In this ODI Briefing Leni Wild and Marta Foresti argue that beyond recognising that institutions matter for development, the key questions which remain to be addressed are:
How should governments that are striving to achieve more equitable and efficient service delivery approach the challenge of institutional reform?
And how can the international community best support pathways to institutional reforms for more equitable delivery of essential public goods and services?
A close look at recent evidence suggests that some consensus is emerging around how to answer these ‘so what’ questions. Recent research has moved beyond the recognition that ‘context matters’ to specify just how it matters and what limits the capacity of institutions to implement policies and deliver results. Furthermore, efforts to build evidence-based policy analysis is moving beyond describing and explaining institutional failure, to identify what solutions and models work best in addressing the underlying causes of failure. This has significant implications for international support, and for the role of donor agencies.
First, there is a common recognition of the need to start with comprehensive diagnosis of the underlying problem as part of any reform solution.
Second, while institutional problems are inherently complex, they can be tractable. This requires flexible pathways to explore problem-solving, allowing for iteration and for dynamic and strategic changes to planning.
Third, it is important to work with what exists rather than with what is ideal. This means engaging with ‘practical hybrids’, that is, blends of pre-existing institutions and norms in order to achieve change.
Finally it is important to recognise that reforms must be driven by domestic actors, and external agencies can only ever play a minor role.
Achieving such change may, ultimately, require turning the lens back on to aid agencies themselves – examining how aid is allocated, how decisions are taken, and how development is communicated. Much of the attention to date has focused on understanding how institutional reform happens within a range of developing countries, but we also need critical reflection on what it will take for international assistance to change.