By Hannah van der Ham
As Mark Blyth explains, ideas matter when analyzing institutional change. This theory can also help us explain how ideas can lead to inefficient policies. One example is a strategy adopted by the World Bank to fight HIV/AIDS in Malawi. Here, the World Bank applied the ABC strategy which promotes abstinence, being faithful and using condoms. However, the approach had no effect in Malawi as abstinence does not lead to necessary offspring, extramarital marriage is quite common among men and condom use is interpreted as a lack of confidence in your sexual partner.
The adoption of this inefficient policy can be analyzed by applying Blyth’s five hypotheses about ideas. As Blyth explains, “ideas (not institutions) reduce uncertainty.” In this case, there is uncertainty about what strategy would fight HIV/AIDS in Malawi most efficiently. However, the World Bank probably chose the ABC strategy after researching what had worked in other cases. This allowed them to design a policy based on an idea of what might work, rather than a random “shot in the dark”. Secondly, the World Bank’s idea was then shared by other international agencies, making them act collectively and invest money to implement their idea. Thirdly, the idea that the ABC method works was then used as a “weapon” that allowed the agencies to disregard existing informal institutions (e.g. extramarital relationships) rather than building their policies around them. Fourthly, the agencies then implemented policies based on their idea, making it “an institutional blueprint”. Lastly, unless the agencies recognize that the ABC strategy is inefficient, their idea will keep these policies in place.
This shows that the World Bank adopted inefficient polices because they based these on an idea that did not coincide with the reality. Thus, it is always important in development aid to consider the ideas of local agents in addition to policy makers’ ideas. Moreover, policies should be adapted to local circumstances, rather than adapting the local circumstances to the policy. This will only increase the policies’ efficiency.