On "Good" Politicians and "Bad" Policies : Social Cohesion, Institutions, and Growth

Social cohesion - that is, the inclusiveness of a country's communities - is essential for generating the trust needed to implement reforms. Citizens have to trust that the short-term losses that inevitably arise from reform, will be more than offset by long-term gains. However, in countries divided along class and ethnic lines, and with weak institutions, even the boldest, most civic-minded and well-informed politician (or interest group) will face severe constraints in bringing about policy reform. The authors hypothesize that key development outcomes (particularly economic growth) are most likely to be associated with countries that are both socially cohesive and governed by effective public institutions. They test this hypothesis for the sample of countries with available data. The authors develop a conceptual framework based on the idea of social cohesion, then review the evidence on which it is based. While several earlier studies have shown that differences in growth rates among developing countries are a result of weak rule of law, lack of democracy, and other institutional deficiencies, the authors focus on the social conditions that give rise to these deficiencies. They also seek to establish empirically a causal sequence from social divisions to weak institutions to slow growth. The essence of their argument, supported by new econometric evidence, is that pro-development policies are comparatively rare in the developing world less because of the moral fiber of politicians (though that surely matters) than because good politicians typically lack the room for maneuver needed to make desired reforms. This lack of maneuverability is a product of insufficient social cohesion and weak institutions. The authors also explore the determinants of social cohesion, focusing on historical accidents, initial conditions, and natural resource endowments. Social cohesion should not be seen as a concern primarily of developing and transition economies. Indeed, it is important in the United Kingdom as in Ukraine, in Canada as in Colombia, in the Netherlands as in Australia.

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Bibliographic Details
Main Authors: Ritzen, Jo, Easterly, William, Woolcock, Michael
Language:English
en_US
Published: World Bank, Washington, DC 2000-09
Subjects:AGRICULTURAL EXTENSION, AVAILABLE DATA, AVERAGE GROWTH, BAD POLICIES, BUREAUCRACY, CITIZENS, CIVIL LIBERTIES, CIVIL SOCIETY, CIVIL SOCIETY ORGANIZATIONS, COLLECTIVE ACTION, COMMUNITIES, CONCEPTUAL FRAMEWORK, CORRUPTION, CRISES, CROSS COUNTRY REGRESSION, DATA SET, DEMOCRACY, DEVELOPED COUNTRIES, DEVELOPED WORLD, DEVELOPING COUNTRIES, DEVELOPING COUNTRY, DEVELOPING WORLD, DEVELOPMENT ISSUES, DEVELOPMENT POLICIES, DEVELOPMENT POLICY, ECONOMIC ACTIVITY, ECONOMIC GROWTH, ECONOMIC PERFORMANCE, ECONOMIC POLICIES, ECONOMIC POLICY, EDUCATION SYSTEM, EMPIRICAL RESULTS, EMPIRICAL SCRUTINY, ETHNIC DIVERSITY, ETHNIC FRACTIONALIZATION, ETHNIC GROUP, ETHNIC HETEROGENEITY, EXTERNAL SHOCKS, FACTOR ENDOWMENTS, FINANCIAL CRISIS, FORMAL INSTITUTIONS, GINI COEFFICIENT, GLOBAL ECONOMY, GLOBAL MARKETS, GOVERNMENT EFFECTIVENESS, GROWTH COLLAPSE, GROWTH RATES, HOUSEHOLD LEVEL, HUMAN CAPITAL, HUMAN DEVELOPMENT, INCOME, INCOME COUNTRIES, INCOME DISTRIBUTION, INEQUALITY, INEQUALITY INDEX, INSTITUTIONAL QUALITY, INTEREST GROUP, KEY DEVELOPMENT OUTCOMES, LABOR FORCE, LIVING STANDARDS, LOCAL SOCIAL CAPITAL, LONG TERM, LONG-TERM UNEMPLOYMENT, LOW- INCOME COUNTRIES, MACROECONOMIC ENVIRONMENT, MACROECONOMICS, MIDDLE CLASS, MIDDLE CLASS CONSENSUS, MIDDLE CLASS SHARE, NATURAL RESOURCE, PARTICIPATORY PROCESSES, PER CAPITA GROWTH, PER CAPITA INCOME, PHYSICAL CAPITAL, POLICY REFORM, POLICY RESEARCH, POLITICAL CONFLICT, POLITICAL INSTABILITY, POLITICAL INSTITUTIONS, POLITICAL LEADERS, POLITICAL RIGHTS, POLITICAL TENSIONS, POLITICIANS, POOR COUNTRIES, POOR GROWTH, PREDICTED GROWTH, PROPERTY RIGHTS, PUBLIC INSTITUTIONS, RANDOM SAMPLE, REGULATORY BURDEN, RELIGIOUS GROUPS, RESOURCE ENDOWMENTS, RULE OF LAW, RULE OF LAW QUALITY, RURAL AREAS, SAFETY NET, SENSITIVITY ANALYSIS, SOCIAL CAPITAL, SOCIAL CHANGE, SOCIAL COHESION, SOCIAL CONDITIONS, SOCIAL DIVISIONS, SOCIAL EXCLUSION, SOCIAL INDICATORS, SOCIAL INSTITUTIONS, SOCIAL SAFETY, STATISTICAL ANALYSIS, STRUCTURAL FACTORS, TRANSITION ECONOMIES,
Online Access:http://documents.worldbank.org/curated/en/2000/09/693293/good-politicians-bad-policies-social-cohesion-institutions-growth
https://hdl.handle.net/10986/19790
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