Rethinking Economic Reform: The Controversial Outcomes of Structural Adjustment

By Lofchie, Michael F. | Harvard International Review, Spring 2008 | Go to article overview

Rethinking Economic Reform: The Controversial Outcomes of Structural Adjustment


Lofchie, Michael F., Harvard International Review


The co-authors of Human Rights and Structural Adjustment, M. Rodwan Abouharb and David Cingranelli, present a simple and straightforward argument: the economic reform programs initiated by the World Bank and International Monetary Fund in the 1980s, which tended to be lumped together under the awkward phrase "structural adjustment," caused a progressive worsening of human rights conditions in the countries that undertook them. The longer a country was exposed to structural adjustment, the worse the country's human rights conditions became. To make matters worse, these authors argue, there is little or no convincing evidence that these economic reform programs led to improved economic performance or, in any case, that they led to improved economic performance with social equity. The authors leave no room for ambiguity as to where they stand in regards to the effects of market-based policy changes in transitional societies. One chapter connects economic reform with "Torture, Murder, Disappearance and Political Imprisonment" (Chapter 8) while another links economic reforms to heightened levels of ethnic strife, civil war and other extreme forms of political turbulence.

One's first thought is to ask what might have prompted such a one-dimensional treatment. Is 2008 the new 1980s, when such views were still relatively new and more likely to produce serious academic controversy? Perhaps the authors had their own doubts, which may explain their repeated insistence on scientific methodology. But the claims to scientific methods do not add to the plausibility of arguments that are, at their core, both empirically weak and ahistorical. We are insistently told that the authors' statistical correlations are "robust" and that there is no "selection bias" in the choice of cases. For the more quantitatively minded, there is even a discussion of the choice of logit and probit as statistical programs. And at one point we are treated to proof by counter-factual--a suggestion that the countries that adopted adjustment programs would have been better off had they not done so in the first place. There is a touch of insecurity in the authors' insistence that their open-mindedness is demonstrated by their willingness to cite studies with different points of view. Those studies are casually brushed aside at every turn.

What are we to make of a volume like this? Ironically, one reasonable reaction would be a sense of relief. Scholarship that preaches to the previously committed is fairly commonplace in both academic life and in policy circles and, regrettably, seems unusually common among studies in this genre. For the most part, the academic world treats such scholarship in fairly predictable ways. Demonizing the Washington-based international lending institutions (ILIs) is nothing new, and this volume will be treated by most readers as simply one more treatise in the already over-crowded World Bank-bashing genre. On page 21, the authors state that "Libraries are full of case studies showing the negative effects of structural adjustment." While undoubtedly true, it would be more helpful to know how many of these studies have genuinely added to our understanding of the short and long term effects of economic reform. Academics and policymakers who are seeking a more balanced presentation of the costs and benefits of economic reform or guidance in how to make the process of reform proceed more effectively will not find it here.

On the other side will be those already persuaded that market-based economic reforms are indeed responsible for the economic ills and some of the most grievous political shortcomings of the developing world. These readers will take great consolation in this volume and, no doubt, treat it with acclaim as persuasive evidence of the negative effects of these institutions.

Much more could have been done to provide real value to the already considerable stock of literature on this topic. Now that nearly three decades have elapsed since the World Bank and the International Monetary Fund began to engage in market-conditioned lending to developing countries, the stage is set for a complex assessment of the gains and costs of those programs. …

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