Development Studies and Development Economics
The emergence of DS programs after the Second World War was grounded in wider processes of decolonization, the universalization of the nation-state system, and the onset of the Cold War. More specifically the rise of DS was closely connected to the emergence of development economics in this period. From its inception the discipline of economics was preoccupied with understanding economic growth in North America and Western Europe. However, against the backdrop of the Cold War, the emergent discipline of development economics (and what eventually became known as development studies more broadly) explicitly sought to understand the causes of poverty and underdevelopment in what became known as the Third World.
A key role in the establishment of development economics is often assigned to economists working in Britain during the Second World War, in particular Paul N. Rosenstein-Rodan. During the Second World War Rosenstein-Rodan encouraged research on economic development at the Royal Institute of International Affairs, Nuffield College, where he was secretary of the committee on post-war reconstruction. In the 1950s he emerged as a key figure at the Center for International Studies (CENIS) at the Massachusetts Institute of Technology (MIT). Following its establishment in 1951 CENIS emerged as an important nexus for development economics and modernization theory. MIT itself had already emerged as the biggest defense contractor of any university in the United States by the end of the Second World War, a position it occupied, followed closely by Stanford University, throughout the Cold War and into the post-Cold War era (Leslie, 1993, pp. 11â12).
For Rosenstein-Rodan and his colleagues, government-planned industrialization was the key to national economic development. The importance of industrialization was exemplified in the writings of W. Arthur Lewis. Apart from writing a number of influential works on development economics in the 1950s, Lewis also made a major contribution to the 1951 United Nations report Measures for the Economic Development of Underdeveloped Countries. Lewis embodied the growing concern of many North American and Western European policy-makers, and development economists, that the Soviet model of nation-building was gaining support in Asia, Africa, the Middle East, and Latin America (for example, see Lewis, 1955, p. 431). Lewisâs work also represented a major point of departure for W. W. Rostowâs efforts to articulate a developmental alternative to Marxism. In the 1950s Rostow was closely associated with CENIS, then in the 1960s he served in various positions under both John F. Kennnedy and Lyndon B. Johnson. Rostowâs book, The Stages of Economic Growth: A Non-Communist Manifesto, symbolized the high modernist and anti-Communist approach to nation-building emanating from Washington in the early 1960s. First published in 1960, the book called on âwe of the democratic northâ to âface and deal with the challenge implicit in the stages-of-growth ⌠at the full stretch of our moral commitment, our energy, and our resourcesâ (Rostow, 1960, pp. 162â167).
During the 1960s, however, development economics increasingly lost its luster (Krugman, 1999, pp. 6â7; Seers, 1979). A central factor in this decline, as manifested in the highly politicized conclusions of Rostowâs work, was that the political and social complexities that development economists faced were not given sufficient consideration at the outset. For example, the work of Gunnar Myrdal exemplified the view that underdeveloped nations could not escape from poverty unless they embarked on major state-guided national development efforts, supported by substantial foreign aid (Myrdal, 1957). However, writing many years later, Myrdal conceded that what had been needed in underdeveloped nations âin order to raise the miserable living levels of the poor massesâ was âradical institutional reformsâ and the governments of the new nations had not been able to bring these about (Myrdal, 1968, pp. 47, 66â67).
More broadly, one of the most significant weaknesses of development economics, and of a wide range of theories of modernization in the high period of national development, was the taking of the nation-state as the unquestioned object of their technocratic and paternalistic efforts. The emergence of modernization theory in the 1950s and early 1960s is generally seen, in part, as a response to the failure of development economists to address the wider political questions associated with nation-building. The radicalization of DS by the 1960s, and its broadening to incorporate an increasing array of social science disciplines, also reflected a reaction to the failure of DS and its consolidation around development economics as the key to the delivery of modernity.
Development Studies and Neo-Classical Economics
The influence of development economics as a dominant set of ideas about economic development and nation-building, and the overall character of DS, shifted in the 1970s and 1980s with the growing ascendancy of neo-classical economics against the backdrop of the rise of neo-liberalism and the US-led globalization project. This reorientation was readily apparent at the World Bank. By the 1980s, US influence over the Bank and beyond was increasingly grounded in the Bankâs dependence on world financial markets, the position of the US as a global financial center, and the closely aligned interests of key financial actors with those of US foreign policy.
The high period of neo-classical fundamentalism at the World Bank peaked by the second half of the 1980s as ideologues gave way to technocrats in Washington during the second Reagan administration. This shift was marked by the change of presidents at the Bank from Clausen to Barber Conable (1986â1991). With Conable at the helm, the organizationâs public image was seen to be more consensual than under Clausen, while poverty alleviation and the mitigation of the social costs of structural adjustment were given greater prominence.
The World Bankâs understanding of development into the 1990s, despite the relative retreat from neo-classical fundamentalism, continued to be, or increasingly became, influenced by the rise of rational choice theory. The dramatic ascendance of rational choice theory (or the new institutionalism and the new political economy) in this period resulted in a highly mechanistic approach to the dynamics of political and economic change. Like the approach to economic behavior taken by neo-classical economics, rational choice theory built its explanations for political behavior on assumptions about the rational calculations that informed the policies and actions of the individuals and groups concerned. By the 1990s, the terminology of rational choice theory, if not the more rigorous versions of its conceptual framework, was being widely deployed, facilitating the revision and the strengthening of the neo-liberal ascendancy (Leys, 1996, pp. 36â37, 80â82).
By the end of the 1990s, however, the World Bank had ostensibly made a shift from âstructural adjustmentâ to a focus on a âcomprehensive development frameworkâ that again fore-grounded poverty alleviation (Pender, 2001, pp. 397â411). This shift has been reinforced, although not necessarily manifested to a great degree in practice, by a renewed emphasis in the wake of September 11, 2001, on the importance of foreign aid and poverty alleviation to engender economic and political stability and undercut the appeal of fundamentalist Islam.
However, as contemporary neo-liberal nation-building in Iraq, which will be discussed below, demonstrates, this does not represent a retreat from any of the core elements of the US-led globalization project within which the World Bank plays a central role (Cammack, 2002, pp. 125â132). In fact, since 9/11 the primary emphasis of key international actors, such as the US government and its various agencies, has been to reinforce the neo-liberalism at the center of the globalization project. One result of this trend has been to marginalize further the social development agenda of branches of the World Bank and the United Nations. As more than one commentator has noted, since 9/11 the administration of George W. Bush has increasingly defined security in a way that views brute force as the only solution to âany and all opposition, regardless of its origins or goalsâ (Murillo, 2004, p. 15, also see pp. 27â28). This has been reinforced by the steadily increasing expenditure on defense by the US government. The Secretary of Defense, Donald Rumsfeld, appeared to make a concession in the early months of 2006 that the US needed to focus on âhearts and mindsâ as well as âshock and aweâ. However, neither his public utterances nor the Quadrennial Defense Review (which came out in February 2006) reflected movement on the part of the White House, or the Pentagon, towards a broader conception of security. Despite Rumsfeldâs subsequent resignation at the end of 2006, there is still no apparent recognition that what the Bush administration and the Pentagon are now calling the âLong Warâ is also a new war. In practice there has been little or no serious reconceptualization of counterinsurgency and nation-building or rethinking of the war on terror itself (Berger and Borer, 2007).