Formal and Informal Institutions in Development: Contexts, Resistance, and Leverage

This synthesis paper draws together the salient elements emerging from the RA4 case studies research, and from three thematic synthesis papers written by members of the RA4 Scientific Committee, Jean Marie Baland and Catherine Guirkinger, Dilip Mookherjee, and Christopher Woodruff. It discusses the issue of how to resolve the crucial discrepancy between formal and informal institutions that is often at the heart of the policy ineffectiveness found in several research projects. In particular, based on what has been learnt from these studies, Platteau and Verdier outline different strategies to mitigate this discrepancy, and discuss their costs and benefits. Finally, the paper provides tentative conclusions from the perspective of external donors and agencies supporting developmental policy reforms.