IPPG Cluster on State-Business Relations Emerging themes and policy messages Dr Dirk Willem te Velde December 2009 CUTS-IPPG meeting Jaipur

Introduction Diversity; heterogeneity; disciplines Audiences, messages, channels Quick synthesis What’s next?

Diversity in methodology, methods and unit of analysis Political/historical analysis of SBR  Country level  State level Measuring SBR  Country level  Firm / individual level Econometrics of effects of SBR  Multi-Country level  Meso / sector level  Micro level Functional approaches Case studies (sometimes combining all of this!), formal/informal

Audiences  Academia (e.g. journal readers and colleagues, especially those that work in “silos”)  Policy makers (national/state)  Politicians (pro labour, pro capital)  Business (small and large)  CSOs  Media  External actors, donors, funders (bilateral eg DFID, multilateral eg World Bank, UNIDO)

Messages Academic – innovations in literature in institutions and growth Measurement – new debates amongst disciplines, pushing the disciplinary boundaries SBRs matter, whether formal or informal (e.g. check variation in states, or countries) Formalised SBRs fulfill economic functions e.g. through budget process (Zambia, Mauritius) Formalised SBRs can work, but they can fail to function when there is no buy-in (Mauritius vs South Africa) Voice of small business in formal BAs (Mauritius) AND in informal bargaining (South Africa) often underrepresented

Channels IPPG discussion papers IPPG briefing notes Conferences and workshops Breakfast meetings Press releases Blogs discussions Journal articles Informal contacts

SBR case studies (Africa) Synthesising SBR Research Drivers Describe/ measure Economic functions Effects on growth performance Ghana Historical institutionalist inductive theories Existing data setsMicro econometrics Mauritius Analytical and historical accountSurvey Effect SBR on budget policy proposals Micro econometrics / firm performance / macro economics South Africa Tracing history of state- business organisation, explore nature of sub- national SBR Effect SBR on trade and industrila policy Zambia Effect SBR on allocation of pro poor public spending

SBR case studies (Africa) Synthesising SBR Research DriversDescribe/ measure Economic functions Effects on growth performance Ghana Politics matters for determining forms of SBRs Number of known politicians and bureaucrats; but formalised SBRs evolving rapidly Informal networks with civil service and politicians matter, but questions on importance of formalised SBR remain Mauritius Long history of co- habitation (though disputed) Proposals taken over by budgets (new measure) SBRs affect govt budgets (via JEC)SBRs enhance growth South Africa Informal networks (politicians and big business) prevail Historical accounts of SBRsNot significantNo debate within NEDLAC Zambia Budget proposals submitted Effect SBR on allocation of pro poor public spending

Emerging themes (from African studies)  Formalised can SBRs matter. Mauritius (Rojid et. al.): Joint Economic Council is influential private sector actor in SBRs in Mauritius; Measured SBR leads to higher growth ( ). How? E.g. suggested budget proposals for better industrial policies are frequently taken over by government budgets.  But effective formalised SBR cannot simply be put in place. South Africa (Natrass, Seekings): Nedlac did not provide a real consensus seeking forum, due to weaknesses in state, although some success in industrial policy.  Formal consultative fora do perform useful functions helping business at macro level. Zambia (Bwalyas, et al.): analysis of new, transparent mechanisms to channel budget proposals suggest that business organisations / actors have influenced budget outcomes (esp using civil servants), more than other stakeholders.  There are informal SBRs; is it a stepping stone towards formalisation. Ghana (Ackah et al.): more developed social networks (politicians, civil servants) of firms (#256) lead to better firm performance  BA membership associated with better form performance. Across Africa (Qureshi and Te Velde): business membership leads to better firm performance by reducing policy uncertainty and lobbying, but individual lobbying remains important!

Linking audiences, messages and channels Academics – new ways (methods and methodologies) of looking at (PP) growth which include SBRs (empirical examinations rooted in theory); journal articles and workshops Government policy makers – we know that informal networks matter, but formalised ways of engaging with business can be useful for development, or specific interventions can help a better conduct of SBR, and we have a few specific suggestions how it can be fostered; briefings, informal contacts Business – engaging in a well informed democratic conversation with government helps; SMEs feel underrepresented; meetings with business Funders / donors – consider SBRs in advice and indices (eg engagement with WEF); SBRs evolve slowly over time, but there are critical junctures, and investing in SBRs matter; however, effective SBRs cannot simply be put in place; policy briefings

Possible ways forward Syntheses and messages in print / actioned (academic and policy relevant) SBR research and practice has a bright future  It opens up new debates and can build bridges  Gaps: primarily the what and how of economic functions, interactions between formal and informal SBR, and formal/informal links, social networks/sociological  It has real relevance to today’s problems (e.g. GFC) Keep on doing it

THANK YOU