Friday, 17 May 2013

Change Factors- development works vs institutional building

As a result of general elections 2013, Pakistan has entered a new arena in which from now onwards performance of ruling parties would be judged on the parameter how much they would have improved life quality of common people. In this perspective, presently two different approaches are being debated on among political elites. One group of political elites is focusing more on development works as a potent agent of enhancement of life quality of common people; such political circles consider economic growth as important change factor on basis of which life quality of common people may be improved through development works. The second group of political elites is attaching more importance to institutional building as a vital source of enhancement of life quality of common people; such political circles consider economic growth as important change factor on basis of which life quality of common people may be improved through institutional building.
Both these political camps assign primacy to economic growth to pursue their peculiar approach to enhance life quality of common people. The reason is obvious; both institutional building and development works require funds which may be generated through economic growth. If required funds are obtained through means other than economic growth- for instance through privatization or borrowing- such a approach may not help improving economic growth because such an artificial way of raising funds carries with it many negative economic implications in the form increased debt burden and permanent loss of national assets. The ruling parties would have to increase revenues through better/enhanced collection of revenues by taxing so far untaxed sectors, and by plugging in tax pilferage. Another venue to safe national revenues is to control losses incurred by big national corporations through better management and organizational techniques and to control corruption in government sector. 
In other words, all possible means to enhance government’s exchequer, keeping within existing economic resources/revenue generating sources, are relating to institutional performance. But if government wants to generate extra economic resources/revenue generating sources through, for instance, enhanced exports, investment and employment,  government, for that purpose also, would require to enhance government revenues keeping within existing economic resources/revenue generating sources so that extra incentives may be given to exporters, investors and new jobs may be got created, to generate extra economic resources.  As enhancement of revenues keeping within existing economic resources/revenue generating sources is, in case of Pakistan, something relating to reformed institutions, it means institution building is the basic condition to enhance revenues both keeping within the existing revenue generating sources and through developing extra revenue generating sources. In other words, ruling parties in Pakistan have to assign primary importance to institution building whether they want to adopt development work approach or institution building approach to improve life quality of common people. Institution building is the essential route through which peoples conditions may be changed. Institution building is the most important change factor which can ameliorate the hardships faced by common people.
Institution building is, in another way too, most important factor affecting common people’s life. Human life may be compartmentalized into his activities and sentiments relating to performance of various institutions. How a person feels dealing with various institutions and how much these institutions come upto his expectation make a predominant portion of the person’s sentiments (happy or unpleasant) nurtured by him in his life. As a person’s sentiments determine his life quality, we may say life quality of a common person is predominantly relating to performance of social institutions. It is because of better performance of social institutions in western societies that our common people enjoy living in such societies though by means of menial jobs. Life quality of common people cannot be improved without positive/reformed social institutions. Institution building should be major focus of our ruling parties in Pakistan, if they want to improve life quality of common people.


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  7. Institution building within a system which itself is fundamentally flawed from its basis isn't a good idea at all. If more than 200 years of institution building couldn't remove poverty from the west and actually increased the wealth gap, then how can we expect to see results of similar efforts within the same system?

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