Political drivers Notes

What Are Political Drivers of Development?

1. Political conditions shape how resources are collected, how decisions are made, and whether people and firms feel safe enough to plan for the future.
2. These factors are often called political drivers because they can:
   1. Accelerate development (rising standards of living)
   2. Hold it back, even when a country has valuable natural resources or a large workforce.

How Do Political Drivers Determine Whether Development Policies Work?

1. A key political idea in development is economic stability.
   1. When the political environment is unstable (frequent unrest, unpredictable rules, weak enforcement), it affects everyday economic decisions.
   2. Businesses may avoid long-term investment, and banks may lend less.

How Do Stability and Rule of Law Encourage Investment and Productivity?

1. A major political driver is political stability, meaning a country has predictable leadership transitions, low levels of violence, and consistent policies.
   1. Stability supports development because it reduces risk.
2. When stability is missing, entrepreneurs (people who start and run businesses) may decide it is too risky to invest.
   1. A business relies on predictable demand, secure property, and confidence that rules will not suddenly change.
3. Stability also supports the financial sector.
   1. Banks are central to development because they provide startup and investment capital.
   2. If banks are small or fragile, or if there is no strong legal framework to handle economic difficulty (for example, clear bankruptcy rules and credible regulation), lending becomes limited. With less lending:
      1. fewer firms expand
      2. fewer jobs are created
      3. productivity growth tends to be slower

How Does Corruption Divert Resources Away from Public Benefit?

1. In practical terms, corruption can mean that:
   1. taxpayer money is not spent where it helps the most
   2. contracts go to less efficient firms, raising costs and reducing quality
   3. people lose trust in government, weakening compliance with taxes and laws
   4. Corruption also discourages investment.
      1. If firms believe they must pay bribes or that contracts are not enforced fairly, they may invest less or operate informally, which reduces tax revenue further.

What Are Examples Of Democracy, Accountability, and Alternatives in Practice?

1. Many governments operate as democracies, where adults choose representatives.
   1. Democracies are often seen as relatively stable because leaders are accountable to voters and can be removed if citizens judge them unsuccessful.
2. Accountability can support development by creating incentives to deliver public goods and services, reduce corruption, and respond to citizens' needs.
   1. It can also increase policy legitimacy, which can improve cooperation (for example, people paying taxes or following public health advice).
3. However, the relationship between democracy and development is not simple.
   1. Some single-party states have achieved strong economic growth and progress toward development goals. This challenges the claim that democracy is the only pathway to development.
   2. A more balanced conclusion is that development depends less on one political label and more on whether the system delivers:
      1. predictable rules
      2. effective public administration
      3. credible enforcement of laws
      4. long-term planning capacity

How Does State Capacity Enable Education, Healthcare, and Infrastructure?

1. Even with good intentions, governments need state capacity, the ability to design and implement policy effectively.
2. This matters especially for services that markets alone tend not to provide fairly.

Education and healthcare often require government intervention

1. Education and healthcare are widely treated as areas where government intervention is necessary.
   1. A purely market-based education system sets a price.
      1. Some children will not attend school because their families cannot pay, even though education benefits society.
   2. Healthcare has broad social benefits because healthier people can work, pay taxes, and reduce the spread of disease.
      1. Private healthcare alone is unlikely to ensure sufficient access for the whole population.

Infrastructure depends on political choices and funding

1. Infrastructure can be privately built if firms can charge users and demand is high enough.
2. But in many developing countries, demand may be low at first (for example, building mobile phone towers where few people own phones).
3. Governments often step in, using tax revenue to fund infrastructure, but this is a major hurdle when tax collection is weak or corruption is high.

How Do Political Drivers Shape Migration, Social Tensions, and Dependency Ratios?

1. Migration can create political debate when economic conditions worsen.
   1. For example, when unemployment rises in a destination country, tensions can increase if locals believe migrants are taking jobs.
   2. At the same time, migration can increase cultural diversity and skills (for instance, greater language learning in schools).
2. For the country of origin, migration can bring benefits through remittances (money sent home).
   1. But if many young working-age people leave, the origin country may face a higher dependency ratio, with more elderly people relative to the workforce.
   2. This can weaken tax revenues and increase pressure on public spending.

How Do Political Drivers Influence Health Outcomes Through Public Policy?

1. Politics affects health directly through funding, planning, and stigma reduction campaigns.
2. The global spread and treatment of HIV/AIDS shows how political and social contexts shape development.
   1. Factors influencing HIV/AIDS spread and treatment include:
   2. public understanding of how the disease is transmitted
   3. stigma attached to diagnosis
   4. beliefs and norms that influence use of family planning and birth control
   5. availability and affordability of medical care, including antiretroviral drugs
3. Even when effective medication exists, outcomes differ depending on whether governments can deliver healthcare reliably, educate the public, and reduce stigma.

Why Do Market-Based and Interventionist Policies Depend on Political Context?

1. Development strategies are often grouped into:
   1. market-based policies (greater reliance on private markets, prices, and competition)
   2. interventionist policies (greater state involvement through spending, regulation, and direct provision)
2. In practice, most countries use a mix. Political drivers influence which mix is feasible.
   1. If governance is strong and corruption is controlled, interventionist policies (like building infrastructure, expanding education, and public healthcare) are more likely to deliver benefits.
   2. If governance is weak, large public budgets can be captured by corruption, and market-based approaches may appear more attractive, though markets may still fail to reach the poorest.
3. The key idea is not "state versus market" as a slogan, but whether institutions can make either approach work.