What is the relationship between governance and poverty? Do democracies eliminate poverty more effectively than authoritarian regimes? This working paper from Stanford University’s Centre on Democracy, Development and the Rule of Law suggests that the obstacles to the elimination of poverty are largely political. Poverty is generated and reproduced by power disparity and abuse. The enduring reduction of poverty requires a broad context of good governance, beyond the narrow arena of free and fair elections.
The deepest root cause of development failure is bad governance – the inability or unwillingness to apply public resources effectively to generate public goods. Good governance involves the capacity and commitment to act in pursuit of the public good, transparency, accountability, citizen participation and the rule of law. Bad governance prevents the accumulation of the financial, physical, social and political capital necessary for development.
Democracy should provide a corrective to bad governance by holding corrupt, unresponsive or ineffectual leaders to account and enabling citizens to participate in making policy. The evidence on the relationship between democracy and development is ambiguous, however. While authoritarian rule offers poor prospects for sustained poverty reduction, democracy does not offer any guarantee of good governance.
The effectiveness of democracy in reducing poverty depends to a great extent on the type and degree of democracy. Democracy can be seen as having three dimensions: electoral competition, civil liberties and responsible and accountable government. The priorities for democratic good governance are:
- Free and fair elections for vertical accountability and democratic responsiveness.
- Democratic political parties. Even where elections are free and fair, political parties themselves may be autocratic, corrupt and hierarchical.
- Independent and effective judicial systems to enforce basic constitutional principles and rights.
- Comprehensive systems of horizontal accountability, including courts, parliamentary oversight, audit agencies, ombudsmen and human rights commissions.
- Pluralistic, open and resourceful civil societies, free to organise and not dominated by NGOs representing narrow constituencies.
Where governance is poor in democracies and quasi-democracies, political parties are a major part of the problem. Work with political parties must be ongoing, integral and sustained:
- Party assistance programmes should focus on five objectives: organisational development, electoral mobilisation, governance, internal democratisation and reforming party and campaign finance.
- Systems of partial public funding for parties and guaranteed media access for campaigns can help to level the electoral playing field.
- Political parties will not be strengthened by party assistance alone. Interest groups and NGOs can be supported to help political parties engage with societal interests.
- Civil society activists can be given training if they opt to enter the arena of party and electoral politics.