Scholars of development often vent their frustrations by identifying the culprits that keep their theories from working. Recently, an old favorite has been brought back into the dock with new vehemence. Instead of the peasant clinging to traditional values or the multinational manager funneling surplus back to headquartesr, the state bureaucrat, strangling the golden goose of entrepreneurship and lining his pockets with unproductive rents, has again become the central villain.
From an article by Peter Evans published in 1989, ties back into why Ryan’s United Fruit plan is good for cornering the market on bananas, but maybe not the best for developing serious trading partners.
Evans first outlines why bureaucracies are necessary,
Smith’s “natural propensity to truck and barter” had not sufficed to produce the rise of the market in England. Instead […] “The road to the free market was opened and kept open by an enormous increase in continuous, centrally organized and controlled interventionism.” From the beginning […] the life of the market has been intertwined […] with the forms and policies of the state.
and then describes what happens when developing state bureaucracies are awesome (Japan), not-so-awesome (Brazil), and a hot mess (Zaire). He suggests
- that states need autonomy
- that their bureaucracies need to be autonomous (in the sense that they follow their own institutional norms, as opposed to responding to the “invisible hand”)
- that their bureaucracies need to be “embedded” (in the sense that they can bridge the government with the business world.)