Chapter 14 - The Informality Trap : Politics, Governance and Informal Institutions in South and Southeast Asia

Summary

Abstract

This essay focuses on an important similarity of the character of state-citizen interaction found across South and Southeast Asia: the dependency of citizens on personal connections to deal with state institutions. While the capacity of Asian states to penetrate society is growing, personal exchanges of favors through informal social networks often undermine the capacity of state institutions to implement policies and laws in an impersonal, rule-bound manner. As a result, South and Southeast Asian countries are sometimes described as “patronage democracies” because of the dependence of citizens on clientelistic exchanges with politicians to gain access to state benefits. This informality is often attributed to particular “Asian” cultural traits: in this view the pervasiveness of clientelism, identity politics, and the particularized implementation of state regulations are due to the importance that Asian citizens attach to personal obligations and norms of reciprocity. In this essay I develop an alternative explanation. I argue that the importance of personal exchange relations grew out of the particular colonial process of state formation that most Asian countries went through. As the state has generally been experienced as an alien and oppressive force, personal exchange relationships have been a stronger guarantee of personal security and welfare. As a result politics and governance in South and Southeast Asia are shaped by a massive collective action problem: while both citizens and power holders might prefer a rule-bound state and a strong rule of law, they would jeopardize their welfare, security and career if they ignored the obligations embedded in personal relationships.

Keywords: Informality; governance; clientelism; rule of law

For a brief moment in 2013, Hambit Binti was one of Indonesia's most famous politicians. This district head of Gunung Mas, a remote but resource-rich backwater in Central Kalimantan, made the headlines of all national newspapers. Yet the news was hardly flattering. Through a middleman Binti had bribed Akhil Mochtar, the chief justice of Indonesia's constitutional court. Binti had given Mochtar at least 250 thousand US dollars. The constitutional court was about to decide on the contested results of Gunung Mas’ recent district head elections. With the bribe Binti wanted to ensure that he would win another term as district head. Unfortunately for Binti, Indonesia's anti-corruption agency KPK had gotten wind of the deal.