The Key Role of Institutions for Human Development: A Response by Elisa Reis

A commentary on Ismail Serageldin’s essay: “Reflections on constructing a human-centred development paradigm” by Elisa Reis, Professor of Political Sociology at the Federal University of Rio de Janeiro, Brazil.

I found the think piece by Ismail Serageldin very inspiring. I strongly support and agree with his initial comments describing the importance of four types of capitals: Man-made, Natural capital, Human capital and Social capital. These categorization of different forms of capital is very useful to organize the issues we are to discuss, how to reframe human development to be more human-centric considering today’s challenges. My commentary focuses on the first on two forms of capital d: environment resources and social cohesion, as these two remain, in my view, under-studied components of human development.

But before I introduce my comments to Ismail Serageldin’s piece, I wish to make a short observation about Peter Gluckman’s commentary, Reflections on human potential and resilience, and in particular to his conceptualization of “human potential”. Gluckman claims that we should focus on the notion of human potential rather than on the idea of human capital.  I would support the adoption of this label, as long as reasons why such shift might be relevant are stated as a conceptual clarification. It is not an attempt to simply discard the concept of human capital, rather, we aim to build an integrated understanding of what is at stake in human development. To provide grounding on why such framing is more appropriate.

Clearly, human capital means something very different from ‘capital’ as understood in reference to quantified value. Similarly to cultural capital, the human value cannot be translated into monetary terms as it encompasses intangible goods, existential and symbolic components. Previous Human Development Reports have been addressing human capital as a multidimensional concept, integrating the aforementioned dimensions. Still, I think this conceptual clarification might be important so as to avoid misconception and misunderstanding for readers.

But, getting back to my own commentary to the two of the forms of capital addressing in Serageldin’s piece: environment resources and social cohesion.  At this point it does not seem relevant to discuss specific indicators for these two broad dimensions, however, I would like to stress the importance to adopt a stronger focus on institutions as something that impacts the development of such forms of capital. Why? Because as Max Weber stated, institutions, as modes of regulation for social interactions, are probabilities of specific human actions.1

For example, societies that explicitly commit themselves to adopt well defined measures and target to protect nature end up end up consolidating stable, valued and routine practices that protect the environment. The same argument applies for social cohesion. We know that social cohesion is based on values, beliefs and norms. But can these cultural factors be strengthened other than by consolidating beliefs and norms through the introduction of legal enactments and other forms of consolidating practices? Naturally, it is possible to be more concrete: laws to secure minorities rights, to punish violence against women, to enforce recycling, to ban polluting products, etc. all these are signals of expanded concern for human development. initiatives that set the grounds for institutionalization seem to be crucial to sediment human development.

More broadly, institutions are crucial to promote and consolidate human potential. In the absence of solid political institutions, the promotion and strengthening of the human potential, is susceptible to discontinuities and setbacks, with great individual and social costs. While this aspect is often taken for granted in societies that have well-established institutions and political stability, it is important to recall these two assets are often lacking in other parts of the world. There are societies that continue to experience loses in human development as a consequence of institutional weaknesses or collapse. In fact, institutional weakness can be both a cause and consequence of undermined social resilience. Resilience and social cohesion need institutional support to flourish.

Where I think social capital merges with income and wealth is in respect to inequality. Here it is the degree of inequality and not inequality per se that is relevant. When horizons of possibilities for advancement, upward mobility, become too disparate, the capacity for empathy and solidarity shrinks. The inability to share minimal components of a world view destroys social cohesion. When societies experience this lack of empathy and perception of shared problems, people tend to seek restricted or individualized ways to reach their goals. Illustrations of such phenomenon are, for instance, gated communities, private guards and other forms of individual protection against criminality instead of campaigning for better security policies. Social cohesion derives from the identification of shared interests, be they material or ideal. In the absence of these, wider social solidarity has no soil to grow.

Notes and further references

  1. Max Weber, Economy and Society, Vol. 1