What is the relationship between democracy and development? What are the problems of aid that is conditional upon political reform? This extract reviews the changing perspectives on the relationship between political systems and development since World War II and the evidence that supports them. It goes on to consider the problems of adopting political conditionality as a World Bank policy.
Despite changing ideology surrounding the relationship between democracy and development in the post-war era, evidence to support these changes has lacked consensus. Donors including the World Bank have changed their opinions regarding the extent of the role of the state in development and economic growth. Donors now insist that democratisation should be a condition of aid despite the numerous problems of political aid conditionality.
The orthodoxy on democracy and development has been the subject of much debate and adaptation. In the post-war era democracy was thought to follow economic growth. Trade-offs between democracy and development made them contemporaneously incompatible. Poor countries could neither successfully implement nor sustain democracy.
- Economists toed this line in developing structural adjustment programmes (SAPs). SAPs required a strong autonomous state to implement economic liberalisation and democracy could potentially undermine this growth.
- ‘Democratic peace theory’ became popular in the 1980s, particularly in the US. It stated that democracies did not go to war with each other and made better trade and diplomatic partners. Democracy became a development goal.
- Despite its popularity, the empirical and theoretical basis for the democratic peace theory is keenly disputed. Some claim its popularity lay in its flattering of Western values.
- To support this position, economists tried to prove that democracies achieved better economic growth. Again, however, the evidence lacks consensus. Strong states can facilitate growth whether democratic or authoritarian.
- Much of the research associating democratic regimes with better growth is methodologically flawed. However, belief in the moral superiority of democracy continues to drive similarly biased research.
This legitimisation of democratic ideology has contributed to the donor practice of political conditionality in which a paradox arises from conflict over the role of the state. Post-war the state was considered the driver and dominator of growth, in the 1980s it was considered a hindrance and its role minimised. Its role as facilitator of administrative capacity has been reintroduced. However, the minimalist state created by SAPs is unable to implement the sweeping political reforms currently advocated by the World Bank. Other criticisms of political conditionality include:
- Southern authoritarian leaders fear the dissolution of the status quo, but also that rapid externally driven liberalisation will cause ethnic and civil unrest.
- Political conditionality may mask a donor agenda to re-colonise Southern states.
- Economic conditionality was difficult to evaluate and political conditionality is even harder. Some political objectives may be beyond government control or impossible to accurately measure.
- Conditionality has not increased investment in Africa. Conditionality itself deters investors who (often correctly) do not believe Southern governments are committed to reforms.
- Renewed attention to the role of the state has lead to the re-thinking of conditionality in terms of good governance and anti-corruption. This can serve to unfairly lay the blame for inappropriate donor strategies on the poor.
