What can political economy analysis contribute to humanitarian aid interventions? How can agencies undertake such analysis in difficult environments? This report chapter from the Overseas Development Institute introduces the findings of a study (2001-2002) of four cases: Afghanistan, the eastern Democratic Republic of Congo (DRC), Sierra Leone and the Casamance in Senegal. Political economy analysis is best conducted alongside existing humanitarian operational activities via integration into existing analytical tools.
When applied to situations of conflict and crisis, political economy analysis seeks to understand both the political and the economic aspects of conflict, and how these combine to affect patterns of power and vulnerability. A political economy approach should incorporate a wide historical and geographical perspective, explain why the relative power and vulnerability of different groups changes over time, and explain how the fortunes and activities of one group in society affect others. It encourages a dynamic, broad, longitudinal and explanatory perspective.
The political economy approach demonstrates that conflict transforms society, rather than simply destroying it, causing people to adapt in order to survive, or to capitalise on opportunities. Many of the key themes from the case studies, however, are applicable to societies suffering extreme poverty, political instability and weak governance institutions, whether violent conflict is present or not:
- War, ‘shadow’ and survival economies are intertwined, with many actors engaged in more than one type.
- Local level coping strategies vary considerably among areas, groups and even villages and households within the same area. Influential factors include location, security regimes, local governance and social networks, and access to roads, markets and water.
- In any conflict, different forms of violence are likely to co-exist: from organised warfare and systematic economic violence, to individual criminality and economic opportunism, and violent survival strategies such as joining a militia.
- A historical, regional and international perspective is crucial to understanding complex emergencies.
- Economic imperatives and commercial agendas become intertwined with social and political crises. Patterns of vulnerability may change rapidly and endemic insecurity and vulnerability can itself generate extreme local political sensitivities.
- Rumour and innuendo can be as important as fact.
Two approaches – commodity chain analysis and livelihoods analysis – lend themselves particularly well to supporting political economy analysis. The most significant challenge agencies face is institutional – how to integrate political economy analysis into mainstream activities at all levels, and how to ensure that this analysis is linked effectively to, and informed by, operations at field level.
- Commodity chain analysis identifies power relations, governance structures and exchange relationships within commercial networks, from primary production to consumption. Of particular interest to political economy analysis is the identification of who controls commodities and exchange at particular levels.
- Livelihoods analysis is cross-sectoral, and examines the economic, political, social and cultural factors affecting people’s lives and livelihoods, from the local up to the international level. It can provide much of the local and sub-national data that political economy analysis requires plus a framework and (comparatively safe) methodology for local level research.
- In order to be applied effectively, analysis and understanding need to be shared both within and between organisations.
- Judgements about how to use political economy analysis appropriately will be agency- and context- specific. It is where humanitarian relief meets protection, peacebuilding, rights-based programming and livelihoods support that these judgements may be most difficult, and where good analysis may matter most.
