectives (Gwin 1994). The latter is the case precisely
due to the potential connection between ideas, international norms and domestic
change. If the US through multilateral institutions can persuade powerful
segments of national elites to embrace these objectives, it can achieve its foreign
economic policy objectives more effectively and at less cost than through bilat-
eral negotiation or coercion. Thus the United States would like multilateral
institutions such as the World Bank to push as hard as possible for market
reforms in borrowing countries (as a condition for aid) and to ensure that the
appointment procedure to these institutions yields people who support and
actively promote this objective. However, for such a strategy to be effective it is of
crucial importance that multilateral institutions appear to be acting in accor-
dance with a common collective good agreed upon in general by all member
states, rather than by US Treasury diktat. If not, the legitimizing benefit of a
multilateral strategy may easily be lost (Wade 2002).
It is here that the issue of knowledge and the political neutrality of a certain
type of economics enters the frame, because the World Bank’s ‘legitimacy rests
on the claim that its development advice reflects the best possible technical
research, a justification readily cited by borrowing governments when imposing
Bank policies on their unwilling populations’ (Wade 2001b: 128). The produc-
tion of knowledge in multilateral institutions is therefore produced within a
frame of reference that embeds certain cognitive interests, meaning that knowl-
edge becomes an instrument, a tool, for the identification of manipulative
variables (Nustad and Sending 2000).
There is clearly an enforcement potential in the power relations that lie under
the social structure of multilateral institutions, but most often this enforcement
potential takes the form of more nuanced mechanisms than simply an open
disciplining of the weak by the strong. Even though nearly all the contributions
to this volume in one way or another point towards the strong role played by the
United States in multilateral institutions and the importance of understanding
the hegemonic position of neoliberalism in the policy debates in multilateral
institutions, we find little evidence for a conspiracy approach to the ‘who is
framing what?’ question. Neoliberalism as the current dominant economic
paradigm certainly is important with respect to how the debates around specific
ideas are framed in multilateral institutions. To that extent, we agree with
Taylor’s contribution. The main contention of his chapter is precisely that ideas
centred on notions of ‘good governance’ have been promoted by the IMF as
part and parcel of the neoliberal order and are attempts to reconfigurate territo-
ries in order to make them more attractive to international capital.10 The United
States through the US Treasury is the most important player in most of the
multilateral institutions that we have dealt with in this volume, but to suggest that
the power of a specific idea or interpretation of an idea is simply a matter of
whether or not it is supported by the US is by far too simple an explanation. As
is apparent both from Taylor’s contribution and others in this volume, neoliber-
alism seems to have become some sort of common sense during the two most
recent decades. Theories opposed to the wisdom of neoliberalism have often
been treated during this period ‘with the bemused condescension usually
reserved for astrological charts and flat-earth manifestos’ (Cardoso and Helwege
1992: 8). This implies that the role of neoliberalism as the dominant economic
paradigm in most multilateral institutions should be approached as what Pierre
Bourdieu (1977: 164) entitles doxas:
[S]chemes of thought and perception can produce the objectivity that they
produce only by producing misrecognition of the limits of the cognition that
they make possible, thereby founding immediate adherence in the doxic
mode, to the world of tradition experienced as a natural world and taken for
granted.
This concept of doxa can be equally applied not only to neoliberal economics,
but perhaps to economics in general. The dominant liberal approach to the
study of economics assumes that it is an objective, ‘value-free’ scientific

discourse. The laws of economics, it is argued, are universal and it is the task of
economic theory to discover these laws (Williams 1993).
Several of the chapters indicate that in order to understand the relationship
between knowledge, ideas and the power of multilateral institutions, we have to
come to terms with the role of the hegemonic position of economics in multilat-
eral institutions. In the analysis and prescriptions from these institutions,
economics is presented as an objective discipline that provides a value-free and
correct picture of the world. Presenting the problem definition in this way means
that development becomes a technical question and not a political one: an issue
concerning sustainable development or governance that appears to be a matter
of making the correct choice based on data and analysis, rather than a political
decision. Such an approach fits ‘hand in glove’ with the overall mandate of these
institutions, which is built on a functional and technical approach to develop-
ment. The only valid evaluations are those built on economics, because this is
assumed to be an objective science. Undoubtedly this understanding of
economics has contributed immensely to the dominant position of this discipline
in multilateral institutions. The consequence is ,therefore, that these institutions
in their approach to ideas such as the informal sector, governance, social capital
and sustainable development are operating ‘within an empiricist/positivist epis-
temology, whose hallmark is an ontological distinction between subject and
object which in turn produces the possibility of objective knowledge’
(Abrahamsen 2000: 13).
Clearly, structural adjustment has been imposed on a number of countries, but
when it comes to the ideas studied here, we would not claim that these have been
imposed by USA and associated neoliberal forces. They may well be modified,
and even distorted by these, but more importantly by the economic–technocratic
nexus. Material interest alone does not provide a sufficient explanation of how
and why ideas are adopted or transformed. The norms of institutions, and groups
within them, are of great importance.
The ideas discussed in this volume have been introduced to various multilat-
eral institutions over a fairly wide time-span: from the idea of development in
Truman’s inaugural speech in 1949 (see Chapter 2), to that of social capital,
which entered into World Bank discussion in 1996 (see Chapter 8). Of particular
interest is the way in which ideas travel between the institutions within the multi-
lateral system. All the ideas discussed in this volume were first adopted by one or
two institutions, and only after becoming manifest there through policy papers
and statements were they taken up by other multilateral institutions; sometimes
voluntarily, but just as often because they had come under strong pressure from
NGOs to do so. In this volume we find several examples of agenda-pushing. One
example is the story of WTO and sustainable development (see Chapter 7).
Another, rather different, case – and perhaps the clearest example in this volume
of an agenda being single-mindedly altered by the initiative of a group of like-
minded actors – is the story told in Chapter 5 concerning international
population policy.
However, when we look at the late–comers to an idea, we often find that they
have learned little from the experiences of those institutions that have been
concerned with the idea for some time. This observation becomes strikingly
apparent if we compare the experience of sustainable development in the World
Bank and the WTO (see Chapters 6 and 7 respectively). Wade’s analysis is a
history several decades long that takes us through three paradigmatic shifts from
‘frontier economics’ (prior to 1987), ‘environmental protection’ (up to early
1990s) and ‘environmental management’ thereafter. However, as we can see
from Bøås and Vevatne’s contribution, there is very little evidence that the WTO
has learnt from the World Bank experience. Rather, it seems that the WTO,
when finally forced to confront the issue of environment and sustainable devel-
opment in 1995, adopted an approach quite similar to that of the World Bank
prior to 1987 (i.e. ‘frontier economics’). Both the internal debate in the WTO
and the external debate with its critics in the NGO community bear a striking
similarity to those in and around the World Bank over a decade before. It was
thus only rather a general notion of the idea of sustainable development that
‘travelled’, not the whole debate surrounding it. Yet in other cases communica-
tion between multilateral organizations can be rapid and effective. There is
considerable contact between different and potentially competing parties, not
only through commissions, conferences and regular meetings, but also through
staff members changing their position from one institution to another. But the
extent of this varies considerably. For instance, there seems to be much more
movement of people between the World Bank and the regional development
banks than between UN agencies and institutions like the IMF and the WTO.
The latter two seem to have had a much greater ability to insulate themselves
from on-going policy debates elsewhere in the multilateral system than the other
institutions that have been discussed in this volume. Indeed, one can speak of the
different cultures of multilateral organizations – varying even within one family
(e.g. the IBRD, the IFC and the IMF), and to a greater extent between them (e.g.
ILO and WTO). Each has its own identity, socially constructed through the
practice of specific multilateral institutions (an obvious example is the WTO
secretariat: see Chapter 7). These are also manifest in the publications of these
institutions, for example the Human Development Report, the World Development Report
and the annual reports of institutions like the ADB. These are flagship publica-
tions, presenting an image of independence and conclusions based on empirical
evidence and the best technical research available. They define the ideas the
institutions are most eager to project in the near future.
Each of the multilateral institutions has its own identity – even if it does
change over time, and is perceived differently from inside and outside. As some
of the chapters have suggested, those working within these organizations are
seeking to fulfil perhaps conflicting roles – in keeping with the identities of the
organization for which they work and their own sense of professional purpose.
And multilateral institutions are not static institutions; they do change, and so do
the collective identities which they embody; and ideas play an important role in
these processes of change.
However, for an idea to be of importance to a multilateral institution in the first

place, that idea cannot represent total opposition to the hegemonic knowledge-
system and the collective identity formed around this knowledge-system. In fact, an
important insight to be gained from this volume is that for an idea to make an
impact in a multilateral institution it must be possible to adapt or distort that idea
in accordance with the dominant knowledge-system, the collective institutional
identity formed around this knowledge system, and the power relationships in the
world political economy that maintain them.
If we then accept one of the central assumptions behind this book, namely
that the power of ideas is tied up with the institutionalization of social action
and the material capabilities that such kind of institutionalization is built upon,
the question still remains: what is the nature of this relationship? To what extent
do ideas change institutions; or do institutions change ideas?
Power and ideas in multilateral institutions: an

interpretative framework
Our suggestion is that the economic, technocratic (and in some cases also neolib-
eral) nexus provides a two-way link between the ideas and institutions studied in
this volume. The idea of poverty (see Chapters 12 and 13) is an example of both
the interplay between ideas and institutions, and the dynamic component of these
processes. From the late 1980s, a more political (or at least ethical) concept of
poverty favoured by the UNDP counterposed a more economic, technocratic
concept favoured by the World Bank. The UNDP (or perhaps more accurately, the
Human Development Report) initially sought actively to be distinct from the established
position, associated with the World Bank; but over the subsequent years the World
Bank and UNDP seem to have moved closer to a common position. What forces
lie behind such processes? How – more broadly – can one explain the interplay
between ideas and institutions in the making of multilateral development policy?
In seeking answers to these questions, we have found inspiration in a neograms-
cian approach, for two main reasons. First, it provides an ontological and
epistemological foundation for the construction of non-deterministic yet structurally
grounded interpretations of social change. With its emphasis on the transformative
capacity of human agents it offers a path between the pre-determined units of
neorealism (i.e. states) and the unexplored domestic foundations of world-systems
theory. We see the relevance of such an approach in almost all chapters in this book,
for instance in Jokinen’s analysis of the ADB’s policy on good governance and
Sindzingre’s account of the idea of poverty in the World Bank. In particular, we see
this in Jokinen’s embedding of the ADB’s governance debate within the context of
the larger exchange that took place between the proponents of the Washington
Consensus, represented by the United States, the World Bank and the IMF, and the
East and Southeast Asian supporters of its challenger, the Developmental State
model; and in Sindzingre’s examination of the various dimensions of the trajectory
of poverty in the World Bank, which she links with an on-going production of a
political economy of knowledge.
Second, the approach provides a flexible and ultimately historicist reading

of institutions and the power of ideas; in particular, it offers us insight into the
basis for hegemony, its construction as a social artefact and its inherent
moments of contradiction. By viewing hegemony in itself as a product of lead-
ership, we can more easily see both its contestability and the impossibility of
reducing it to a preponderance of material resources. It is, for instance,
obvious that the position of the United States within a multilateral institution
like the World Bank is not built solely on its financial contribution to this insti-
tution; equally important is the way in which American premises structure the
very mindset of World Bank staff, management and Executive Directors’
offices (see Wade 2001b).
What we find more problematic is the neogramscian claim that at the apex of
an emerging global class structure sits a transnational managerial class. We do
not necessarily reject the existence of a kind of transnational managerial class.
The international bureaucracies of multilateral institutions share several traits,
whether we are talking about the international bureaucrats of the World Bank,
the ADB or the UNDP. However, as is evident from the case studies presented
here, there is also much that separates these institutions and thereby also the staff
within them. Socialization is clearly an important aspect of multilateral institu-
tions, but again, as the case studies have shown, the processes of socialization in
multilateral institutions are diverse. This is evident in the chapters in this book
that deal with the World Bank and the ADB respectively (see the contributions
from Jokinen, McNeill, Sindzingre and Wade).
A second problem with the neogramscian approach is that hegemony appears
to be total. There is no way to measure the strength of its power, or to assess
countervailing tendencies. It gives us an inadequate understanding of the nature
of agency in policy making and agenda setting (see Germain and Kenny 1998).
One example is the assumed dominance of the neoliberal paradigm. Some
neogramscian approaches see the hegemonic position of this paradigm as the
product of a transnational managerial elite who are at the forefront of globaliza-
tion trends worldwide, and who have established a convincing set of intellectual
arguments to underpin their fortunate material position within a global political
economy (e.g. Gill 1990a; Pijl 1998). By doing so, neogramscians perhaps unwill-
ingly come to understand hegemony as a one-directional power relationship; it is
fashioned by this transnational elite class on its own terms and then forced or
imposed on subaltern classes/masses/states. The consequence, as we see it, is
that the actual discursive battles that take place over ideas, both as intersubjec-
tive meanings and as collective images, vanish from the analysis. Everything can
be explained by reference to the hegemonic position of neoliberalism and the
dominant position of the transnational managerial class. This tends to make
neogramscian analyses less relevant than they potentially could have been, both
in empirical and theoretical terms.11
Nevertheless, and in the light of the various contributions to this volume, we
feel that we need the neogramscian perspective because it draws our attention to
some very important matters, (among them the consensual aspect of hegemony).
However, for a framework that seeks to interpret the role of ideas in multilateral
institutions, it must be combined with perspectives that enable us to design more
precisely defined actor-oriented studies.
This point takes us back to the issue of the relationship between realism,
constructivism and neogramscianism raised in our introduction to this collec-
tion. Our major point in this regard is that in all social systems (multilateral
institutions included) power creates regularized relations of autonomy and
dependence between agents in contexts of social interaction. However, those
who are subordinate can still influence the activities of their superiors. It is here
that we see the need to revisit the arguments made by James Hentz in Chapter
14. Here Hentz draws our attention to several theoretical points of importance.
First, by utilizing Escobar (1995b) and Ferguson (1990) he draws our attention
to how ideas are marketed as technical solutions to developmental problems.
Constructivism, with its emphasis on the social construction of politics, can help
us understand the construction of political issues as technical solutions (i.e. the
economic–technocratic nexus), whereas realism helps us to expose the political
interests and power relationships that underwrite such constructions. The basic
point, as Hentz argues, is that while the constructivist critique is essential for
understanding the role of ideas, it lacks a clear appreciation of power. Realism
can therefore complement the ideational focus of constructivism. The impor-
tance of understanding the ‘lock-in’ process is evident in several of the
contributions to this volume, but perhaps most strikingly in Taylor’s analysis of
IMF and ‘good governance’: the political implications of locking into the liber-
alization process as legitimate reforms aimed at normalizing the national
political economy. He interrogates the idea of good governance as promoted by
the IMF as a value-free and correct picture of the world. In this argument, the
three main theoretical propositions highlighted in the introduction come to the
forefront and speak to each other: constructivism helps us understand the
process of social construction of governance; realism exposes the power rela-
tions not only beneath this process of social construction, but also how this
interpretation of governance becomes locked in at the country level; and
neogramscianism elucidates the larger macrosocio-economic environment in
which these processes take place.
In summary, we favour an intermediate, and somewhat eclectic approach,
which may be contrasted with two others:
Alternative 1 is an extreme version of the constructivist/ideational model: the

policies of multilateral institutions are determined by ideas derived from shared
norms – of rational behaviour and the common good; institutions embody these
norms and adopt policies consistent with them.
Alternative 2 is an extreme version of the realist/material model: the policies of

multilateral institutions are determined by the material interests of those that
control them; ideas – to the extent that they play a part – are also a reflection of
these same material interests.
Alternative 3 is the more complex, mixed approach which we favour. Policies are
the outcome of interplay between institutions and ideas; and each of these is
influenced both by material interests and norms.
This implies that one must take account of several different interconnections –
between interests and norms on the one hand, and institutions and ideas on the
other. In brief:
Link 1 Material interests shape the nature and behaviour of institutions:

different ownership structures (by states) have a major impact on the outcome.
Link 2 Material interests shape ideas: what is agreed – indeed even what is
thought – is strongly influenced by the interests of powerful actors.
Link 3 Norms shape institutions: concepts of the common good and consensus,
as well as bureaucratic rationality, objectivity, neutrality, strongly influence how
institutions are organized and operate.
Link 4 Norms shape ideas: both bureaucratic norms (as above) and also
academic norms (rigour, complexity – perhaps also originality) influence what
ideas emerge and what form they take.
These, then, underpin the relationship with which we are primarily concerned in
this book – between ideas and institutions. To the question: ‘Who frames what in
the making of policy?’, we give no simple answer. It is apparent that ideas can
indeed bring about change in an institution’s policy, but also that institutions
modify and distort ideas.
Central to our argument is the concept of framing – and more broadly the
exercise of hegemonic power. We suggest that powerful states (notably the USA),
powerful organizations (such as the IMF) and even, perhaps, powerful disciplines
(economics) exercise their power largely by ‘framing’: which serves to limit the
power of potentially radical ideas to achieve change. The exercise of framing is
composed of two parts: one, drawing attention to a specific issue (such as the
environment or urban unemployment); two, determining how such an issue is
viewed. A successful framing exercise will both cause an issue to be seen by those
who matter, and ensure that they see it in a specific way. And this is achieved
with the minimum of conflict or pressure. For the ideas appear to be ‘natural’
and ‘common sense’.
Our argument is that neogramscian approaches offer some potential in
helping us to deconstruct such doxas and thereby give them their proper place
within the wider political economy. In this book this is explicitly argued in rela-
tion to governance and structural adjustment in Taylor’s contribution (see
Chapter 9). As George and Sabelli (1994: 150) put it: ‘Being against good gover-
nance is rather like being against motherhood and apple-pie’. An effective
‘frame’ is one which makes favoured ideas seem like common sense, and
unfavoured ideas appear unthinkable. We suggest that a similar argument can be

applied also to the other ideas, because as Cox (1992a: 179) argues, ‘hegemony
frames thought and thereby circumscribes action’.
Readers may be critical of our eclecticism and pragmatism towards issues
deeply entrenched in decades of epistemological and ontological debate within
international relations theory and international political economy literature. We
would, however, claim that even within political realism there is no single tradi-
tion, ‘but rather a knot of historically constituted tensions and contradictions’
(Walker 1987: 80). This implies that the tradition of political realism is in itself a
social construction, and although constructivism constitutes a challenge to posi-
tivist ontology and rational choice theory, there is more to realism than just these
two tenets. As vividly described by Hentz, both in classical realism and in post-
classical realism we can identify several ‘meeting spaces’ between these two
broad strands of theory. Supported by the findings from the case studies, we
choose to leave the metatheoretical battlefield, preferring to study how processes
of policy making are actually carried out, and move into the terra incognita
between the three positions highlighted here. This is for us the only way to make
progress in understanding the complexities of the role of ideas in multilateral
institutions.
Conclusion
In earlier days, a simplistic model of the development arena had capitalism
pitted against communism: the US on one side and the USSR on the other.
More recently the dividing lines have changed: first ‘state versus market’, and
more recently, perhaps, ‘globalization versus local civil society’. Some would
claim that the conflict is – and has always been – between right and left, and that
this is manifest both in relation to multilateral institutions (the extent to which
they are dominated by the US) and in relation to ideas (the extent to which
neoliberal ideas are dominant). We would support only a much modified version
of this argument. Clearly, a policy such as structural adjustment can be seen as
favouring the material interests of the US; and it can plausibly be argued that it
has been promoted by some (e.g. the IMF) and opposed by others (e.g. UNDP).
But such an argument can hardly be applied to all the ideas discussed here. With
the exception of governance, most of the ideas can only to a limited extent be
directly linked to a neoliberal agenda. Rather, one can postulate a continuum of
ideas, according to the extent to which they can be mapped onto a ‘right–left’
axis. Governance would be at one end; poverty, the informal sector and perhaps
sustainable development in the middle; and social capital and reproductive
health at the other.
We suggest that political interests such as those represented by the US
Treasury do indeed exercise considerable influence, but there are two major
limitations with this account. One is, as just noted, that with regard to most of
the ideas that we have discussed, there is not one clear neoliberal position as
such. The second point is that when ideas are contested, at least in the arena of
multilateral institutions, neoliberal and other forces do not generally exercise

their power over ideas directly – by simply rejecting those that they oppose or
enforcing those that they favour. The power of new ideas to change the policy of
multilateral institutions is typically limited not by direct opposition from such
forces, but by a more complex process in which ideas are distorted. The debate
in multilateral institutions is, we argue, ‘framed’; that is to say that it is
constrained in certain ways, which are largely implicit and even unintentional.
And this is the result not only of the forces of neoliberalism but to a much more
substantial degree what we have identified as the ‘economic–technocratic’ nexus.
To illustrate, let us briefly contrast the ‘ideas’ of governance, on the one hand,
and sustainable development and social capital on the other. In the case of
governance, neoliberal interests are directly associated with the emergence of the
idea in multilateral institutions; but this is not so for the other two. In all three
cases, a new issue was successfully placed on the agenda, and the way in which it
was discussed was strongly determined. (For example, not only did the environ-
ment become central for most multilateral institutions; the concept of
‘sustainability’ became central to the way in which people thought about it.)
These were thus most effective framing exercises. The ideas have been diluted
and distorted in various ways; but it is evidence of their potency that they have
seldom been rejected outright. One could claim that in the case of governance,
material interests were of significant importance, but what emerges from the
case studies is that the distortions that have occurred – also in the case of gover-
nance – have been predominantly technocratic/economic.
There are thus two distinct, but partly related, forces at work: one is neolib-
eral ideology, the other what we call the economic–technocratic nexus. Whether
and to what extent a specific idea is distorted as a result of the former depends
on the type of idea; but all, we suggest, are subject to the latter. What is common
to both is depoliticization: ideas are drained of any overt political content, even
if they are not wholly drained of their power. This perhaps helps to explain the
frustration of those who seek to oppose multilateral institutions and the policies
they explicitly stand for; and why opposition to these institutions is increasingly
taking an anarchistic form.
In seeking to understand the political forces underlying the processes under
study, we have found inspiration in the works of Cox and others, in what may be
broadly described as a neogramscian approach. But, as we have also come to
discover, this approach has its limitations, because the final policy outcome seems
more to be the resolution of competing forces, none of which is completely
dominant, than a well–defined and clearly intentional strategy on the part of one
or a few dominant actors and interests. We therefore found it necessary to take
account of the institutionalization of social action, and the material capabilities
that such institutionalization is built upon. Our argument was that in order to
understand the nature of this relationship we had to draw not only on neogram-
scianism, but also on a combination of constructivism and realism. This
necessarily follows from one of the central premises of this book, that both ideas
(shared and contested) and the distribution of power (ideational and material)
matter. The triangular relationship between constructivism, realism and

neogramscianism is clearly problematic both in epistemological and ontological
terms, but the findings from the case studies all seem to indicate that answers to
the generic question – to what extent do ideas change institutions or do institu-
tions change ideas – can be obtained from pragmatic and eclectic approaches to
this triangular relationship. We therefore choose to end on the optimistic note
that both we and other researchers (perhaps inspired by this collection) will be
able to build on the initial research that this volume represents, and penetrate
deeper into this problematique in forthcoming publications.
Notes
1 Or in the words of Wendt (1999: 96–97):
The proposition that the nature of international politics is shaped by power rela-
tions invariably is listed as one of the defining characteristics of Realism. This
cannot be a uniquely Realist claim, however, since then every student of interna-
tional politics would be a Realist. Neoliberals think power is important, Marxists
think power is important; postmodernists even think it is everywhere. … Better
instead to differentiate theories according to how power is constituted.
2 Gramsci’s main application of the concept of hegemony was to relations among

social classes, and in Gramsci’s work the term is mainly related to debates in the inter-
national communist movement over revolutionary strategies. The basic logic of the
concept is, however, closely related to Gramsci’s interpretation of Machiavelli’s ideas
to his own time. For Gramsci, as for Machiavelli, and also for most of those in the
contemporary debate that have put the concept to use once more (such as Robert
Cox, Timothy Sinclair, Stephen Gill and Craig Murphy), the general question
involved in hegemony is the nature of power (i.e. power springing out of a combina-
tion of force and consent).
3 This understanding of power is in accordance with Lukes’ (1974) three-dimensional
view of power.
4 The only exception is the European Bank for Reconstruction and Development
(EBRD), which was established in 1990 as part of the transition package for Eastern
Europe after the end of the Cold War.
5 In each case the assessments are relative, e.g. the extent of donor control in UNDP is
low by comparison with IMF, but it is still considerable.
6 Power is largely, but not solely, a matter of financial resources.
7 See also Casaburi et al. (2000: 496), who argue that ‘despite the complexities, these
multilateral institutions have wholeheartedly incorporated the concept of governance
into their thinking and even into their lending programs. Good governance has
become desirable in and of itself, for the benefits of the subjects that are governed’.
For a discussion of various multilateral approaches to good governance, see Weiss
(2000). For inquries into the broadening of the governance agenda see Nelson 2000;
Santiso 2001.
8 By ‘embedded liberalism’ is meant a practice wherein states worked towards reducing
trade barriers, but simultaneously recognized the importance of state intervention in
national markets. See Ruggie (1982). Ruggie’s analysis draws on Polanyi (1944), which
introduced the terms ‘embedded’ and ‘disembedded’ economic orders, referring to
situations where the economy is merely a function of the social in which it is
contained, and situations where a separate economic system emerges with an idea of
a distinctive economic motive. In the latter case, economic relations are taken to be
autonomous and responsive only to their own endogenous laws of motion (Ruggie
1983). For an excellent review of Ruggie’s work, both with respect to embedded liber-
alism and in general, see Wæver (1997).
9 The term ‘Washington Consensus’ was coined by Williamson (1993) and refers to the
neoliberal economic thinking which shaped development policy in the 1980s and
1990s. Paul Krugman (1995: 28) later elaborated on Williamson’s concept in the
following manner:
By ‘Washington’ Williamson meant not only the US government, but also all
those institutions and networks of opinion leaders centred in the world’s de facto
capital – the IMF, World Bank, think tanks, politically sophisticated investment
bankers, and worldly finance ministers, all those who meet each other in
Washington and collectively define the conventional wisdom of the moment.
To some observers the Washington Consensus is as strong as ever – see Thomas

(2000: 51) who argues that: ‘As we enter the twenty-first century, the dominant
approach to development and therefore to promoting human security is more deeply
rooted in neoliberal values than ever before’ – whereas other scholars have argued
that we are in the process of entering the era of the post-Washington Consensus: see
Braathen (2000). In his analysis based on a discursive approach to the World
Development Report 2000/1: Attacking Poverty, Braathen argues that the World Bank
seems to be moving in the direction of a new type of social corporatism: it tries to
counter-balance the mechanisms of social exclusion inherent in modernizing and
industrializing societies, and hence construct collective arrangements that include
individuals in a caring community.
10 See also Stiglitz (2002: 196), who argues ‘market fundamentalists dominate the IMF:
they believe that markets by and large work well and that governments by and large
work badly’.
11 To a certain degree, several neogramscians seem to have forgotten one of Gramsci’s
central messages, namely that dominant and subaltern classes engage in a number of
material and ideational struggles which potentially change the whole socio-economic
fabric of their relationship. See Germain and Kenny (1998).
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Index
accelerated growth model 42 Doha 105

Ad Hoc Working Group on Participatory doxas 214
Development and Good Governance Dunlop. J. 64–65
162
ADB 4; as apolitical 137; Charter 149; as economic-technocratic nexus 2, 212, 222
technical 145; and sound development EFTA 96, 97
management 143–44, 146 embedded liberalism 213, 223n8
AfDB 4 EMIT 95, 102
Africa: and governance 130 Emmerij, L. 45
agent/structure model 201–02 Enhanced Structural Adjustment Facility
Appellate Body 103 131
empowerment 20
Bayart, J.F. 126 environment: and borrowing governments
Bolivia 36–38; and coca production 39; 82
and USAID 37 Environmental Defence Fund 86
Bourdieu, P. 214 Environmental Policy Institute 79–80
Boulding, K.: frontier economics 73 epistemic communities 202
Brazil 77–78, 97 Escobar, A. 28, 29, 193
Bretton Woods 15, 128, 151, 210
bridging concepts 109 family planning 56; as population policy 63
Ferguson, J. 193
Camdessus, M. 124, 132 Foucault, M. 19–20, 22
Carr, E.H. 197, 200–01 framing 1, 2, 100, 220, 222
civil society 110 Frank, A.G. 17
Committee on Trade and Environment free trade theory 96
101, 102–103 frontier economics 73, 216
consensus 24, 52, 124, 171
consensual beliefs 98, 99 Giddens, A.: structuration theory 209
constructivism 5, 194–95, 219; and realism Gill, S. 134
195; and the sociology of knowledge 32 governance 2, 8, 57, 221; as administrative
Cox, R. 5, 6, 125, 126 governance 160; as common sense 134;
as hegemonic discourse 124; ideas 134;
dependency theory 18 as neoliberal mode of regulation 151;
depoliticization 2, 4, 212 as sound development management
development 11; idea of 28; problem 143–44; and Western values 135
definition of 11, 215; word 14 Gramsci, A. 1, 5, 6; and hegemony 1, 208;
Developmental State model 138, 139, 148 and theorizing 125–27
dispute settlement mechanism 101, 103
discourse 27, 193; local 38 Habermas, J. 34, 187
252 Index
Haq, M. 74, 184–85, 190 Marrakech Declaration 97

Hart, K.: informal sector 42 McNamara, R. 46, 64, 72
hegemony 6; of economics 7; of ideas 126; modernization theory 16, 17
and international relations 125–27 Morgenthau, H. 200
maintaining 125; of neoliberal ideas multilateral institutions 3–4, 11; as
133–36 apolitical 147; culture 215; and the
historic block 124, 126 economic vs. political debate 147;
homo economicus 182 identity 102, 216; power and ideas 207;
Human Development Report 20, 184–87 problem definitions 210; socialization
218; as social structure 209; the
idea 1; biography of 41; of development 7; variations of 210–212
historical geography of 49
ideas: as categories ; as collective images 6, Narmada 85–89; and government of India
208; as common sense 124; causal 88; and NGOs 86, 88–89
power 198; diffusion of 30; evolution of National Wildlife Federation 79–80
164; and institutions 220; and interests Natural Resources Defence Council 79–80
26–27; as inter-subjective meaning 6; as neogramscianism 5, 217, 219, 220; and
material for action 197; the role of 1, hegemonic power 125–27, 218; and the
153, 194, 206–07; and power 1, 6, 194; role of ideas 125–27, 209; and
and social practice 27; as symbolic transnational class 124, 128–29, 218
technologies 27 neoliberalism 213; as approach 8; as
ILO 43; World Employment Programme common sense 214; as economic theory
43, 45 8; as ideology 2; as orthodoxy 96
IMF: and borrowing countries 130–32; neomarxism 17
original mandate 131, 136; second New International Economic Order 183
stage restructuring 131; Zaire 133; NGOs: and GATT 97–98; increased
Zimbabwe 125 importance of 76, 78–82, 86–89, 92,
informal sector 41; and Kenya 42–42; the 210
idea of 47; power of the idea of 51
Institute of Development Studies 42 Olson, M. 111
institutions 3, 6; ethos of 120; and identity Ordinary Capital Resources 137
96; and institutionalization 6, 59; organic intellectuals 135
weakness 157 organizational constraints 154–55
International Conference on Population
and Development 8, 56 passive revolution 124, 126
International Planned Parenthood Pax Americana 128
Federation 63 participation 20
international regime: and liberal trade participatory development 156, 157, 161
theory 98–99 policy stories 56, 58–59, 60–62, 63–66, 67
political viability 153
Japan 138; and ADB 140; and ODA 139 Polonoroeste 75–78, 80, 83; and NGOs 76,
Jackson Report 181 78–79; and poverty 76
postclassical realism 200
Keynes, J.M. 15 poverty: as an idea 164; genealogy of 165
Keynesian: and IMF 128; and problem-setting stories 58
neoliberalism 127 Putnam, R. 108, 111, 116
knowledge 33–35, 100, 214; and the
institution of science 57 Rawls, J. 185
knowledge-based regimes 56, 58–59, 62–63, realism 5, 196, 198–200, 207–08, 219, 221
68–69 relational power 208
relative poverty 165
Lubell, H. 43–44 reproductive health 56, 67, 69
Index 253
Resident Representative 184 UN Conference on the Human
Redistribution with Growth 42, 53, 181 Environment 73, 95
Rich, B. 80–81, 86 UNDP: and normativity 188; voting
Rockefeller Foundation: population policy system 188
61 UN Intellectual History Project 2
Rockefeller, J.D. III 61, 64 Uruguay Round 95, 98, 101
Rostow, W.W. 16 United States 16; and ADB 140; and
Bretton Woods institutions 172;
Saint-Simonians 13 14–15, 17 hegemonic power of 212; and
Sardar Sarovar 85–86, 87, 90 multilaterals 193, 218; Vietnam 128;
Science and politics 57–58 and World Bank loans 82
Seattle 31, 105, 170 USAID 170; family planning 62
Sen, A. 164, 178, 190 U.S. Congress 78–79; and IDA
Serageldin, I. 110, 111 replenishment 82, 91; and the IMF and
Shrimp-Turtle dispute 104 the World Bank 173
Sierra Club: World Bank 82 U.S. government 73; and NGOs 98
Soto, H. 48 U.S. Treasury 80, 84, 213–14, 221; and
Soviet Union 201–02 NGOs 92; and Stiglitz 172
Stiglitz, J. 110, 166, 169, 171
Structural Adjustment Facility 131 Waltz, K. 200
structural power 208 Washington Consensus 137–38, 139–40,
structure 209 143, 145, 148, 166, 213, 223n9
sustainable development 98, 100 WCED 96, 97
symbolic technologies 28 Wendt, A. 199
Taylor, L. 52–53 Wolfensohn, J. 110
Thucydides 196 World Bank 4, 19, 95; the Board 167; and
trade-environment nexus 96 European countries 170; forefront of
transnational elite 124, 129 ideas 110; and governance 110, 130,
trilateral cooperation 128 157; and the informal sector 46; leader
Truman, H, 15–16 in ideas 120; as knowledge producer
Tuna-Dolpin Dispute 96, 100 166; marketplace of ideas 120;
operationalization of policies 174; and
Udall, L. 86 recipient countries 175–76; role of 128;
underdevelopment 17, 18, 19 as technocratic 121; voting system 188
uneven development 32 World Development Report 1992 89, 92
UN: and ideas 3 World Development Report 2000/2001 109,
UN Conference on Environment and 118, 167
Development 97

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Global Institutions and Development - Framing The World

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Global Institutions and

The dearth of attention to ideas in multilateral institutions has prompted

Global Institutions and Development’s impressive scope covers a wide range

The impact that multilateral institutions have on development is hotly debated,

Morten Bøås is a Researcher at Fafo – Institute for Applied International

* also available in paperback

Edited by Morten Bøås and

Simultaneously published in the USA and Canada

Routledge is an imprint of the Taylor & Francis Group

This edition published in the Taylor & Francis e-Library, 2004.

All rights reserved. No part of this book may be reprinted or reproduced

British Library Cataloguing in Publication Data

Library of Congress Cataloging in Publication Data

ISBN 0-203-49633-7 Master e-book ISBN

ISBN 0-203-34429-4 (Adobe eReader Format)

1 Introduction: power and ideas in multilateral institutions:

2 The development discourse in the multilateral system 13

3 Contesting policy ideas from below 24

4 The informal sector: biography of an idea 41

5 Policy stories and knowledge-based regimes: the case of

6 The World Bank and the environment 72

7 Sustainable development and the World Trade Organization 95

8 Social capital and the World Bank 108

9 Hegemony, neoliberal ‘good governance’ and the International

10 Balancing between East and West: the Asian Development

11 ‘Good governance’ and the Development Assistance Committee:

12 The evolution of the concept of poverty in multilateral financial

13 The role of ideas in the United Nations Development

14 The power of ideas: across the constructivist/realist divide 193

15 Ideas and institutions: who is framing what? 206

Morten Bøås is a Researcher at Fafo – Institute for Applied International

Alice Sindzingre is Research Fellow at the Centre National de la Recherche

Closely related to these modifications and distortions, and often underlying

ADB Asian Development Bank

NGOs Non-Governmental Organizations

achieved with the minimum of conflict or pressure. A good example, analysed at

Institutions, ideas and approaches

ical approach, we locate ourselves within the nexus of realism, constructivism

1 institutional approaches (e.g. Sikkink 1991; Goldstein and Keohane 1993)

Ideas and multilateral institutions: from informal

between knowledge and policy in the case of international population policy,

development assistance and technical cooperation programmes of the United

and then later, as the processes of decolonialization accelerated, in so-called

This means that in comparison to other social units, multilateral institutions

intentional meanings of the word ‘development’. This conceptual pair, intro-

Proposal for a Bank

The Saint-Simonians proposed a system of banks, headed by a national bank

The Bank realized

… our imponderable resources in the technical knowledge are constantly

Truman was explicit about posing development as an alternative to communism, ‘the

Dependency theory: bringing capitalism back in

Both [modernization theory and dependency theory] are trapped, albeit to

Dependency theory not only replicated the dichotomy of ‘developed’ and

opment with an expert knowledge of underdevelopment. The underdeveloped

there exists a veritable underdeveloped subjectivity endowed with features

The conceptual pair of development and underdevelopment is therefore seen

The role of ideas: can the idea of development be

juridical system to an expression of popular justice after the revolution can

The future of the idea of development

Expert domains and public policy

What exactly are ideas?

Knowledge production, dissemination and