IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

The indirect approach

Listed author(s):
  • Ellerman, David
Registered author(s):

    Aid and conditionalities are the"carrots and sticks"of the conventional, direct approach to fostering economic development. The economic theory of agency is the most sophisticated treatment of the direct carrots-and-sticks approach to influencing human behavior. Considering the outcomes of the conventional approach, it might be worthwhile to explore alternative indirect approaches that focus on enabling clients to act more autonomously, rather than try for fuller control of clients'actions (or"agents"behaviors) with improved carrots and sticks. Are there inherent limitations in the direct approach that will not be addressed with better crafted"agency contracts"or closer monitoring of the agents? The author traces the intellectual history of indirect approaches from Socrates to modern thinkers, such as Wittgenstein, Gandhi, and McGregor. One theme of his survey is that constructivist and active-learning pedagogies constitute an indirect approach in which the teacher does not directly transmit knowledge to the learner, through training, and instruction. These pedagogies - translated into social and economic development as learning writ large - from the basis for an alternative indirect approach to fostering development. Actions have motives, just as beliefs have grounds, concludes the author. In the wide spectrum of human endeavor, there is only a fairly small"bandwidth"in which motives can be supplied by the carrots, and sticks of the direct approach (including agency theory, and market-driven activities as special cases of the direct approach to affecting behavior). Outside that spectrum, trying to use direct methods in a controlling manner, contradicts the motives for actions (and the grounds for beliefs) - like trying to"buy love."For higher activities, motives must come from within. Helpers can at best use an indirect approach to bring doers to the threshold; the doers have to do the rest, which makes the results their own.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL:
    Download Restriction: no

    Paper provided by The World Bank in its series Policy Research Working Paper Series with number 2417.

    in new window

    Date of creation: 31 Aug 2000
    Handle: RePEc:wbk:wbrwps:2417
    Contact details of provider: Postal:
    1818 H Street, N.W., Washington, DC 20433

    Phone: (202) 477-1234
    Web page:

    More information through EDIRC

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    in new window

    1. Joseph E. Stiglitz, 1974. "Incentives and Risk Sharing in Sharecropping," Review of Economic Studies, Oxford University Press, vol. 41(2), pages 219-255.
    2. Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 7-63, March.
    3. Ross, Stephen A, 1973. "The Economic Theory of Agency: The Principal's Problem," American Economic Review, American Economic Association, vol. 63(2), pages 134-139, May.
    4. Kreps, David M, 1997. "Intrinsic Motivation and Extrinsic Incentives," American Economic Review, American Economic Association, vol. 87(2), pages 359-364, May.
    5. Akerlof,George A., 1984. "An Economic Theorist's Book of Tales," Cambridge Books, Cambridge University Press, number 9780521269339, May.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:2417. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.