Thursday, June 3, 2010

State vs Government

John Wallis gave a talk yesterday on a paper he's working on with Doug North about the difference between the state and government. The basic argument is that we should look at the state as the organization that organizes other organizations. The government is an organization that is part of the state, and to the extent that the government is the state, we observe strong governments and less tendency for civil wars and suchlike. One of the upshots of this is that hidden organizations within a state can hinder development efforts. This is a hell of a challenge for people interested in eradicating poverty. If there isn't one organization that subsumes the power to use violence, then both identifying and appeasing all interested, powerful parties can be prohibitively expensive.

I'm not sure how to feel about all this. I like the idea of clearly defining the difference between the state and the government, but I'm leery of the sort of reaction that this might generate in the development community. It's a good justification for bringing warlords into the fold, as well as working on making governments more transparent, so it could either lend legitimate authority to tinpot dictators or work towards establishing sound governance. Eh, whatever. I actually suspect that IMF and World Bank won't much care anyway. Too much bureaucratic inertia to change policy anyway.

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