Arthur A. Goldsmith

Democracy, property rights and economic growth

What does the global surge in democracy and capitalism portend for economic growth? The shift toward popular government is predicted by some to accelerate growth, by others to retard it. Often left out of the equation is property rights as a factor distinct from democratic rule. Using recent data on 59 less developed and transitional countries, this article explores the relationship among institutional factors and growth in the 1980s and early 1990s. Democratic freedoms and property rights are associated with the dependent variable, suggesting that national income in poor countries stands to gain from recent efforts to implant these institutions.

Promoting the sustainability of development institutions: A framework for strategy

Abstract This article presents a generic framework for understanding institutional sustainability in development. Its lessons draw from the agriculture and health sectors. The framework treats institutions as: (a) systems that function in relationship to their environments; (b) organized and managed entities whose organizational structures and procedures must match the tasks, products, people, resources, and contexts they deal with; and (c) settings intimately concerned with the exchange of resources where economic and political relationships intertwine to create varying patterns of power and incentive. Application of the analytic framework has shown that institutional sustainability depends upon maintaining: responsive output flows (high quality and valued goods and services); cost-effective goods and services delivery mechanisms (organization and management); and resource flows (recurrent costs, capital investments, human resources).

The private sector and rural development: Can agribusiness help the small farmer?

Abstract There is considerable interest today in getting the private sector more involved in rural development. One potential means is the “core-satellite” model, where corporate food processors link up with small farmers through production contracts, exchanging agricultural inputs and services for assured deliveries of produce. Despite some attractive features, however, the model is feasible only when specific economic, technical, and social conditions prevail, conditions including active government support.

Institutional Dualism and International Development A Revisionist Interpretation of Good Governance

This article examines the tensions, trade-offs, and complementarities between so-called good governance and bad governance in international development and draws on U.S. history to comment on current change efforts. Aid donors have ambitious plans to encourage countries to replace corrupt or closed public institutions with more accountable systems. Yet democratic or rational-legal governance does not necessarily represent an improvement over ostensibly improper governance. It is important to bear in mind that certain clientelistic practices have hidden positive functions, such as giving poor people access to resources. Governance institutions are neither bad nor good in themselves; outcomes are what matter.

Making the World Safe for Partial Democracy? Questioning the Premises of Democracy Promotion

Democracy promotion is a favored strategy to advance the cause of world peace, especially in the Greater Middle East, but undifferentiated democracy promotion has two faulty premises. First, all progress toward the establishment of democratic regimes does not necessarily make the global community safer. Second, regime change is not something external actors have the capacity to direct along desired pathways. The first assumption fails to consider the well-documented security problems caused by partial democracies. The second assumption overstates the ability of powerful outsiders to induce transitions to full democracy. These research findings are grounds for cautious and selective democracy promotion, not a blanket approach that is indifferent to the composition of the regimes designated to be reformed and democratized.

Economic rights and government in developing countries: Cross-national evidence on growth and development

Most analysts assume that economic rights (especially to property and to contracts) help foster economic development, but the relationship is rarely studied empirically. Using three recently developed indexes of economic freedom, this article explores this issue for the mid-1980s to the mid-1990s. It finds that developing countries that score better in protecting economic rights also tend to grow, faster and to score higher in human development. In addition, economic rights are associated with democratic government and with higher levels of average national income.

Institutions and Planned Socioeconomic Change: Four Approaches

How have development administrators handled the needfor institutional changeover thepastfour decades? Institutions are regarded as central to the success of Third World development efforts, and over the years four different approaches have been used to deal with that need. As Arthur S. Goldsmith shows, early efforts at specific institution building were followed by a broader strategy of institution development. More recently, attention has turned to the new institutionalist approach. It stresses (1) the need to work on providing individuals with appropriate incentives, and (2) strategies based on the need to create sustainable institutions that link development programs and their constituents

Strategic thinking in international development: Using management tools to see the big picture

Abstract This article looks at the relevance for international development of strategic management, a set of methods for helping managers to align organizations with their environments so they can get to their important objectives. The methods have been applied recently in many developing countries. Results are mixed. When taken seriously, strategic management can promote participatory decision making and adaptability. Yet, success in organization strategy depends more on the right mental outlook than on specific techniques — techniques that can themselves sometimes turn into an impediment to open, creative thinking. Strategic management works best when understood as a way to learn, not as a prescribed remedy to follow.

How Citizens Participate in Macroeconomic Policy: International Experience and Implications for Poverty Reduction

Summary. — Many developing and transitioning countries have difficulty sticking to sound macroeconomic policy.International donors are pushing recipient countries to forge a public consensus on macroeconomic policy as a means to enhance sustainability and impacts on the poor. Finance and budget officials, central bank staff, and economic policymakers, however, often assume that citizens cannot understand or contribute to macroeconomic policy.Yet the poor often do not trust the government to make the right decisions for them.How can citizen participation help bridge this gap? Based on a review of international experience, the paper explores this question, and identifies how development administrators can employ civic participation in macroeconomic policy.The discussion highlights where citizens have the greatest options for participation, and notes the impacts participation can have on fostering policies and outcomes that target poverty reduction. 2003 Elsevier Science Ltd.All rights reserved.

Democracy, Political Stability, and Economic Growth in Developing Countries: Some Evidence on Olson's Theory of Distributional Coalitions

Mancur Olson has theorized recently that interest groups and “distributional coalitions” are a major factor in the rise and decline of nations. He argues that the tendencies of these organizations to multiply and to support distributive policies lead to economic and political stalemate, particularly in the most stable, democratic societies in which pluralism has its greatest scope. The bulk of evidence for Olsons theory comes from the industrialized world; in this article I test three of its propositions against the experience of seven stable liberal democracies in the developing world. The theory predicts that with time such societies will reduce investment for the sake of consumption, will expand their public sectors, and will grow slowly in economic terms. Economic trends in the sample countries fail to confirm the first two propositions but offer tentative support for the third.