post-Washington Consensus Research Articles

Doing ‘Development’ Direct to Sector: The International Finance Corporation and the Financialisation of ‘Development’ in Asia

This paper describes an important new push taking place in development practice, whereby international public organisations are broadening and deepening private sector activity in the underdeveloped world in ways well beyond Washington consensus structural adjustment or even post-Washington consensus (PWC) forms of institutionally-oriented ‘participatory neoliberalism’. Described here as the ‘financialisation of development’ (FoD), this process – which dovetails with the late PWC agenda – is attracting increasing resources that are formally allocated directly to private actors around states, yet which also demand and promote shifts in state form and function that relate to cultivating an ‘enabling environment’ for capital. The International Finance Corporation (IFC) – the World Bank’s private sector arm – is at the vanguard of this process, bridging the ‘public-private divide’ in myriad ways. This paper first conceptualises the project that the likes of the IFC are involved in, drawing upon a framework based upon various lineages of critical political economy. From this perspective, FoD is seen as a rapidly expanding new push within neoliberalism, emerging out of the frustrations of earlier phases of orthodox ‘development’ practice. This approach entails rolling out the market state and establishing market society, two tasks that FoD’s instruments are highly tuned towards achieving. Focusing on the work of the IFC in the Asia-Pacific, the second section of the paper then presents three snapshots of FoD in action. These serve to illustrate the strategies and ‘logic’ underpinning the push, while also pointing to the risks accompanying it.

Trends in Regional Policy in Post-Washington Consensus Period

Trends in Regional Policy in Post-Washington Consensus Period

Institutions and Productive Development Programs in Latin America and the Caribbean: Methodological Approach and Preliminary Results

In the post-Washington Consensus era, there has been renewed discussion of the role of the State in encouraging productivity. This has led to a debate about the role of institutions and programs that form the basis for state interventions to enhance productivity. These interventions, in many instances, take the form of business development services, support for innovation, export promotion, and other programs that target specific sectors and activities. In general, these interventions are called Productive Development Programs (PDPs). Today, governments in Latin America and the Caribbean devote a great deal of resources to PDPs, supporting firms through official agencies and private intermediaries. Despite their economic justification, there is still no well-defined methodology for assessing their performance or for categorizing PDPs according to their type, size, target market, and delivery mechanisms. This document aims to contribute to the development of a tool to analyze PDPs. The methodology for mapping and measuring of institutional performance (MIDI, from its acronym in Spanish) constitutes an effort to quantify and measure the organizational aspects that contribute to a better balance between the costs and benefits of PDPs. The objective of the MIDI is to measure the quality of the programs and the institutions that are behind them and assess their ability to achieve their stated goals. It is in this vein that the MIDI establishes metrics to analyze how these organizational arrangements are planned, implemented, and monitored. The MIDI is based on a questionnaire that allows for benchmarking and comparative analysis at the level of countries and regions within countries. The methodology has been piloted with field surveys in four countries in Latin America and the Caribbean based on an initial questionnaire. From this pilot phase, performance metrics have been developed for the institutions and programs studied, certain common elements have been identified, and some preliminary conclusions drawn—both for improving the methodology and for suggesting new ways to analyze PDPs. The MIDI identifies characteristics of an organizational and comparative nature. At the same time, it allows the formulation of ordinal metrics and the identification of policy recommendations based on variables that are both objective and qualitative. In particular, the MIDI offers guidelines for comparing similar PDPs and the institutions that offer them by measuring their strengths and weaknesses, identifying best practices for dissemination and wider application, and providing a method for mapping programs by type, beneficiary, cost, and other variables. This technical note is divided into the following sections. Section 1 gives a general introduction to what PDPs offer and, in addition, describes the theoretical foundations for their different dimensions and implications for * This technical note is based on a methodological proposal prepared by Gonzalo Rivas and Roberto DeGroote. The company ACE and Dr. Jesus Esteban helped to carry out field tests in Latin America and the Caribbean and contributed to improving the methodology. The authors are grateful to Alessandro Maffioli, Carlo Pietrobelli, Joan Prats, Gonzalo Rivas, and Jesus Esteban for their comments on the first draft.

The forgotten dimension of social reproduction: the World Bank and the poverty reduction strategy paradigm

ABSTRACT This article invokes Gramscian theory in an effort to better grasp the reorganization of social reproduction under neoliberal globalization. It argues that recent transformations in the world development order warrant a rethinking of the concept of social reproduction, towards acknowledging the increasingly apparent role of transnational governance institutions in organizing social reproduction processes, particularly in peripheral countries. To substantiate this argument, the article interrogates the Poverty Reduction Strategy Paper development approach, the most visible policy tool of the post-Washington Consensus. In the Poverty Reduction Strategy Paper process, the World Bank has started to link debt relief administered through the Enhanced Heavily Indebted Poor Country (HIPC II) initiative to the delivery of basic social services to the poor, and directly finances human capital investments through conditional cash transfer programs. While conditionalities attached to Bank funding continue to promote the privatization of various state functions associated with social reproduction, especially in the areas of health care and education, the Bank, at the same time, funds ‘social inclusion’ programs that directly absorb some of these functions. This signals the emergence of a new social reproduction regime of ‘conditional inclusion’ under World Bank leadership.

The Regulatory State and Turkish Banking Reforms in the Age of Post‐Washington Consensus

ABSTRACTThe new era of the Post‐Washington Consensus (PWC), promoted under the auspices of International Financial Institutions such as the International Monetary Fund and the World Bank, centres on the need to develop sound financial regulation and strong regulatory institutions, especially in the realm of banking and finance in post‐financial crisis developing countries. This article uses an examination of the Turkish banking sector experience with the PWC in the aftermath of the 2001 financial crisis to show its considerable strengths and weaknesses. The authors argue that the emergent regulatory state in the bank‐based financial system has a narrow focus on strengthening prudential regulation, whilst ignoring the increased ‘financialization’ of the Turkish economy. They identify the positive features of the new era of the PWC in terms of prudential regulation, which has become much more robust in its ability to withstand external shocks. At the same time, however, the article highlights some of the limitations of the new era which resemble the limitations of the PWC. These include the distributional impact of the regulatory reforms within the banking sector, and notably the emergence of foreign banks as the major beneficiaries of this process; weaknesses in promoting productive bank intermediation that finance the real economy and economic growth, leading to poverty reduction via growth of employment whilst stimulating financialization within the economy; and finally, the exclusive focus on prudential regulation, whilst ignoring regulatory costs, consumer protection and competition regulation.

The Poverty Reduction Strategy Paper of Honduras and the Transformations of Neoliberalism

A decade into the PRSP (Poverty Reduction Strategy Paper) process, this article provides a comprehensive look at the World Bank's development approach and demonstrates that recent changes in development policy have resulted in the emergence of a more inclusively oriented neoliberal development regime. In doing so, the article traces the important “discontinuities within continuity” between structural adjustment policies (SAPs) and PRSPs, and excavates the transformative elements of the Post-Washington Consensus (PWC) and its most visible policy tool, the PRSP. In an attempt to make sense of this discontinuity within continuity, the article draws on and conceptually develops the notion of inclusive neoliberalism, and uses a case study of Honduras’ experience with the PRSP process to empirically substantiate the claims surrounding the transformations of neoliberalism. Inclusive neoliberalism arguably represents a new phase of more socially interventionist and ameliorative forms of neoliberal governance that selectively combine little-modified macroeconomic policies with more interventionist and expansive social policies to attenuate the social impacts of neoliberal reforms and prop up failing market mechanisms.

Governance and Development: changing EU policies

This introductory article to the special issue on European Union, development policies and governance discusses how notions of (‘good’) governance have come to dominate development discourses and policies since the mid-1990s. The article argues that governance was part of the so-called Post-Washington Consensus, which understands governance reform as part of the creation of market societies. Although academics have commonly emphasised the fact that governance concerns the rules that regulate the public sphere, the dominant understanding of (good) governance in policy circles revolves around technical and managerial connotations. The second part of the article introduces some important features of EU development policy, and argues that this is essentially neoliberal in nature and favours a technocratic approach to governance reform. The EU's main instrument in relations with developing countries is the Country Strategy Paper, which includes a set of governance indicators for the assessment of the political situation in partner countries. In addition, the European Union has developed a ‘governance profile’, which consists of nine components.

Quo vadis neoliberalism? The remaking of global capitalist governance after the Washington Consensus

The Washington Consensus, through which neoliberal global capitalist governance gained hegemony over the third world, entered a crisis in the late 1990s. Triggered by the 1997 Asian financial crisis, and by contestations of neoliberal governance from global civil society, two remakings of global capitalist governance can be identified: A ‘post-Washington consensus’ whose relation to neoliberalism is complex; and a ‘new development economics’ that advocates Keynesian principles. Irrespective of the trajectory of this emergent phase of re-regulation, particularly after the 2008 global finance crisis, these remakings can be conceptualized as supplements reinforcing an imaginary of capitalism as the solution to, rather than progenitor of, uneven development. Through discourses of capitalist development as a sequential trajectory to be followed by all countries, as flattening the world to enable catch-up by backward countries, and as incorporating socio-spatial difference via its commodification, this socio-spatial imaginary functions to legitimate expertise located in the first world, and global capitalist governance, irrespective of serial policy failures.

Selectivity at Work: Country Policy and Institutional Assessments at the World Bank

The World Bank (WB) has been at the forefront of a redefinition of conditionality since the late 1990s, away from finance in return for the promise of policy reform, as was typical under structural adjustment, towards the disbursement of funds conditional on what has already been achieved. Under ‘selectivity’ or performance-based aid, aid allocations are rationed on the basis of deviation from an ideal country model, captured in the country policy and institutional assessment (CPIA). This article seeks to situate the emergence of the selectivity practice, and undertakes a close review of the CPIA, the mechanism at the heart of performance-based aid. This is set against the backdrop of the transition from Washington to post-Washington consensus. The CPIA emerges as a prism through which we can observe crucial features of how the WB’s relationship with poor countries is regulated. This reveals the persistence of a set of imperatives in the WB operational practices, often at variance with the WB rhetoric that has sought to move beyond the neo-liberal bias characteristic of the WB conditionality of the 1980s and early 1990s.

Discipline in the global economy?: international finance and the end of liberalism

1. Introduction Part I: The Asian Crisis 2. Toward a Problematization of The Asian Crisis 3. Understanding Asia's Crisis 4. What Happened to Asia? 5. The East Asia Crisis - How IMF Policies Brought the World to the Verge of a Global Meltdown 6. The Asian Debt- and Development Crisis of 1997-?: Causes and Consequences 7. Two To Tango? Part II: Discipline in the Global Economy 8. Strengthening the International Financial Architecture 9. Michel Foucault's Analysis of Disciplinary Power 10. Disciplining Economies 11. So What is 'Proper' Economy? 12. More Heat Than Light - Anatomy of a Regulatory Failure 13. The Post-Washington Consensus Part III: The End of Liberalism? 14. What is Liberalism? 15. Liberalism - The Invention of 'The Economy' 16. Neoliberalism - Governing Through Markets 17. So is it the End of Liberalism? Part IV: A Way Forward 18. A New Regulation of International Finance

Privatisation as State Advance: Private Indirect Government in Vietnam

This article considers the significance of privatisation for the changing nature of state power through a case study of Vietnam. In particular, it is concerned with what privatisation – or equitisa...

Social Forces and the Effects of (Post)-Washington Consensus Policy in Africa: Comparing Tunisia and South Africa

This article addresses the consequences of Washington Consensus and more recently post-Washington Consensus policy for democratic good governance in Africa. It acknowledges the increased focus in recent years of policy-makers on poverty as an important force in world politics. Despite this increased concern the authors argue that International Relations as a discipline fails to offer a suitable framework for understanding poverty as a social force. The article proposes a revival of Robert W. Cox and Jeffrey Harrod's approach based on ‘patterns of social relations of production’. This offers a disaggregation of the condition that is often referred to in the literature as ‘the poor’ or ‘the informal sector’. The article then outlines a comparative research agenda based on the cases of Tunisia and South Africa. It demonstrates how these cases provide the sternest test for assessing the authors' scepticism of the prospects of reconciling market-led development with good governance, whilst also offering a ‘most-different’ comparison given their very different political cultures. In conclusion, the article reflects on the methodological aspects to operationalising such a research agenda and proposes an ethnographic approach informed by the work of Burawoy.

‘Social Development’ as Neoliberal Trojan Horse: The World Bank and the Kecamatan Development Program in Indonesia

ABSTRACTThis article seeks to reconceptualize the post‐Washington consensus (PWC) by focusing not simply upon the institutional structures and ideology promoted by it, but the manner in which these are promoted on the ground. The aim is to reveal a central distinction between the Washington consensus and the PWC that has been somewhat neglected: their diverging approaches to implementation. The author focuses on the World Bank‐funded Kecamatan Development Program (KDP) in Indonesia, a project that is viewed by some as being somewhat unorthodox. He argues that in addition to its promotion of the latest round of institutional reforms, what is really different about KDP, compared with older approaches to market‐led development typical of the Washington consensus, is the manner in which it delivers its mix of neoliberalism. What is radical about a programme like KDP is that it constitutes a new Trojan horse for embedding market‐centred norms and practices.1 In general, this is demonstrative of a key difference between the Washington consensus and the PWC that has been undervalued in many analyses of the dominant development paradigm: the methods used to embed and sustain liberal markets.

Holding it Together in a Crisis: Family Strengthening and Embedding Neoliberalism

This article seeks to intervene in debates about the role of crisis in Post-Washington Consensus (PWC) policymaking. Gender and sexuality are largely absent from that debate. What do experiences of crisis reveal about the inter-connections between crisis, gender, and sexuality? In concrete crisis conditions, which common sense groundworks of the present (Nikolas Rose) get unsettled, which get reentrenched, and what is the role of the development industry in this process? Using policy texts, interviews with World Bank policymakers, and fieldwork on a family strengthening loan in Argentina, the author argues that denaturalisation of free markets in the PWC is articulated partly through the renaturalisation of monogamous heterosexual couplehood. With the injuries of neoliberalism framed as injuries to loving couplehood, the World Bank and its allies resolve to (re)generate intimate partnership as the defining feature of the post-crisis era, raising crucial questions about new regimes of heteronormativity under construction in contemporary development practice.

The Evolution of the Anti-Washington Consensus Debate: From ‘Post-Washington Consensus’ to ‘After the Washington Consensus’

The term ‘Washington Consensus’, as Williamson the father of the term conceived it, in 1989, was a set of reforms for economic development that he judged ‘Washington’ could agree were required in Latin America. However, the Washington Consensus has been identified as a neoliberal manifesto and as a consequence an anti-Washington Consensus was initiated, as calls were made for the establishment of a different set of policies, such as the ‘Post-Washington Consensus’, ‘Washington Contentious’ and ‘After Neoliberalism’. Lately, even Williamson has come up with a new set of policies, ‘After the Washington Consensus’. The aim of this paper is to investigate the different interpretations and alternatives of this controversial set of policies, and to reveal that the evolution of the debate conceptualizes the evolution of economic thought regarding the required policies for economic development.

Assessing the New Washington Pluralism from the Perspective of the Malaysian Model

This paper discusses the post-Washington Consensus development paradigm, questioning whether the changes it embodies are sufficient to open up the development debate. We show that the new paradigm, which might be called ‘Washington Pluralism’, harbours three pluralist principles. It maintains that development is 1) contingent on culture; 2) contingent on history; and 3) requiring a multidisciplinary perspective. We assess these principles on the basis of an analogy with the Malaysian Model, which embodied the same three principles. We show that, in Malaysia, the first two evolved into cultural determinism and historicism, respectively, while the third created a discourse in which institutions, politics and culture were reduced to instruments for development. Consequentially the proliferation of the idea of a Malaysian Model has been associated with increasing authoritarianism in Malaysia rather than with increased openness. On the basis of this analogy we conclude that the three pluralist principles are not sufficient to create an open development debate.

Neoliberal Law: unintended consequences of market-friendly law reforms

This paper offers a critical evaluation of the interrelation of law and economics in the context of development. The paper describes the current promotion of law reform by international institutions like the World Bank as the product of neoliberal economic theory. The analysis examines the role of law historically as an expression of economic orthodoxy, arguing that the Washington Consensus has determined the shape of law reforms, pointing them to the definition and protection of private property rights, aiming to separate politics from economics. The relative failure of these policies in their application to countries emerging from communism led to the expansion of the reform agenda to include market-supporting institutions, among them the rule of law. The paper assesses the extent to which this expansion means that the role of the law and the relationship of regulation to market have changed sufficiently to denote a Post-Washington Consensus. It concludes that the use of law reform to impose what neoliberalism considers ‘rational’ solutions undermines the legitimacy of democratic institutions in developing and transitional countries.

Institutional framework and typology of economic transition in post-communist countries of Central and Eastern Europe: the role of Bretton Woods institutions

Departing from the concept of transformation and transition, this article highlights some main directions and problem areas of this process. It starts with description of transitory architecture in countries of Central and Eastern Europe based mostly on the concept of “Washington consensus” as the main method being used during the first stages of transition in many post-communist countries. Firstly we start with description of “Washington consensus” and its application in different countries in transition – from Latin America to the region of post-communist countries. After this theoretical part we start with concrete examples from particular countries where the key transitional processes will be described. Main focus will be put on the privatisation process in the Czech Republic in comparison to other post-communist countries. Typology of transitory processes in particular countries from “shock therapy” to “gradualist” ones will be placed. Than alternative approaches to transition will be introduced, focusing on the concept of path dependency, network analysis, regulation theory and their approaches to state socialism and post-communist transformations. Summarisation of main findings and the counterbalance to neo-liberal approach will be discussed. Is there some “post-Washington consensus” which has learnt from previous mistakes?

No ‘return to the state’: dependency and developmentalism against neo-liberalism

In the emerging ‘post-Washington Consensus’ era, neo-liberalism is searching for alternatives that once again emphasise the state. Yet neither Latin American dependencia nor East Asian developmentalism – two development models actually practised ‘on the ground’ – shares the basic assumptions of the liberal, rationalist state. First, there persists a significant ontological divide over the purpose of the state. Developmentalists and dependentists advocate deep, dynamic state agency rather than the hands-off, liberal, ‘night-watchman’ state. Second, development theory has unfolded within a modern liberal framework of science, democracy, the interests of US foreign policy, and increasingly a commitment to poverty alleviation. Dependency and developmentalism reject these neo-liberal benchmarks in the interests of state consolidation and autonomy. The persistence of dependentist and developmentalist understandings of the state precludes a uniform, post-neoliberal reversal in development theory back to the state.

(Re-)building governance in post-conflict Africa: the role of the state and informal institutions

Post-conflict governance is an increasingly important aspect of foreign development assistance in sub-Saharan Africa (SSA), where the weakening and disintegration of the state undermine sustainable human development. A major challenge in post-conflict rebuilding in SSA concerns the incorporation of subnational non-state structures and informal institutions into the post-conflict governance apparatus. In order to tackle this apparent gap in sustainable peacebuilding, more theoretical and empirical research is needed into the nuanced role(s) and contribution(s) of the post-conflict state in reconstituting governance and rehabilitating communities. This article discusses the post-Washington Consensus (PWC), an emerging development approach which seeks to re-introduce the role of the state in development and post-conflict studies. The central proposition of the article is that, contrary to the anti-statist premise of the Washington Consensus, states, non-state structures, and informal institutions play an important role in cultivating institutional reconciliation, interpenetration, and integration between macro-level government structures and subnational social institutions.