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Developmental States in the New Millennium:
Concepts and challenges for a new aid agenda

Verena Fritz and Alina Rocha Menocal1

Overseas Development Institute (ODI)


SARPN acknowledges ODI as a source of this document:
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Two decades on from the recognition of good governance as one of the keys to development and poverty reduction, the developmental state is back at the centre of the international policy debate. Policy thinking shows an increasing willingness to abandon value-laden prescriptions about governance and to adopt approaches rooted in comparative history and evidence-based analytical theory. The concept of the developmental state serves as a marker of this trend. Although the language was hardly new even in the 1980s when the first flood of studies of East Asian industrialisation brought it into currency, the idea of the developmental state has enduring value as an anchor for discussions among researchers and policy-makers on how to bring evidence from history to bear on today’s policy challenges.

The focus of these exchanges is how states can become more capable and more supportive of development and human security. The emphasis has shifted from determining the ‘right’ role for the state – a vital question in the 1990s (World Bank, 1997) – to questions about commitment and capacity. The immediate sources of this shift are clear enough. As the Commission for Africa acknowledged in its 2005 report, the way states function is increasingly seen as one of the most important factors affecting development in the poorest countries. At the same time, collapsed and fragile states imperil international peace and security, posing enormous challenges to current models of development co-operation. These observations provide a practical incentive to revisit what is known about state-building and the development of state capacity. Underlying the new interest, however, is a growing sense that the tools currently available to policy-makers interested in governance for economic, political and social development as well as security are not good enough. There is a need to return to the sources.

The sources are not insignificant. There are rich academic literatures on the role of the state in the development of the countries of East and South-East Asia; on the neopatrimonial or patronage-based states that prevail in much of the rest of the developing world, especially in Africa; and on failed and fragile states. However, their relevance to today’s policy concerns has never been entirely clear. Relatively few attempts have been made to use them as building blocks for policy reflection, or to spell out how they might better inform current policies for developing countries. This theme issue is a contribution to filling this gap.2

A key premise of the collection is that states – and their political economies – matter for social and economic development. We follow the definition provided by Chesterman et al. (2005: 2) of the state as ‘an abstract yet powerful notion that embraces a network of authoritative institutions that make and enforce top-level decisions throughout a territorially defined political entity’. This definition incorporates Mann’s (1986) interest in the infrastructural power that enables the state to penetrate society and implement decisions, adding to the minimalist definition classically advanced by Max Weber, which focuses on (legitimate) control over territory. A defining characteristic of the ‘modern’ state in this tradition is that political power becomes progressively depersonalised and formalised. A central question in discussion of developmental states is how much and by what means prevailing governance systems need to change in the direction of so-called modern state forms in order to be effective in delivering development and security.

Among the contributions to this volume, there is general agreement that better and more effective states are needed if development is to succeed in the world’s poorest countries. The disagreements focus on what exactly that entails, how the challenges are to be met and what the contribution of international actors and policies might be. Three issues are of particular concern. They are addressed in turn in this overview article.

One is the relationship between the project of building or rebuilding effective states and the ‘good governance’ agenda, including democracy and democratisation. After some further elaboration of the concept of the developmental state and why we believe it is worth revisiting, we explore some of the complexities of this relationship, including a discussion of the perennial question of whether developmental states have greater affinities with authoritarian or democratic political regimes. We argue that the developmental state agenda is both less and more demanding than the good governance agenda.

A second issue is the role of external actors. International thinking on states in developing countries has evolved in recent years, and it could be said to have become more friendly to efforts to build developmental states than even a few years ago. However, it is far from clear that on balance the international development business is a positive influence on state-building, or that aid donors in general know how to contribute to it in useful ways. We look at the shifting donor thinking on the role of the state, and assess current efforts at making the aid system more effective in supporting key aspects of state construction under the banner of the Paris Declaration.

The third issue is the way forward. We take the view that a new interpretation of the developmental state (in particular one that takes into account the various contextual factors that encourage or impede its emergence and evolution) could serve as a powerful vision for reconfiguring current development and aid policies. Within this context, more emphasis may need to be placed on the political character of state-building, and the impossibility of approaching it with merely technocratic tools. The political system and its political-economy underpinnings are crucial in shaping commitment to development, as well as the reformist capabilities that are required to make change happen.

The contributions to this theme issue point to many difficult challenges. While developmental states are desirable, they are impossible to ‘manufacture’ and not susceptible to any of the more obvious forms of promotion. Domestic political-economy factors – neopatrimonial structures, clientelism and populism – as well as external influences – from fragmented aid to bribery by foreign companies – militate against their emergence in today’s developing countries. Nonetheless, developmental states have emerged, in the recent as well as the more distant past, in different places and under various circumstances. The lessons of these experiences need to be learnt before we reach firm conclusions on where and how developmental states may emerge in the new millennium.

  1. Research Fellows, Poverty and Public Policy Group, Overseas Development Institute, 111 Westminster Bridge Road, London SE1 7JD ( and ).
  2. Most of the contributions were first presented at an ODI meeting series convened and organised by the issue editors in 2006 under the title ‘(Re-)building developmental states: from theory to practice’, details of which can be accessed at Both the meeting series and the preparation of this theme issue were supported by DFID. The views expressed here are, however, those of the authors and are not to be attributed to DFID.

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