Reversing poverty : the role of institutions, state capacity and human empowerment

Abstract

The study explores the fundamental causes of poverty persistence, which remains a central challenge of the modern world. In theory, rising political participation operationalises checks on state predation and cultivates development-enabling state capacity. This did not materialise in post-colonial sub-Saharan Africa. The theoretical foundation of this premise is further brought into question by the development achievements of strong, capable non-democracies. The study uses a dynamic, panel-data model to explore a probabilistic development hypothesis that fuses broad institutionalism with modernisation and human empowerment. The model relies on regime-independent state capacity to trigger the transformational impetus of rising existential security, autonomy and individual agency. Ensuing shifts in societal value orientations towards emancipative mindsets then drive the progression towards prosperity. The results show that the poor-country deficit in human empowerment, represented by mind-broadening education and emancipative values, dwarfs the shortfalls in all other drivers of prosperity, including exports and investment. The findings rule against geography and democracy as direct drivers of prosperity.