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Key Text The Role of Scholars and Scholarship in Economic Development

Author: Mary Shirley
Date: 2008
Size: 37 pages (2.7 MB)

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Summary

What is the role of scholars and scholarship in institutional change? How do shared beliefs shift so that self-enforcing and persistent institutions change radically? This chapter from Institutions and Development, published by Edward Elgar, argues that the impetus for changing institutions must come from within a society. When leaders believe that their present policies cannot cope with an economic shock or an external threat, local scholars can act as institutional entrepreneurs by devising and disseminating a new conceptual model of how the world works and a related set of policy reforms. Under the right circumstances the initial reforms institute a persistent and gradual transformation of institutions.

Institutions are self-enforcing: no one with the power to change them has any incentive to do so. Radical institutional change is rare not only because powerful people oppose it, but also because it requires new organisational forms and a fundamental shift in shared beliefs and values.

The European Enlightenment gave birth to ideas that challenged dominant paradigms and led to the emergence of new norms and beliefs about the world. Such profound intellectual transformations occur rarely today. One reason for this is the current marketplace for ideas, which tends not to reward radical scholarship. Scholars from developing countries are also constrained by a lack of funding and incentives for good research, poor dissemination of research findings, discouragement of non-conformist thinking, and brain drain.

Local scholars can stimulate radical institutional change by proposing a new policy programme based on a coherent economic paradigm, but only under the right circumstances. The circumstances that allow scholars to influence change include:

Ruling elites who believe that radical change is necessary because of an external threat or economic shock, and further believe that previous reforms have failed to provide a solution, and
A scholarly vision that elites consider to be viable, feasible, and the consensus of a group of credible experts.
In addition, the scholars have media or other channels to communicate their alternative vision to the elites; they diffuse the vision beyond the elite to relevant interest groups; the initial changes are seen as successful, and the reforms create new beneficiaries who support further change.

Despite the difficulties in testing these hypotheses, some support can be found in six case studies (Taiwan, South Korea, Chile, China, Indonesia and Argentina).

In all six countries, external threats or economic shocks created an opening for new policy ideas, and a group of local scholars advocated a new economic paradigm that was different from previous models and perceived to be viable.
New policies based on scholarly paradigms created freer and more competitive markets.
In two cases, policy changes did not culminate in a sustained process of institutional change. Elites failed to implement specific reform proposals in Indonesia and failed to address underlying institutional failures in Argentina.
Scholars played an important role in stimulating changes that led to the gradual transformation of institutions in Taiwan, South Korea, Chile and China, although the extent of transformation varies.

Institutional transformation is a long and gradual process, making it difficult to identify the contribution of scholars in instigating change. Further research is needed to gain a better understanding of the contribution of scholars in instigating institutional change and on the role of scholarship more generally in transforming beliefs in contemporary society.

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Source: Shirley M., 2008, 'The Role of Scholars and Scholarship in Economic Development', in ‘Institutions and Development: Advances in New Institutional Analysis’, Edward Elgar Publishing Ltd, Cheltenham, UK
Organisation: Edward Elgar Publishing, http://www.e-elgar.co.uk/