By Leanne Zeppenfeldt
In the past decades, development efforts have increasingly been focused on women emancipation and gender equality, as girls and women constitute 70% of the people living in poverty worldwide. The emancipation of women would not only benefit them, but their emancipation would spur development throughout their societies.
Many projects, often funded by important international institutions (IMF, World Bank, UN) have aimed to empower women by giving them access to funding or micro-credit to enable them to develop their own enterprise. Usually, rules and requirements for participating in these development aid projects are well established and formalized, in order to make sure the money ends up where it was intended: with the women. Unfortunately, designers often ignored or were unaware of informal institutions and power dynamics that greatly impacted the outcome of their implemented aid efforts.
For example, in several developing countries an informal institution exists that “requires men” to be in charge of the entire household income. While most development programs monitor whether the microcredit gets spent on actual enterprise development, few are able to monitor what happens with the income generated afterwards. As a result, the informal institution mentioned above might result in all the income flowing to the male head of the household, which is in great contradiction with the formalized rules of the development project. That is, the informal institution results in a divergent outcome from the intended outcome of the formal institutions, since these are ineffectively implemented. What results is an informal institution that competes with the formal ones and results in a failed effort to emancipate women in developing countries. In short, informal institutions should be incorporated in the design of development aid programs if we want to prevent our development money going to waste, or in the worst case, making things worse.