Economic Restructuring, Coping Strategies and Social Change: Implications for Institutional Development in Africa

Since the early 1980s, most African countries have experienced unsatisfactory rates of economic growth and profound changes in livelihood systems, which have affected the way their modern institutions function. However, when confronted with evidence of poor economic performance in countries undergoing adjustment, the international financial institutions often blame governments for their lack of political will in regulating the activities of bureaucrats and vested interests. They recommend policies aimed at restructuring public sector institutions through privatization, public expenditure cuts, retrenchment, new structures of incentives and decentralization. Despite efforts to implement these measures in a number of countries, the problems of low institutional capacity remain. Two key contradictions appear to explain why institutions have been largely ineffective in crisis economies in Africa: the growing contradiction between the interests of bureaucratic actors and the goals they are supposed to uphold; and the contradiction between the institutional set‐up itself and what goes on in the wider society. To understand how these contradictions work, it is necessary to look more closely at the set of values and relationships that anchor institutions on social systems. The issues here are social compromise and cohesion; institutional socialization and loyalties; overarching sets of values; and political authority to enforce rules and regulations. The crises in these four areas of social relations, which are linked to the ways households and groups have coped with recession and restructuring, have altered Africa's state institutions so that it has become difficult to carry out meaningful development programmes and public sector reforms without addressing the social relations themselves.