Government’s invisible hand in developing countries

MIT political scientist Noah Nathan’s new book, ’The Scarce State,&r
MIT political scientist Noah Nathan’s new book, ’The Scarce State,’ looks at the way seemingly minimal state oversight in rural Ghana has actually had profound effects on society. Credits : Image: Courtesy of Noah Nathan
Political scientist Noah Nathan’s new book, "The Scarce State," explores the deep impact government can have even when it is seemingly absent.

In the countryside of northern Ghana, there is not much evidence of government in action. There are few paved roads, state buildings, or law enforcement officials. It is easy to think the state lacks the resources to control much of anything in such places.

"In the rural periphery of the developing world, we tend to think of the state as being quite absent," says MIT political scientist Noah Nathan. "You can see there aren’t many offices, bureaucrats, or police. The state has a light footprint. As a result, we think the state is weak, and unable to change rural politics and society."

Except, as Nathan’s research shows, governments actually can make a profound impact in these situations - and have, in places like rural Ghana. Far from being a nonfactor, the Ghanaian state, by building rural schools with limited access, or by applying property rights selectively, has created more inequality and unrest in society.

Nathan explores this territory in a new book, "The Scarce State: Inequality and Political Power in the Hinterland," published by Cambridge University Press. In it, he examines the history of Ghana’s rural interventions, and their resulting social and political dynamics, while also analyzing related circumstances in Peru and the Philippines.

"What I’m saying with this book is, the state is not out of the picture," Nathan explains. "The state may not have done very much, but the few things it did do had enormously large impacts on the politics of this region. Political leaders may withhold the state’s power, but it doesn’t mean the state is incapable of changing society. Quite the opposite."

Chiefs, an invented tradition

In the book, Nathan studies three types of state actions in rural Ghana: the use of traditional chiefs as local government surrogates, the placement of public schools, and the selective application of property rights.

Britain colonized Ghana in the 19th century. In the early 1900s, the British began installing chiefs as local leaders and government surrogates. However, as Nathan chronicles, in many parts of rural northern Ghana, these chiefs were simply a British invention. Ghanaian society had existed without them. Still, over a few decades, as British-appointed chiefs were propped up by the colonial government, they became entrenched, and accumulated outsized portions of whatever local wealth existed.

"We tend to think, based on stereotypes in the media, that chieftaincy is a natural form of governance in a lot of African countries," Nathan says. "But in some parts of this region, it’s a complete colonial import. For many communities, this is an institution without any indigenous roots. It was proposed arbitrarily by British colonial officials and created new inequality, and unequal access to political power."

The British also began building public elementary schools in Ghana, but their distribution was uneven as well. By 1954, three years before Ghana won independence from Britain, the northern region had just 3 percent of Ghana’s elementary schools despite being home to 20 percent of the population.

These schools were, as Nathan writes in the book, "the most present arm of the state by far." But access to them was limited. By the early 1960s, only 65 percent of communities in northern Ghana were within about 6 miles of a school, and funding shortages meant many children were unable to attend, into the 1990s.

Those who could attend, Nathan writes, received "a head start in education access of a generation or more compared to the broad majority of the population." This created a compounding effect: Educated people got better jobs, and their families were more likely to make subsequent gains.

Finally, Ghana’s own postcolonial government made property rights changes starting in the 1970s, but again on unequal terms. National leaders handed out property rights to local leaders in exchange for political support - meaning such programs again favored those who had already gained from the state’s prior actions.

In a book that is both quantitative and historically grounded, Nathan compares different regions within Ghana and finds that these rural state interventions in the north "provided valuable windfalls, creating new stratification across generations," as he writes.

"This has changed society," Nathan says. "These are societies that were very flat and had not had much economic inequality historically, and it’s the state coming in and creating new forms of local governance, or creating public education in a really selective way for many decades, that created economic inequality."

Extending power on the cheap

These limited actions served a clear purpose, for both colonial Britain and Ghana’s postcolonial rulers: They have been inexpensive ways to govern the hinterlands.

"State leaders want power, and they want to keep as many resources for themselves as they can," Nathan says. "In these regions, they’re not incentivized to spend money. They will apply resources to places where they have pressing threats. If there’s an opportunity to govern on the cheap and get away with it, they’ll do it. In northern Ghana, they did that. In other parts of Ghana where there were more resources to extract, colonial rule was incredibly intensive."

Any improvements in rural governance, Nathan believes, must account for these incentives. Some policy experts believe developing countries should strengthen the state; others want NGOs, for instance, to play a larger role. However, Nathan says, "neither is necessarily the right tool to solve these problems. If the state doesn’t have political incentives to govern equitably, just giving it more resources might make the problems worse. Can we think of interventions that make state leaders in the center want to govern in the periphery in a hands-on and more equitable way?"

Other scholars have praised "The Scarce State." Margaret Levi, a professor of political science at Stanford University, has called it a "theoretically original and empirically rich book" that "reveals the outsized impact of rare state interventions on social, economic, and political relations in the hinterlands."

For his part, while Nathan focuses on Ghana in his own research, he believes the book will serve its purpose, in part, if it spurs more inquiry about the dynamics of seemingly scarce state governance globally.

"These dilemmas in Africa have been quite similar to those in other areas," Nathan observes. "I would like to make this a bigger conversation, and not have it be siloed as something particular to African politics."

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