The political economy of decision-making in forestry : using evidence and analysis for reform

The use of the phrase, ‘political economy’ originates in Adam Smith’s Wealth of Nations and is also found in the writings of David Ricardo and Karl Marx. What is presently understood as ‘economics’ was, at that time, termed ‘political economy’. This was understood to mean ‘conditions of production organization in nation-states’ (Acemoglu and Robinson, 2012, Beuran, Raballand and Kapoor, 2011). Venerable scholars such as Smith, Ricardo, Mills, Rosseau, Ruskin and de Tocqueville, took a consistently holistic view of the interaction between economics (technical means of production) and politics (relationships of production) in their debates on wealth, prosperity, and international trade, and explanations of development outcomes. However, subsequently, ‘economics’ and ‘political science’ developed along parallel tracks, constraining us from fully exploring their interactions and joint contribution to incomes, livelihoods and to economic development more generally. For the forestry sector too, when stakeholders’ power and influence is uneven, vested interests get to control the resource, and institutions are weak (or deliberately weakened by the same vested interests) the result is resource plunder, institutional erosion and breakdown of the rule of law and concentration of wealth in a few hands. (In the next section of this chapter, specific examples from forestry will illustrate these challenges clearly). If we are to come to grips with the fundamentals determining sustainable forest management, there is a need to develop a good understanding of stakeholder interests and the complex balance of power relationships, via political economy analysis. Thus, the major objective of this report is to offer preliminary guidance to conduct a practical political economy analysis for the forest sector. The report provides this guidance by considering eight ‘front-runner’ political economy analysis approaches that have emerged over the last few years. In principle all are capable of being applied to address political economy challenges in forestry and the report develops a set of criteria, geared to political economy considerations for forestry, which would assist a practitioner in selecting among the available approaches.