Institutional Incentives and Sustainable Development: Infrastructure Policies in Perspective

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Overview

Integrating recent research in the fields of public administration, public finance, institutional economics, and policy analysis, this book shows how institutional arrangements and the incentives they generate can help or hinder development efforts. The authors present a method for systematically comparing alternative institutional arrangements for the development of rural infrastructure. Their analysis reveals the special strengths and weaknesses of polycentric as compared to centralized or decentralized institutional arrangements. Descriptions of a variety of infrastructure projects—including roads, bridges, and irrigation systems—in geographical settings as diverse as Africa, Asia, and Latin America are used to illustrate key concepts.Perfect for courses on policy analysis, development administration, and economic development and for use by professional practitioners, Institutional Incentives contributes appreciably and practically to the understanding of sustainable development, infrastructure maintenance, institutional analysis, and the central importance of institutional arrangements.

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Product Details

Meet the Author

Elinor Ostrom is Arthur F. Bentley Professor of Political Science at Indiana University and codirector of the Workshop in Political Theory and Policy Analysis there. Larry Schroeder is professor of public administration and economics at the Maxwell School of Syracuse University. Susan Wynne is a research associate at the Workshop in Political Theory and Policy Analysis. Elinor Ostrom is Arthur F. Bentley Professor of Political Science at Indiana University and codirector of the Workshop in Political Theory and Policy Analysis there. Larry Schroeder is professor of public administration and economics at the Maxwell School of Syracuse University. Susan Wynne is a research associate at the Workshop in Political Theory and Policy Analysis. Elinor Ostrom is Arthur F. Bentley Professor of Political Science at Indiana University and codirector of the Workshop in Political Theory and Policy Analysis there. Larry Schroeder is professor of public administration and economics at the Maxwell School of Syracuse University. Susan Wynne is a research associate at the Workshop in Political Theory and Policy Analysis.

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Table of Contents

List of Illustrations
Preface
Acknowledgments
Introduction
1 The Role of Infrastructure in Development 1
Postwar Development Initiatives 2
An Institutional Approach to Explaining Development Outcomes 8
The Importance of Physical Infrastructure 10
What Do We Mean by Infrastructure Sustainability? 13
An Overview of Our Approach 18
2 The Problem of Sustainable Infrastructure 25
Infrastructure Maintenance and Its Finance 25
Phases of Infrastructure Development 29
Factors Influencing Maintenance Decisions of a Single Owner-User of Private Capital 34
3 Individuals, Incentives, and Transaction Costs 43
Assumptions About the Individual 44
Problems of Contractual Uncertainty and Transaction Costs 46
Information Asymmetries as Sources of Contractual Uncertainty 49
Kinship Networks as Counteracting Institutions 62
Nepotism and Corruption 65
4 Provision and Production of Rural Infrastructure 73
Distinction Between Provision and Production 74
Attributes of Rural Infrastructure Primarily Affecting Provision 76
Attributes of Rural Infrastructure Primarily Affecting Production 97
5 Evaluating Institutional Performance 111
Overall Performance Criteria 112
Intermediate Performance Criteria 118
6 Analyzing Institutional Arrangements 127
Institutional Arrangements for Private Infrastructure Development 128
Institutional Arrangements for Public Infrastructure Development 134
7 Centralized Institutional Arrangements 141
Centralized Infrastructure Development 142
The Problem of Truncated Analyses 154
The Role of Donor Agencies 156
8 Decentralized Institutional Arrangements 163
Decentralization Efforts 164
Does Administrative Decentralization Improve the Performance of Centralized National Governments? 168
9 Polycentric Institutional Arrangements 177
The Concept of Polycentricity 178
The Possibility of Polycentricity in Developing Countries 184
Some Common Concerns About Polycentric Arrangements 192
Privatization as a Form of Decentralization 206
10 Implications of an Institutional Approach to Sustainable Development 213
The Proposed Analytical Approach 215
General Policy Implications of Our Approach 218
Immediate Policy Implication of Our Approach 223
References 235
About the Book and Authors 256
Index 257
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