Institutional development in the era of economic policy reform: Concerns,contradictions and illustrations from Malawi

The article argues that the essence of economic policy reform programmes—both their substance and their pace—runs counter to the central notions of sound institutional development. Attention is first given to some fundamental concerns about the relationship between the two processes, in particular focusing on questions of culture, speed of change and the political environment. The article then provides some illustrations from Malawi, looking in turn at collateral institutional damage, the new generation of semiautonomous organizations, confusing incentives systems in the areas of salaries, housing and training, and lack of serious concern for the sustainability of the reforms. The conclusion calls for returning ‘part-ownership’ of the reform programme to the local officials, and trying to reduce some of the institutional unreality, which seems to adhere to the implementation of the reforms.