Economic and political development requires capable states. But what happens when states that need to build capacity for development and governance are weakened by crisis? This book, published as part of the Cambridge Studies in Comparative Politics series, analyses the ways in which state capacity is built, destroyed and rebuilt. It argues that crises can produce innovation in ideas, policy and government.
In the 1980s and 1990s, states in Latin America and Africa were challenged by economic crises and growing pressure for political reform. They had to re-define their relationship with the market and civil society. Mexico and Kenya are used as case studies because, when crises occurred, they had enjoyed sustained growth and strong political institutions. Their experiences show how economic decline and political upheaval can undermine and transform even relatively effective and stable states. By examining responses to pressure to improve the institutional, technical, administrative and political capacities of government, the book reveals opportunities for political leadership during crises. Civil society also has a key role to play in demanding more open and transparent states and bringing about change.
During the 1980s and early 1990s, developing countries were under international pressure to implement free-market economic policies. The crises faced by many revitalised civil society, which often demanded democratic government and human rights. Mexico and Kenya represent the specific problems faced by countries in their respective continents:
- In Mexico, the crisis was primarily economic, displaying the impact of huge external debt and structural dislocations.
- In Kenya, the crisis was to a large extent political, arising from efforts to alter the beneficiaries of state policies and create alternative sources of power.
- The institutional capacity of both states declined to very low levels in the 1980s. Mexico was more successful in building a consensus to introduce new rules for economic and political interaction.
- Technocrats in Mexico achieved high levels of influence and input into policy making, perhaps because the crisis was economic. In Kenya, they were marginalised by rent-seeking politicians.
- Administrative capacity was reduced in both countries as budgets were constrained. Implementation of reform initiatives was weak.
- In both countries, politicians and political institutions faltered in their ability to control dissent and demands for reform from civil society.
Leaders in both countries were powerful and had control of resources that allowed them to make political reforms. However, their efforts were viewed differently by investors and international agencies:
- In Mexico, early scepticism was assuaged by improving economic conditions and coherent political messages. There was, however, little concern for civil society participation and representation.
- In Kenya, increasing state centralisation and authoritarianism created doubt about future economic growth, undermining confidence in the system.
- In political systems that depend heavily on their leaders, abuse of the system can damage the basis for economic development. That may motivate civil society to demand greater accountability and reform.
- Fully capable states are most likely to emerge and persist in a democratic context where civil society has the ability to contest the state and its leaders.
