WHY DEVELOPMENT IS POLITICAL
Development politics
Many disciplines study development around certain questions and with their own core focus
o E.g. Development studies ask for example why some countries develop while others
don’t, and similar question Our goal is to understand the politics (power relations, decision
making, actors involved, power asymmetries, policies) attached to development
Development is political
Short historical overview of trends, ideas, institutions and actors working on the IR of
development post-WWII to present How we define development is political
o Constructivism and Poststructuralism
International efforts at promoting development are a continuation of conventional IR between
states (conflicts, interests, power asymmetries)
o Realism and some other perspectives
Development is embedded in the politics of the past (most significantly colonialism)
Questions of relative success in development are embedded in global political economic
structures, most significantly trade Addressing development transnationally is political
SHORT HISTORICAL OVERVIEW: FIVE STAGES IN POLITICS, PRACTICE OF AND THOUGHT
ON INTERNATIONAL DEVELOPMENT
Obsession with development has roots in 18th century
The onset of the era of modern economic growth begun in western Europe with the Industrial
Revolution in Britain in the 18th century.
o Since Britain’s successful industrialization, modernizing elites around the globe have
attempted to emulate this feat
Stage I
Ca. 1945 – 1955
Until the Second World War, a country’s industrialization was perceived almost solely as a
national objective. Economic growth was understood primarily in terms of industrialization
and proceeded without appeals for international assistance o This phase came to an end
when, in the postwar era, the promotion of economic growth in poorer countries became an
international issue.
Post-War US-supported reconstruction in Europe and N-A
o Marshall Plan represented the start of economic reconstruction in the form of
Transatlantic cooperation with money flows coming from US to Europe
o Fordist-oriented industrialization
Mass assemblies and assembly lines
Specialized development of labour
Those that work in assemblies also consume
Decolonization and focus on former colonial commodities
o Africa and Asia especially go through a profound transformation
o Short run: Many of the economies, and so their development strategies, of these
decolonizing countries still focused on many of the commodities that had been
planned and governed by the colonizers
Evolution Cold War leading to political alliances between developed and developing countries
, o Proxy wars within third party countries, such as Latin America, Asia, and Africa
o Ideological disagreements also implies disagreement over what strategy of
development was best State led vs. market driven
Declining terms of trade
o Price of exports fall compared to imports
Imports more expensive so country’s living standards worsen
This is the result of mainly importing lots of industrial goods and exporting lots of
raw materials that are lower in price
o Presented a dilemma for development strategists
Stage II
Ca. 1955 – 1970
Expansion of industrial Fordist capitalism in N-A and Europe
o Expansion state (Welfare state)
State’s responsibility for ever larger aspects of citizens’ life
Affecting social development of individuals in society
Development conceived as a project of a strong and active government.
In the Keynesian postwar compromise, states were expected to establish a balance between
supply and demand for goods, encourage consumption, promote the growth of domestic
industries and provide a safety net for their citizens in the form of social welfare.
o Keynesian economic theory sought a balance between non-intervention in the market
by the state and guided control.
The quest for economic development was shaped and moulded by developments in the
world economy and by the attitudes and actions of governments and international
organizations
o Striking characteristic of the international economy for most of this period was
economic recovery and strong growth trends, especially among the advanced
industrial countries
from the perspective of policy-making, it was the ‘terms of trade’ argument that made most
impression. o Simply put, the terms of trade thesis alleges that there is a persistent
tendency for the value (or terms of trade) of primary commodities to fall vis-à-vis
manufactured exports.
Import Substitution Industrialization experiments in Latin American and Africa
o Development paradigm start in different countries
E.g. Ghana, Tanzania
They try to deal with the dilemma of declining terms of trade
o Protect emerging industries
Stop industrial goods entering the country
o Industry over agriculture
Mimic industry at home
o It provided the economic rationale for preferential access for the manufactured exports of
developing countries. If dependence on primary commodities condemned developing
countries to a foreign exchange gap, it was logical to support their diversification into
manufactured exports.
o The experiment went on for decades
OECD Donors
o Development cooperation relations with post-colonial states to further
development of these economies Little spill-over of industrial revenues to other parts of
economy
o It was believed that economic growth would trickle down from the rich to the poor within
societies. Over time, it became apparent that this optimism was ill-founded.
Stage III
Ca. 1970 – 1980
Turbulent decade
Debt-led, income- and redistribution-focused growth in many developing economies
o Especially post-colonial states experiment with debt led financial markets
, International Labor Organization
o OECD Donors
o World Bank during McNamara era
o Start looking not only at GDP of countries but also at the disaggregate level and
development of the individual Stalling growth in N-A and Europe
o Nixon president of the U.S.
Less ambition to rule the world
Dollar stops being stability point
Oil crisis
o Eurodollars’ importance grows
o Between 1947 and 1971, the world economy experienced unprecedented growth. This growth
began to falter in 1971 with the collapse of the Bretton Woods system of monetary
management and came to an end after the first oil crisis of 1973–4.
o The first oil shock triggered, but was not solely responsible for, the onset of global
recession in 1974. Non-oil exporting developing countries were faced with a
severely deteriorating balance of payments. It was in this period that Third
World debt began to grow as governments borrowed to meet their obligations.
o The second oil shock of 1979 plunged many countries into severe balance of payments
problems, and heralded the difficult times ahead
The downturn in the world economy in the mid1970s and the failure of industrialization and
trickledown policies led to a new approach.
o The ‘basic needs’ approach, which gained support from the ILO and World Bank in the
mid-1970s, rejected trickle down policies and argued for redistribution with growth, and
also replaced the focus on industrialization with one giving greater attention to
agriculture and the rural sector.
o Moreover, research on gender and development began to show the necessity to bring
such considerations to the forefront.
G77 resist super-power dominance
o Non-aligned movement of third world countries
Created in 1960, although mainly concerned with political issues, progressively
addressed what it saw as the failures of the postwar liberal international
economic order, and was instrumental in making reform of this order a key
diplomatic issue in the 1970s.
o New international economic order
o Post-colonial governments want decision making powers
Wanted their space to make rules, to decide, united resist the domination of super-powers
Stage IV
Ca. 1980 – 1990
o Aftermath of demise of Bretton Woods
Europe and N-A focus on curbing government spending
o Lower government debt and focus on markets, as start of the decade of neo-liberal ideas
Neo-liberalism and Structural Adjustment
Focus on balanced government account
Privatize public sector and liberalize markets
Washington Consensus?
o IMF and World Bank, increase of trade as following of GATT
o Economic ideas of neoliberalism flow into ideas about development
o If not growing, then focus on balanced government account
o Ideas started being imposed by IMF, etc., on policies of regimes, starting to demand structural
adjustments
n, deregulation, wage suppression, credit reduction, a bias towards the export sector, and a
penchant for free markets.
o NGOs given a greater role in development
Japan, Asian Tigers, NICs
o Export oriented growth, that is capitalist in nature, but state coordinated
o South East Asia starts inspiring other countries, especially from Africa to experiment