A key argument in my book is that reforms that actually improve functionality and yield institutions that work in complex contexts typically happen step-by-step. In Mozambique I say poco-a-poco.
The book explains the rationale for this by referring to the 'muddling through' work of Charles Lindblom. I argue that we need to create processes of 'purposive muddling' to overcome the limits of institutional reform in development.
In a recent executive education course (on Public Financial Management) a student helped me think about a visual representation of my argument. I thought I would share it here.
The first picture here shows the simple challenge that many governments face in development. They have low functionality (an education system that does not educate or a roads department with poorly maintained roads, etc.). They also have low levels of legitimacy, meaning that the citizens they are meant to serve are fed up with them or that outside entities on whom they depend (donors, etc.) don't think they are up to the job they are doing. These internal and external agents hold back support (often in the form of finances) because of the low legitimacy.
The second picture shows the common response to this challenge. Governments are unsure how to increase their functionality, partly because the problems they face seem absolutely impossible to understand and deal with (and are hence not given the attention they require), incumbent rules of the game are too difficult to overcome, capacity is low, etc. Instead of working against these factors and putting political or bureaucratic capital behind some or other untested and high risk potential solution (that could enhance functionality) many government officials look for 'solutions' that are being proposed by those whose support they need. These are often 'best practices' that outsiders see as routine solutions and 'the right thing to do.' The best practices are attractive because they are pre-packaged and garner important short-term support. In development this support typically comes from donors but is also often forthcoming in the local context as well (doing the 'best practice' reform mean more money in the national budget, better performance on global indicators of management and governance, etc. which can all help to build political support at home). [This is isomorphism…the word you will see throughout the book and beyond]
Now some may do reforms like this just to gain legitimacy, as in the arrow moving up the left hand side of the graph. But some may also assume that these 'best practices' will actually—in time—yield better functionality. In my book I argue that this assumption is frequently proved to be incorrect, however. Best practice reforms do not fit into the many contexts where they are adopted, demanding more content than local capacities can provide, and involving too few agents to actually become implemented. The result is reform with limits: laws that are not implemented, central agencies that have no authority, etc. In the book I call this the problem of 'What you see is not what you get' (wysinwyg). When reforms are shown to be limited, reformers commonly blame the design and initiate a 'better' version. I call it repeat signaling and I see it as a major disease in development. In work I have done with Lant Pritchett and Michael Woolcock we call this the 'successful strategy for persistent failure in development'.
The book—and work with Lant and Michael—suggests a different strategy for doing institutional reform and development. We call it problem driven iterative adaptation (PDIA). The approach embraces the importance of step-by-step interventions that are required when problems are complex and reformers have to i) learn in order to 'find and fit' functional reforms, ii) build and maintain legitimacy and support to get reform done, and iii) build and adjust capacity to ensure implementation is achieved and emerging solutions can be diffused. The approach is shown in the figure below. The basic idea is that reformers in these situations draw attention to the problem they are facing, which they then use to build basic support and legitimacy for some step-by-step experimentation. They take some initial steps, trying various potential reform options at a time. They ensure there is lots of feedback for them to learn what works and why, and they manage the message after these early steps to ensure they can tell some stories about 'quick wins'. They use these messages to build their legitimacy a little more, convincing political leaders, outside funders and citizens that they are on track to solve problems and gaining support for a next step.
This iterative process continues over time until a new solution has been found, fitted and diffused and enjoys legitimacy because it improves functionality.
In the book I argue that successful reforms always emerge through this kind of process. The problem that I see is that this is prohibitively different to the formal way international development organizations work. For these organizations , muddling through is a synonym for 'being muddled' and learning and adaptation are not encouraged or rewarded. Projects must be pre-designed around best practice solutions in order to get support in these organizations. There is little space to support the step-by-step realities of finding and fitting solutions, building political support and capacity, and diffusing new institutions.
The result, unfortunately, is that many institutional reforms in development are ultimately limited….