ECONOMIC AND SOCIAL WELL-BEING

“Without economic hope, peace cannot take hold.”
— Johanna Mendelson Forman

INTRODUCTION
Traditional economic theory assumes that private “egoistic” entrepreneurs are driven by profit, while “benevolent” policy makers are seeking maximum public welfare. The “political economy” approach departs from this basic assumption and analyzes the demand and supply sides of economic policy, i.e. how individual preferences are defined, aggregated and channeled into political demands and how policy-maker preferences take shape accordingly. Political economy analysis thus adds an essential dimension to research on post-conflict reconstruction by placing postwar economic reforms in their political contexts. Under this approach, economic policy is viewed as the outcome of interactions among politicians, bureaucrats and interest groups within a set of institutional constraints.

Research on the political economy of post-conflict reconstruction reveals that the will and capacity of government to implement and manage economic reforms may be requirements for success, but not sufficient on their own. Powerful international and domestic actors are often in a position to block reforms if they refuse to cooperate. The political economy approach suggest that domestic constituencies must first be able to recognize their own interests and organize collectively to participate in the policy formulation debate, exert pressure for reforms and improve their situation.

OBJECTIVES

1. To identify how the international community can better assist governments in countries torn by civil war.
2. Identify the role the International Monetary Fund plays in assisting and hindering Post-Conflict Reconstruction.

ISSUES FOR DISCUSSION

1. How can we develop a system or process that ensures unity of effort in the identification of needs and the allocation of essential resources to achieve success?
2. How can we make certain that outside interventions be designed with the interests of the indigenous citizens?

REQUIRED READINGS
Sean Hagan, “The IMF’s Role in a Post-Conflict Situation,” Case Western Reserve Journal of International Law, 2006. (On Blackboard)

Johanna Mendelson Forman, “Achieving Socioeconomic Well-being in Postconflict Settings.” The Washington Quarterly. Autumn 2002. p. 125-138. (On Blackboard)

Donald R. Snodgrass “Restoring Economic Functioning in Failed States.” When States Fail: Causes and Consequences. ed. Robert I. Rotberg. Princeton University Press. 2004. pp. 256-268.