Chapter 11: From private to public: community institutions, corporate social action, and sustainable economic development
Despite decades of economic development aid to emerging economies and the hard work of multilateral organizations such as the World Bank and the African Development Bank, many communities throughout the world remain in poverty. We focus on these communities and the frequent failure of top-down interventions emanating from the public sector to spur development of these communities, which we interpret to suggest the need for private action to spur community economic development. To illustrate our point, we discuss two examples from the Middle East that demonstrate the contrast between top-down partnerships led by the public sector and bottom-up partnerships initiated by private actions. We suggest that a specific form of private action, corporate social action (CSA), may represent a good approach and suggest some ways that it can be more effective in triggering sustainable economic development in previously marginalized communities. To frame our recommendations, we apply a perspective based on social institutions at the community level, suggesting three categories of institutions that should be the focus of private efforts: cultural cognitive, social normative, and regulative institutions. We base our analysis on examples of how change to these categories of institutions has spurred the development of specific communities. Further, we suggest that the analysis of how private action can succeed in developing communities should start with cultural cognitive institutions, which constitute the cultural and mental architecture of the community. We make two specific recommendations for how private action can be more effective in changing ideas to spur economic development. First, we suggest increasing the number of private sector and community leaders involved in the economic development initiative. Second, we advocate that private actors maximize the diversity and quality of participation in this community change process.
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