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Discusses various modes of entrepreneurship and their contributions to economic development. Concept of I.M. Kirzner of entrepreneurship; Explanation on routine entrepreneurship; Elaboration on Schumpeterian entrepreneurship.

Presents a study which stressed the importance of institutions, political stability and inequality of income in determining economic growth via their influence on the nature and quality of government policies. Relationship between economic growth and government variables; Method; Results; Conclusions.

Focuses on the lessons of the East Asian crisis for financial sector regulation particularly in the context of developing economies. Role of the financial system in the development process and the functions it performs in facilitating efficient resource use and economic growth; Causes of financial distress; Failures in prudential regulation and supervision in East Asia.

Despite the fashion for pro-poor growth, there remains no consensus as to its meaning. This article proposes three possible definitions, and examines the pattern of growth over time and in different world regions. The growth of the poor's income can be broken down into a growth effect and a distribution effect. In 143 growth episodes, it is found that the growth effect dominates. However, in over a quarter of cases changes in distribution played a stronger role than overall growth in increasing income for the poor. Econometric analysis of growth regressions for each population quintile supports the idea that openness benefits everyone, but indicates a robust perverse relationship with governance. There is also evidence of a trade-off between growth and distribution, suggesting that attention to distribution will be better for the poor than going for growth. [ABSTRACT FROM AUTHOR]

Despite being a relatively modest document that commits the government to little that is new, the PRSP is quite a significant innovation in the context of Tanzania. The PRSP approach has brought poverty reduction policy into line with the fiscal framework, promoted a more participatory approach to public policy–making and helped the government to adopt a policy of eliminating primary school fees. However, this article argues, the difference that this makes can be overstated. Much depends on the completion of complementary reforms in the management of the public services and local government. Expectations about the PRSP process therefore need to be carefully managed, keeping firmly in mind that commitment to poverty reduction is a political and not a technocratic issue. [ABSTRACT FROM AUTHOR]

To explore factors underlying growth and poverty reduction in Africa while overcoming some of the limitations of cross-country analysis, this article uses micro-level survey and panel-data evidence from Uganda spanning 1992–2000. The high elasticity of both income growth and poverty reduction with respect to agricultural output (coffee) prices confirms the benefits from Uganda's decisive liberalisation of output markets. It also suggests the importance of product diversification to protect the poor against price shocks and the potential of cotton-market improvements in tackling persistent poverty in the North. The importance of improving access to basic education and health care emerges more clearly than in cross-country analysis, but benefits depend on complementary investments in electricity and other infrastructure, and reductions in civil strife. [ABSTRACT FROM AUTHOR]

This article analyses the possible links between economic growth, poverty and health, using panel data for the Indian states. The findings indicate that, though growth tends to reduce poverty, significant improvements in health status are also necessary for poverty to decrease. Also, economic growth and health status are positively correlated and have a two-way relationship, suggesting that better health enhances growth by improving productivity, and higher growth allows better human capital formation. Health expenditure is an important determinant of both higher growth and better health status, and is therefore a key tool available to policy-makers. Among other exogenous variables, literacy and industrialisation seem to improve both health outcomes and growth, and to reduce poverty. [ABSTRACT FROM AUTHOR]

This article describes the chief findings of research carried out in four African dryland areas to investigate the validity of the authors' ‘Machakos hypothesis’, and to derive lessons on appropriate enabling policies. The findings were subsequently submitted to in-country validation and dissemination exercises. The lessons learnt from these in regard to introducing research findings into country policy dialogues are set against the background of current discussion of this issue. The article also discusses uptake at the international level, because it tends to be at this level that development paradigms and practices are formulated and promoted into countries through donor and agency actions. [ABSTRACT FROM AUTHOR]

When international development policy prioritises goals determined by the donor's domestic policy concerns, aid agencies not only fail in their development objectives but can also generate conflict in the recipient country. In the Bolivian Chapare, where the United States is driven by the need to demonstrate success in controlling cocaine production, policies to eradicate coca leaf have led to programmes with limited development impact that increase conflict both locally and nationally. In contrast, the European Union's successful collaboration with local governments which began in 1998 provides insights into generating sustainable development and de-escalating conflict in drug-producing regions worldwide. [ABSTRACT FROM AUTHOR]

Until recently, antiretroviral treatment against AIDS was perceived to be beyond the reach of the majority of patients in developing countries. This situation has changed drastically as international funding for AIDS treatment has swelled to several billion dollars a year. What has brought about this change? Analysis of the merit of six arguments often put forward against scaling up AIDS treatment in developing countries makes it clear that the most significant (and perhaps only) real change has been the large reduction in the price of the drugs. Although affordability is obviously a central issue, it is noticeable that most of the remaining arguments continue to be unresolved. This underlines the dangers of proceeding too fast towards treatment goals. [ABSTRACT FROM AUTHOR]

International norms of social, economic and political rights are presented as a means of transforming social relations in developing countries. Yet, when rights norms are introduced into domestic practice, they do not always produce liberal, democratic results. Instead, rights and local practices of clientelism mix. This article examines this political process in rural Peru. Alternatives to clientelism emerge when NGOs and international development agencies forge strategic and selective coalitions between urban middle-class sectors and the rural poor. This calls for an explicit politics of advancing rights by any means necessary: accepting hybrid forms when inevitable, incorporating excluded groups when possible, and striking alliances that displace traditional elites. [ABSTRACT FROM AUTHOR]

Andrew S. Natsios was Administrator of the United States Agency for International Development until January 2006. The US has the largest aid programme in the world but labours under certain constraints, notably a proliferation of Congressionally-imposed budget earmarks. Mr Natsios has been an articulate advocate as well as an outspoken reformer of the US approach to aid. It was appropriate, then, for the All-Party Parliamentary Group on Overseas Development of the Westminster parliament, together with ODI, to invite him to speak in Parliament on 12 October 2005. 1 The present article, a version of that APGOOD speech revised by Mr Natsios since his November resignation, has been judged by DPR Editors to be an important development policy statement worthy of publication. Adrian Hewitt [ABSTRACT FROM AUTHOR]

There is a growing recognition of the threat to international security posed by failed and fragile states, often marred by serious internal conflict that also has the potential of destabilising neighbouring states and providing ungoverned territory that can provide safe haven for terrorists. The inability of their governments to provide basic services is considered a significant contributory factor. Considerable donor efforts have been mobilised in recent years to help with the post-conflict reconstruction of states emerging from failure, and to halt the slide of fragile states towards failure, but with mixed effect. The international community needs to focus much more squarely on strengthening the emerging state and increasing its domestic legitimacy, rather than on promoting democracy. [ABSTRACT FROM AUTHOR]

A series of articles, many of them published in this journal, have charted the rapid spread of supermarkets in developing and middle-income countries and forecast its continuation. In this article, the level of supermarket penetration (share of the retail food market) is modelled quantitatively on a cross-section of 42 countries for which data could be obtained, representing all stages of development. GDP per capita, income distribution, urbanisation, female labour force participation and openness to inward foreign investment are all significant explanators. Projections to 2015 suggest significant but not explosive further penetration; increased openness and GDP growth are the most significant factors. [ABSTRACT FROM AUTHOR]

Governments in developing countries have encouraged private sector investment to meet the growing demand for infrastructure. According to institutional theory, the role of institutions is paramount in private sector development. A longitudinal dataset of 40 developing economies between 1990 and 2000 is used to test empirically how different institutional structures affect private investment in infrastructure, in particular its volume and frequency. The results indicate that property rights and bureaucratic quality play a significant role in promoting private infrastructure investment. Interestingly, they also suggest that countries with higher levels of corruption attract greater private participation in infrastructure. [ABSTRACT FROM AUTHOR]

This article explores the level of liquidity within the banking systems of developing countries and the potential impact on rates of economic growth from prudently redirecting a portion of liquid assets into credit to the private sector. It finds that banks in developing countries are extremely liquid and growth rates per capita might increase substantially in response to heightened lending to the private sector. It then summarises the primary obstacles to this and presents several policy reforms that can augment the level of credit to the private sector in developing countries. [ABSTRACT FROM AUTHOR]

Recent literature on private-sector development emphasises the need to establish a ‘level playing field’ and tends to disregard selective supportive interventions. The most commonly highlighted elements are administrative simplification and effective property rights policies, with business services largely left to private providers - what we call the ‘new minimalist approach’ (NMA). However, the NMA is based on certain unrealistic assumptions and is barely backed by empirical evidence. A range of complementary public policies is needed to create competitive sectors and overcome internal constraints, especially in small-scale economies. [ABSTRACT FROM AUTHOR]

The World Bank's World Development Report 2006 addresses equity and development, defining equity as respect for equal opportunities combined with the avoidance of absolute deprivation. Equity has up to now remained a marginal issue in development economics. This detailed analysis endeavours to place the subject within the context of the evolution of World Bank thinking and policies. The wealth of the concept is illustrated, the downside being the difficulty in defining it accurately. We also emphasise the gap between the prospects opened up by such an enlargement of development goals and the report's policy recommendations, which are generally merely an extension of the World Bank's traditional analyses. [ABSTRACT FROM AUTHOR]

This overview introduces the articles in this theme issue of DPR. Their focus is on how growth can be sustained in the face of a number of challenges, and how it can be made more poverty-reducing. The context against which these issues are examined is dynamic, with rapid change in rural-urban balance, shifts in patterns of regional and global trade and questions about whether existing modes of energy use and environmental management are sustainable. Whether and how new partnerships can be forged - including partnerships between Asian countries and donors - and how they might accelerate poverty reduction in this changing context is a central concern. [ABSTRACT FROM AUTHOR]

This article examines a number of policy challenges and dilemmas arising from the pattern of growth and poverty reduction in Asia, central to which is the fact that growth and poverty reduction have been more rapid in Asia than in any other region in the last decade, and yet Asia still contains the majority of the world's poor. The article examines the record of achievement, possible future trends including emerging patterns of inequality, and likely future priorities for poverty-reduction policies. It assesses the role of official development assistance and suggests how it may evolve in future, in part linked with responses to a number of challenges shared between Asian and OECD countries, including energy supply, environmental issues including climate change, and financial stability. [ABSTRACT FROM AUTHOR]

The extent of poverty reduction in Asia by 2015 will depend upon two linked issues: sustaining the current rates of economic growth and avoiding increases in income inequality. Rapid growth over the past 15 years has itself created three challenges for its continuation: inadequate infrastructure; energy shortages and insecurity; and depletion of natural resources and environmental degradation. The ways in which these problems are addressed will have impacts not only on growth but also on inequality, requiring policy interventions at multiple levels, having implications for governance at multiple levels, and involving the development of new partnerships within the region and beyond. [ABSTRACT FROM AUTHOR]

Growth alone does not guarantee sustained poverty reduction, and it may also create threats to social cohesion that in turn can undermine growth. While development thinking remains dominated by a ‘growth-first’ paradigm, Asian experience helps to moderate this view, illustrating the important role of government policy in creating pro-poor growth, providing public goods and social protection mechanisms, and creating the institutional conditions for more inclusive and equitable development. This article examines the structural transformations which accompany growth, and their implications for appropriate policies to progress towards the MDGs. [ABSTRACT FROM AUTHOR]

This article offers a common framework for addressing Asia's varied human-development challenges by observing that, for the most part, they stem from a systematic failure in the delivery of basic services, especially to poor people, caused by a failure of accountability at different points in the service-delivery chain. It describes various efforts by Asian countries to remedy this situation. While there are some encouraging early results, these efforts have also turned up some new challenges to Asia's human-development problems, three of which - politics, decentralisation, and the role of learning from impact evaluation - are highlighted by the study. [ABSTRACT FROM AUTHOR]

Books reviewed in this article: Eliminating World Poverty: Making Governance Work for the Poor – A White Paper on International Development. By the Secretary of State for International Development [ABSTRACT FROM AUTHOR]

The developmental state is back at the centre of the international policy debate. But policy-makers still have much to learn from the large research-based literature on the subject. In introducing a theme issue of DPR on this subject, this article provides an overview of three central topics: the relationship between the project of building or rebuilding effective states and the ‘good governance’ agenda; the role of the international aid community in stimulating or hindering state-building; and the search for a way forward which incorporates awareness of the variety of successful development models and of the role that aid inevitably plays in the incentive structure of state elites in poor developing countries. [ABSTRACT FROM AUTHOR]

High rent creates contests for its capture that, unless skilfully managed, degrade political institutions and distort the economy, leading to a collapse of growth if unreformed. Mauritania's projected oil stream risks such an outcome because past rent-driven growth has left a legacy of Dutch disease effects, rent-seeking and dependent social capital. This article proposes a dual-track strategy for deploying the oil rent as a politically practical means of managing social tensions and improving the economic outcome. Track one promotes a dynamic market economy in the hitherto neglected rural areas, while track two gradually reforms the rent-driven urban sector, thus postponing confrontation with established rent-seekers while the dynamic sector drives competitive diversification of the economy and builds a pro-reform political constituency. [ABSTRACT FROM AUTHOR]

A debate has recently been initiated by a number of members of the OECD Development Assistance Committee to include security-related items in the definition of Official Development Assistance (ODA). This article looks at the logic of these proposals by means of a brief review of the history of the ODA definition as well as recent debates on the relationship between security and development. It concludes by recommending the creation of a new reporting category, Official Security Assistance, for donor spending on security-related activities which meets the basic ODA criteria. [ABSTRACT FROM AUTHOR]

Thinking on economic policy for development has undergone many shifts in response to the perceived weak results of earlier adjustment reforms. A new donor consensus has emerged based around the central themes of economic growth, good governance and social development. This article examines the logic behind this new aid paradigm, revealing a nuanced story with country circumstances playing a critical role and particular interventions varying in impact. For example, growth does not always lead to gains for the poor that match the national average; public expenditure needs to be targeted to achieve social development, but effective targeting is difficult; governance reform may be critical but there is no simple governance blueprint, and the corruption-growth association need not always be negative. [ABSTRACT FROM AUTHOR]

Within current poverty reduction programmes, focus on the social-welfare millennium development goals is widening to embrace a concern with infrastructural investment, particularly for remote areas. The previously popular assumption that rural disadvantage can be remedied by road-building is resurfacing. Using survey data from Ethiopia, Zambia and Vietnam, this article explores how effective such investment is in addressing mobility and social-service accessibility in rural areas. The findings indicate that, in extremely remote areas, road improvements may catalyse the expansion of social-service provision, as evidenced in Ethiopia. However, given the poor's relative lack of motor vehicles and ability to pay for public transport, they are, by no means, a sufficient condition for enhancing the mobility of the rural poor. [ABSTRACT FROM AUTHOR]

This article examines the consequences of the return to Africa of donors that are not members of the OECD's Development Assistance Committee (DAC). It categorises these donors according to form, content, size and modality of their aid. It finds that their return increases external financial flows, in particular to countries not targeted by DAC donors. Moreover, for some donors like China and India the flows are closely related to other financial flow s such as trade and investment. Furthermore, it finds that the return of non-DAC donors may conflict with plans to harmonise aid and may simultaneously raise transaction costs for recipients. [ABSTRACT FROM AUTHOR]

Five decisions by supermarket operators have important dietary implications: the location of their outlets; the foods they sell; the prices they charge; the promotional strategies they use; and the nutrition-related activities they implement. These decisions influence food accessibility, availability, prices and desirability, which in turn influence the decisions consumers make about food. Based on a comprehensive literature review, this article finds that the dietary implications are both positive – supermarkets can make a more diverse diet available and accessible to more people – and negative – supermarkets can reduce the ability of marginalised populations to purchase a high-quality diet, and encourage the consumption of energy-dense, nutrient-poor highly-processed foods. Overall, the most universally applicable dietary implication is that supermarkets encourage consumers to eat more, whatever the food. [ABSTRACT FROM AUTHOR]

While the recent increase in foreign direct investment (FDI) to African countries is a welcome development, the impact of these resource inflows on economic development remains in doubt. This article argues that a key channel is its effects on domestic factor markets, especially domestic investment, and analyses the two-way linkages between FDI and domestic investment in sub-Saharan Africa. The results suggest, first, that FDI crowds in domestic investment and, secondly, that private investment is a driver of FDI, implying that African countries will gain much from improving the domestic climate. Moreover, there are alternatives to resource endowments as a means of attracting foreign investment to non-resource-rich countries. [ABSTRACT FROM AUTHOR]

Despite extensive economic reforms during the late 1980s/early 1990s, Latin America's saving rates remain low. This article examines the saving behaviour of 18 Latin American countries in the 1976-2000 period and compares it with that of 25 other developing countries. It finds that lower inflation, income growth and increased real interest rates on deposits have not had the expected effects on saving rates in Latin America. Instead, the determinants of saving behaviour appear to differ between the two groups of countries, and saving rates are affected by a degree of inertia. Although more research is needed, this indicates that the focus of the neoliberal economic reforms of the 1980s was misplaced. [ABSTRACT FROM AUTHOR]

After being marginalised in the 1980s, land-reform policies came back to national and international development agendas during the 1990s, resulting in a revival of academic research on the subject. This article reviews the empirical literature on access to land, rural development and public action for evidence on when and how the state should intervene in the allocation of rural land. The review suggests that positive impacts are obtained if, and only if, public actions on the allocation of land are carried out under certain conditions and in a certain way. The article ends by highlighting the need to elaborate empirical models that take into consideration opportunity costs and interactions, and that integrate individual responses with aggregate effects. [ABSTRACT FROM AUTHOR]

Book reviewed in this issue. Our Money, Our Responsibility: A Citizens' Guide to Monitoring Government Expenditures. By V. Ramkumar. World Poverty and Human Rights: Cosmopolitan Responsibilities and Reforms. By Thomas Pogge. Taxation and State-Building in Developing Countries: Capacity and Consent. Edited by Deborah Brautigam, Odd-Helge Fjeldstad and Mick Moore. Ethics of Global Development: Agency, Capability, and Deliberative Democracy. By David A. Crocker. An Introduction to Sustainable Development. By Peter P. Rogers, Kazi F. Jalal and John A. Boyd. The Current Negotiations in the WTO: Options, Opportunities and Risks for Developing Countries. By Bhagirath Lal Das. Commodity Prices and Development. Edited by S. Newton and R. Grynberg. WTO Negotiations on Agriculture and Developing Countries. By Anwarul Hoda and Ashok Gulati. Expanding Frontiers of Global Trade Rules: The Political Economy Dynamics of the International Trading System. By Nitya Nanda. Policy Windows and Livelihood Futures: Prospects for Poverty Reduction in Rural India. Edited by John Farrington, Priya Deshingkar, Craig Johnson and Daniel Start. Indigenous Routes: A Framework for Understanding Indigenous Migration. By Carlos Yescas Trujano. Migration and Remittances Factbook 2008. By the World Bank. Social Protection for the Poor and Poorest: Risk, Needs and Rights. Edited by Armando Barrientos and David Hulme. Growth Divergences: Explaining Differences in Economic Performance. Edited by José Antonio Ocampo, K. S. Jomo and Rob Vos. Sub-Saharan Africa: Forging New Trade Links with Asia. By K. Carey, S. Gupta and U. Jacoby. The Least Developed Countries Report 2008: Growth, Poverty and the Terms of Development Partnership. Prepared by the UNCTAD Secretariat. [ABSTRACT FROM AUTHOR]

This article proposes a dialogue around a conceptualisation of development as involving three complementary processes: ‘hanging in’, ‘stepping up’ and ‘stepping out’. These describe different types and scales of structural change in national and sub-national societies and economies, in different sectors within these economies, and in people's evolving livelihoods. The simplicity and strong theoretical, empirical and experiential content of this make it a powerful framework both for interdisciplinary, inter-sectoral, multi-scale analysis of dynamic development processes, and for structuring dialogue about contested aspirations, assumptions, modalities and constraints among development analysts and stakeholders with different interests and paradigms. [ABSTRACT FROM AUTHOR]

The MDGs are being misappropriated to gain support for a specific development strategy, agenda or argument, mostly being used as a call for more aid or as a Trojan horse for a particular policy framework. As relative benchmarks, they are extremely difficult to meet in countries with low human development. Their misinterpretation as one-size-fits-all targets is leading to excessive Afro-pessimism, begging the question whether Africa is missing the targets or whether the world is missing the point. The global MDG canon is dominated by a money-metric and donor-centric view of development, and is not ready to accept that growing disparities within countries are the main reason why the 2015 targets will be missed. [ABSTRACT FROM AUTHOR]

This article examines how developing countries can use, and enlarge, existing policy space, without opting out of international commitments. It argues that: (i) a meaningful context for policy space must extend beyond trade policy and include macroeconomic and exchange-rate policies that will achieve developmental goals more effectively; (ii) policy space depends not only on international rules but also on the impact of international market conditions and policy decisions taken in other countries on the effectiveness of national policy instruments; and (iii) international integration affects policy space through several factors that pull in opposite directions; whether it increases or reduces policy space differs by country and type of integration. [ABSTRACT FROM AUTHOR]

This article reviews the arguments for promoting private investment in infrastructure as a basis for poverty reduction in developing countries. It describes the experience leading to the development of international ‘facilities’ intended to address impediments to private investment. It then explores three ‘levels’ of literature: that of the facilities themselves, of donor organisations, and of academic authors. At each, it investigates the rationale and causal pathways leading from support for private investment to pro-poor outcomes. It finds there is a possible but not necessary association between private investment, economic growth and poverty reduction, but the causal chain is poorly understood. It proposes the development of such a causal framework. [ABSTRACT FROM AUTHOR]

This article argues that the most efficient way of developing Bangladesh is to encourage more emigration. This argument is made in three steps: (i) proposing that 10% of the population be encouraged to emigrate to member states in the Bangladeshi Aid Consortium; (ii) outlining the anticipated costs; and (iii) describing the anticipated gains, which in the light of any feasible alternative, and when contrasted with the relatively meagre costs, are phenomenal and encouraging. By providing individual Bangladeshis with such an opportunity the hopes of the millions remaining behind are strengthened. [ABSTRACT FROM AUTHOR]

This is the first in an occasional series of DPR Debates, designed to illuminate specific issues of international development policy. Each debate will bring together two well-known researchers or practitioners, giving them the opportunity, over three rounds, to test and challenge each other's ideas. The debates are intended to be robust but accessible, rooted in rigorous research but useful to the wide readership of Development Policy Review. [ABSTRACT FROM AUTHOR]

This article provides new evidence on the effects of recent debt-relief programmes on different macroeconomic indicators in developing countries, focusing on the Heavily Indebted Poor Countries (HIPCs). The relationship between debt relief and institutional change is also investigated to assess whether donors are moving towards ex-post governance conditionality. Results show that debt relief is only weakly associated with subsequent improvements in economic performance but is correlated with increasing domestic debt which undermines the positive achievements in reducing external debt service. There is also evidence that donors are moving towards a more sensible allocation of debt forgiveness, rewarding countries which have better policies and institutions. [ABSTRACT FROM AUTHOR]

Climate change poses the most significant foreseeable threat to the development of humankind. Among the parts of the globe liable to be affected, the developing world is the most vulnerable to climate risks. Introducing a DPR theme issue on how development policy is responding to the increasingly pressured global climate agenda, this article reviews what is being done and still needs to be done, paying particular attention to action on three policy frontiers: (i) adaptation actions and finance, (ii) mitigation policies and their governance, and (iii) the implications for development planning. It addresses what will be needed for the development community to rise to the challenge in the run-up to the Copenhagen conference in 2009 and beyond. [ABSTRACT FROM AUTHOR]

The formal financial mechanisms for managing adaptation to climate change under the UN Framework Convention on Climate Change (UNFCCC) are falling significantly short of meeting needs in the most vulnerable countries. Given the close relationship between development and adaptation, it is tempting to use existing channels of development assistance to fill this gap. However, it is imperative that development assistance is not seen as a substitute for specific adaptation finance. This article therefore attempts to distinguish between the two roles, and considers how development assistance might support and complement adaptation funding and action under the Convention, rather than competing with or substituting it. [ABSTRACT FROM AUTHOR]

This article constructs a framework for understanding and explaining the governance of clean development (CD) in order to generate insights about who is governing it, by what means, for whom and how effectively. Such a framework usefully highlights governance gaps and blind spots, issues of policy coherence and co-ordination, and the distributional consequences of existing patterns of CD governance. It points to the need to construct forms of governance whch are mutually reinforcing, which avoid duplication and which provide incentives to address the energy needs of the very poorest, whose interests may otherwise be overlooked. [ABSTRACT FROM AUTHOR]

Climate change poses a challenge to the dominant development paradigm with its concepts of modernisation, economic growth and globalisation which treat the environment as an externality and largely ignore climate variability. This article explores the extent of the challenge, drawing on archaeological evidence showing that adaptation to severe climate change can involve much more radical changes in human societies than are currently envisaged. Furthermore, short-term adaptation can result in long-term maladaptation, increasing vulnerability to climate shocks. The article argues that development urgently needs to shift its focus away from prevailing growth and yield-maximisation models towards alternatives encouraging resilience and risk-spreading. [ABSTRACT FROM AUTHOR]

The OECD questions whether non-state services in fragile states may delegitimise the state in the eyes of citizens, arguing that ‘state-building’ depends on governments’ engagement in service management. This article reviews the available evidence to identify what types of engagement are feasible and most likely to contribute to service delivery, or not to damage it. It considers the capacity requirements and the risks associated with state intervention through policy formulation, regulation, contracting and mutual agreements, and concludes by identifying ways of incrementally involving the state, beginning with activities that are least likely to do harm to non-state provision. [ABSTRACT FROM AUTHOR]