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Description

Successful reform has to resolve two separate and conflicting dimensions: people and time. Reforms, by their very nature, challenge the status quo, often threatening those with a stake in the current system—from society's power brokers, to better-off stakeholders who may benefit unintentionally and disproportionately from a policy, through to the intended beneficiaries, even if the status quo is unsustainable over the long term. Their changed influence, incentives, and behavior, as a result of reforms, have to be managed, until the success of the reforms becomes apparent for both them and society more widely.

Time, too, has to be assuaged, in the sense that while technocrats may see cuts are needed in, say, subsidies because of a weak budget, the near-term negative effects on low-income groups will be on the minds of both those supporting the political status quo and reformers. And the technocrats know this, so we come full circle.

This is what the Asian Development Bank (ADB)—and many other development agencies—in an admittedly long process of trial and error have found out over more than 2 decades of supporting reforms. The more deeply these agencies became involved in reform efforts, the more they recognized that, although there is no blueprint for success, there are clues as to what may work in particular situations, and how the reform process can be better managed. This recognition and acceptance of the wider, political economy dimension of reforms began in ADB in the late 1990s and led to early work to better understand reform processes to improve reform outcomes.

The book's intended readers are development practitioners involved in the policy reform process. It aims to help them understand political economy factors that shape actual outcomes, and to simplify the complexities of policy reform and the loans and technical assistance that support such reform.

Contents

• Foreword
• A Framework for Political Economy of Policy Reform and Policy-Based Lending
• Political Economy of the Reformed Value-Added Tax in the Philippines
• Reforms in the Pacific
• Policy Reform in Viet Nam and the Asian Development Bank’s State-Owned Enterprise Reform and Corporate Governance Program Loan
• Assessing the Political Economy Factors Important for Economic Reform