written by Lant Pritchett
The period between the end of the American Civil War and the end of World War II saw a transformation of America with the rise of dominant large organizations in both the private economy and public life. The economic historian Alfred Chandler’s in The Visible Hand and Scale and Scope documents the rise of “managerial capitalism” with large economic bureaucracies in the railroads, oil, steel, automobiles, electricity, and telecommunications establishing new foundations of a productive economy.
Similarly, in nearly every domain of engagement the organization of the state became more centralized, more bureaucratic, more centrally controlled. Or, as this is typically described, the “Progressive Agenda” caused governance to become more “professional” more “scientific” more “efficient” as bureaucratic hierarchies displaced localism and Ostrom-esque “polycentric” systems. Historians of the US tell this story about many fields and organizations.
Samuel Hays Conservation And The Gospel Of Efficiency: The Progressive Conservation Movement, 1890-1920 is summarized as: “Against a background of rivers, forests, ranges, and public lands, this book defines two conflicting political processes: the demand for an integrated, controlled development guided by an elite group of scientists and technicians and the demand for a looser system allowing grassroots impulses to have a voice through elected government representatives.” In the end the “modern” organizations of management of publicly owned lands—but only after having to struggle to prove the improved effectiveness of their methods against continued powerful opposition.
Daniel Carpenter’s The Forging of Bureaucratic Autonomy: Reputations, Networks, and Policy Innovation in Executive Agencies, 1862-1928 narrates the rise of (among other organizations) the “modern” Post Office as a centrally controlled civil service bureaucracy. It had to struggle itself into control of the post against powerful political forces and local resistance that supported the former Jacksonian system of locally appointed postmasters.
Education historian David Tyack’s The One Best System: History of American Urban Education tells of the rise of the urban school system as a “modern” and “scientific” organization that struggled—with mixed success—to consolidate and control the myriad of locally controlled schools and school districts. American began the century with 150,000 school districts, down to around 15,000 today.
Hernando de Soto, though not an academic historian like the others, tells “The Missing Lessons of US History” in chapter 5 of his Mystery of Capital. He shows that property rights in the US as the country expanded westward were a constant struggle between local systems of de facto recognition of use and attempts at de jure top-down ordered and rational systems. In this struggle the de facto usually won politically and the law changed to acknowledge the reality, rather than vice versa.
In each of these cases narratives of “scientific” and “efficiency” and “rational” and “ordered” and “modern” were used to justify placing ever greater power into the hands of centralized organizations. But these organizations had to struggle against counter-claims of people and grass-roots movements and local politics who knew they were losing power. Westerners strongly resisted the claims of the “conservation” movement that they should be given consolidate power over land use. Parents resisted being sidelined in their control of the schools. People with de facto usufruct rights over land resisted the formal legal claims against their control. Local postmasters resisted the increasingly central control of the post office.
In this struggle they used their rights as citizens for a variety of modes expression of opposition and their voice in democratic processes. The result was a messy, protracted, conflicted struggle.
I take one of the main points of Bill Easterly’s new book The Tyranny of Experts: Economists, Dictators, and the Forgotten Rights of the Poor to be that the mainstream “development” process underestimated the necessity of the struggle. That is, it was thought that “modernization” could be achieved as a purely technical exercise in which the demonstrable successful organizations and institutions of the “developed” world could be transplanted to other countries. Why should the newly sovereign country in the 1950s and 1960s “struggle” towards an effective Post Office when there exist working models throughout the world (US Post Office, Royal Mail, Bundespost)? It was believed that “modern” police forces, schools, roads, courts, forest services, water companies—the organizations that make a state capable and deliver what the state promises—could be created without all of the bother of citizens being empowered to not just vote, but also resist, to subvert, to complain, to protest, to organize and agitate.
There are a variety of conjectures as to how and why this possibility of “transplantation” through development could actually, in some instances, make things worse.
One, organizations could gain legitimacy simply from mimicking the forms of rich country organizations without their function. Sociologists of organizations call this “isomorphism” and describe the pernicious impacts of allowing organizations to attract support without having to demonstrate superior functionality.
Two, the availability of resources from development agencies who were more familiar with and expected to see “modern” organizations meant that accountability to citizens could be attenuated.
Three, by changing the nature of the struggle the “experts” were not forced into a process of testing their ideas and notions and ways of “seeing like a state” against direct and immediate feedback—and push back—from local realities. Mistakes of mismatch between what the “experts” recommended and the reality of what could work in the local context could be larger and persist longer when insulated from the test of functionality.
But you cannot juggle without the struggle. The fact that someone else can juggle, and can show you how to juggle, and describe juggling in great detail does not mean that functionality is transferable. By changing the nature of the struggle many developing countries are stuck with state organizations that just cannot juggle.