Economic Development Is Not Neutral: Understanding African Economies

Introduction

The development of the economy is usually considered a technical discipline with objective measures and quantifiable results. Growth rates, inflows of foreign direct investment (FDI), institutional rankings, and export performance are standardized measures used to evaluate the paths of economies. In this paradigm, development is presented as a quantifiable and measurable process: countries improve or worsen relative to their performance with reference to the standardised criteria.

However, there is an important limit behind this outward neutrality. The conceptualizations of how development is analysed are not simply descriptive instruments but reveal themselves to be a set of interpretations that incorporate assumptions about what development should be, how it is supposed to take place, and what consequences are preferable. These serve as conditions of analysis in the background and organize both academic discussions and policy recommendations, and appear as objective standards.

This creates a paradox of its own. African economies are often described as underdeveloped, but this measure depends on a set of criteria that are historically constructed by external actors. Progress is associated with economic development, having an international presence in global markets and attracting FDI. They are the result of deeply established Western intellectual traditions of development economics.

The main point promoted by this article is that we must move away from the idea that economic development should be measured by ‘neutral’ Western formulas. Instead, we should adopt metrics that intentionally account for local social goals, political realities, and the unique way African societies function. Western metrics do not reflect African economic reality, they actively construct it by making visible and rewarding. They produce effects that not only affect the way African economies are being understood but also the way African are being governed.

Development Economics as a Normative Framework

Development economics is a discipline based on empirical research and rigorous analysis. Nevertheless, there is a set of prevailing models that study development through specific lens. These include growth, market, investment, and institution models. While having different focuses, they agree on setting standards for measuring economic performance.

Growth-centred models consider Gross Domestic Product (GDP) growth to be the major measure of development. According to this model, growth depends on national productivity and added-value activities, such as manufacturing or agricultural output quantities. This analysis can be problematic. Growth is a measure of scale, not structure; it measures the size of the economy but fails to determine how it is structured, its governance, and where the value is added.

Market-led models bring about new assumptions. They are based on the neoclassical economics tradition, which asserts that efficient markets manage the distribution of resources most appropriately and market liberalization promotes productivity. It’s the approach pushed forward by M. Thatcher in the UK and R. Reagan in the U.S. during the 1980s. Development, therefore, can be seen as the result of the elimination of state intervention, trade barriers, or regulatory constraints. This model, however, assumes that markets exist under an environment where productive capabilities already exist or can be created by chance. It is detached from the historical processes in which such capacities were built. Most of the Western industrialized countries have such economic models, while most of the globa Southern countries do not, which limit their ability to implement such norms.

Following an investment-led model, capital inflows, or FDI, are usually directed to productive transformation of sectors like mining or agriculture aimed at achieving industrialization. However, the fundamental assumption is that in order to be productive and drive development, investment must happen in an industrial ecosystem that can absorb, diffuse, and eventually upgrade. When the ecosystem does not have these characteristics, investment is not embedded in the economy, and development is limited. Plenty of research demonstrates this dynamic, led by big tech corporations in developing countries. Ultimately, the benefits do not flow within the local economy or the local labor market, but remained within the foreign company’s walls.

Institutionalist approaches change the focus to governance and the role of institutions in determining economic results. It is perceived that strong institutions, measured in terms of property rights, quality of regulations or rule of law, just to mention a few, are preconditions to economic development. Although such a view is important in bringing up governance issues, it tends to consider institutions as independent variables, instead of products of political and economic dynamics. It also has the tendency to generalize institutional forms based on particular historical experience ignoring the fact that these structures are often deeply embedded in a country’s specific social reality and power struggles. One of the best examples of this is the push by international organizations towards formalized land titling and private property rights in several African countries. Paper-wise, this “institution” is considered an independent variable that is supposed to automatically result in higher investment and growth (the Western historical experience). But in practice, these rights are frequently a product of political and economic relations: the strong elites can take advantage of the new formal system to expropriate land belonging to communal owners who lack any formal paperwork.

Within these frameworks, there are a number of assumptions made. One is that markets are the major drivers of development; investment is supposed to bring economic change, notably by allowing local sector to develop; global market integration is regarded as desirable; and development is considered a sign of progress. These are not simple observations but theoretical pillars of the models. They are indicative of a specific vision of the way economies develop – a vision that values efficiency, openness, and accumulation of capital.

When the main measure is growth, then whatever increases in GDP is seen as progress. When we assume that global integration can do good, then an increase in exports is well-seen, even when this strengthens reliance on low-value components of the global value chain.

In this regard, development structures play a constructive role. They are defining development, stagnation, and failure. They also influence policymaking. Development policies based on the mainstream models of liberalization, investment promotion, and institutional reform seem quite sensible and justified. Other approaches, such as selective protection, state-led industrialization, or capability-oriented interventions, can be seen as being inefficient.

The Political Role of Development Frameworks

If development frameworks are normative, they are also inherently political. Indeed, most of these frameworks are not neutral and often reflect political vision and goals more than economic ones. They have an impact within academic circles but also on the structure of economic regulation. They influence policy decisions, form international interventions and specific development paths.

At the policy level, development models are instruments of justification. Policies by governments are not only aligned with prevailing models of analysis because they seem economically viable, but also because they are indications of adherence to internationally accepted norms. This conformity increases credibility and eases the availability of external financing as well as placing governments in the global policy networks.

At the international institutional level, development frameworks structure economic interventions. Standardized analytical tools used by multilateral organizations, donor agencies, and development banks evaluate economies and design different economic programs for developed nation to follow an economic trajectory that is supposed to help them to get out of poverty. These instruments incorporate certain presuppositions regarding sound policy, which then define conditionalities and reform programmes. Consequently, policies tend to become similar and uniform rather than be place-based.

More fundamentally, frameworks of development build political legitimacy. Development has been the most important evaluation measure of governments in postcolonial contexts. The capacity to provide development outcomes, interpreted through the same conceptual tools that form the evaluation structure, is becoming more and more associated with political control. This forms a vicious circle: structures conceptualize success, and success justifies the structures.
As an example, the World Bank Ease of Doing Business index, which is a ranking from the World Bank classifying countries based on their business environment, tended to encourage African governments to make quick-and-shallow legal reforms, like reducing the number of days to register a company, which produced a measure of success on paper that was then used to justify the centralization of political power, even if the economic structure remained similar for the average citizen.

This is a dynamic that leads to the depoliticization of development. Development frameworks make political choices look like purely technical problems by describing economic decisions in neutral, scientific terms. Industrial strategy, sectoral priorities, or types of economic organization are brought out as issues of efficiency and not controversial political decisions. This leaves very little room for other visions and restricts the arena of democratic discussion.

But development structures go beyond the depoliticizing process by actually organizing politics and economics. They determine which strategies should be acceptable, influence the incentives of policymakers, and influence the way interactions between domestic actors and international institutions take form. In this respect, economic analysis is included in governance itself. It not only narrates economic processes; it is also a part of their manufacturing.

Resource-Led Growth and the Limits of Standard Indicators

The analytical extension of development models is most apparent in resource-based economies, including the copper and cobalt economy in Africa. These industries have undergone tremendous growth in the recent past owing to increased global demand, investments and heightened export levels.

Under the eyes of conventional measures of development, this trend is evidently favorable. Export earnings go up, foreign investments intensify, and the performance of macroeconomic indicators improves. In growth-centred and investment-led models, these are results of effective development. Resource sectors are considered as drivers of development and an easy gateway to international markets.

Nonetheless, this interpretation is based upon a specific interpretation of economic change, where scale is more important than structure. A structural analysis paints a different and more detailed picture. Although they are doing well in aggregate indicators, there is usually limited industrial upgrading in these economies. Production activity is still concentrated at the initial and low-value stages of the value chain, like extractions and simple processing, while high-value activities like refining, manufacturing, and technological advancement are done in other countries. This is for example the case of the Democratic Republic of Congo whose industrial activities in the mining sector, especially in the copper and cobalt sector are mainly concentrated at early, low value-added stages of production (refining and treatment) while downstream activities are done in foreign countries, such as China, once minerals are exported. Therefore, the country fails to capture an important part of the value that these minerals could create for the Congolese economy.

The economy grows, but the framework of production does not change much. National capacity building is limited, and it still relies on outside actors. The economy becomes incorporated in the global markets, albeit at certain terms that restrain the capacity of an endogenous transformation.

Normal measures apprehend growth, not change. They capture gains in production but fail to capture gains in productive power, technological complexity, and value dispersion. Consequently, they can create a picture of success that hides structural bottlenecks.

It is not a matter of information but meaning. Therefore, certain metrics such as growing exports, growing investment, and growing improvement of macroeconomic performance can be interpreted as a victory in one system and as a stunted development in another. The point of difference is what the framework is set to capture.

The example indicates a greater limitation of analysis. Development is not something that can be narrowed down to a combination of aggregate indicators. It is an organizational transformation that entails changes in production, capacities and economic organization. Frameworks that fail to capture such dimensions risk falsifying the character of economic transformation.

Conclusion: Toward a Reflexive Political Economy of Development

This article does not argue that economic analysis should not be undertaken, but rather to understand that development frameworks are not neutral. It requires a reflexive method, one that questions the assumptions that are entrenched in the instruments of analysis and how the assumptions inform policy.

The starting point of such an approach is the following fundamental questions: What is being measured, and why? What aspects of economic change take preeminence? What types of change are being made invisible? What theory of development is presupposed?

These questions change the orientation of the outcome to the process, the indicators to the structures, and the measurement to the interpretation. They open up the option of other analytical approaches that focus on structural change, capacity building, and redistribution of value in economies.

A structural perspective provides a path forward. By focusing on production, transformation and retention of value in the economies, this approach could capture the aspects of development that aggregate measures fail to capture. It puts emphasis on the productive capabilities, technological modernization, and institutional coordination. It also acknowledges the fact that development is not a linear process but rather a disputed and unbalanced change, which is influenced by political and economic dynamics.

After all, it is not merely the necessity to make current measures better but the need to re-examine the very conceptual premises of development analysis. 

As far as analytical frameworks are regarded as neutral, their political and ideological aspects will be hidden. And so as long as they go largely unchallenged, they will still inform the perception of the economies of Africa in such a way that constrains analysis as well as policy imagination.

Development in this meaning is not merely an economic process. It is even an epistemological and political one. Its definition will dictate how it is followed.

Please Read the Following for More Information:

“Unlocking Africa’s development potential: insights from the perspective of global hierarchy and competition”, Humanities and Social Sciences Communications, Fanglei Wang, Jianbo Gao, and Feiyan Liu, 2024 

“Exploring the Path of Autonomous Development: the Development Dilemma and Coping Strategies of Sub-Saharan Africa in the Post-epidemic Era”, Journal of Knowledge Economy, Mo Bi and Zhenke Zhang, April 10, 2023 

“Changing the narratives on Sub-Saharan Africa’s failure to develop”, London School of Economics and Political Science (LSE Research for the World), Leigh Gardner, January 18, 2022