Crucial Needs, Weak Incentives: Social Sector Reform, Democratization, and Globalization in Latin America (review)

As its title suggests, this volume is about very important issues that have not been addressed well by most governments. The "needs" for social sector reform are great, especially in Latin America, and the political "incentives" for reform are usually insufficient for the task.

Much writing on social sector reform focuses on the technical details of the reform packages themselves: what types of health financing changes have made the systems more efficient and of higher quality? What changes in community control of schools have improved the attendance of teachers and the retention rate of students? This literature is widely distributed by donors such as the World Bank, WHO, UNICEF, and USAID and is widely read by academics, consultants, and even some policymakers. The Kaufman and Nelson volume contains some of the most recent thinking and writing on these technical issues. It makes an even more important contribution, however: it focuses on the political processes involved in those technical reform programs. This is an area that is often ignored and one that is probably the most crucial to the success of the reform efforts. While public health and education expertise and economics can help us understand some of the likely effects of changing health and education system structures, financing, and payment mechanisms, politics will tell us whether those changes will be adopted and, perhaps more important, implemented and sustained over time.

Crucial Needs, Weak Incentives is a compendium of 12 cases of significant reform efforts in health and education in 8 countries in Latin America. The editors led a thoughtful and intensive effort, engaging separate researchers for each case and shaping the accounts into relatively comparable reviews of each country and sector reform experiences. Unlike many edited volumes, this is a labor of iterative exchange, involving intense seminars with all the authors at the Latin American Program of Washington's Woodrow Wilson Center in 2002 (full disclosure: I participated in one of those seminars). From these case studies, along with their own deep experience with the issues, the editors draw comparative conclusions for reforms in the health and education sectors separately and an overall conclusion on the dynamics of reform efforts in general.

The introduction presents a compelling case for the importance of reform in both health and education sectors in Latin America, stressing the recent academic work that shows the clear relationship between economic development and improvements in health and education. It also emphasizes the inequities and poor quality of the existing health and education systems and their inefficiencies in terms of investments in high technology health care and higher education rather than more effective basic health care and basic education. To set the context for examining the proposed reforms in each sector, the editors introduce the broader political environment of increasingly democratic regimes and the international donors, which are more proactive in the social sectors than they were in the past. The center of the analysis, however, is the processes of reform: the stakeholders and their interests and interactions, the types of reform (incremental small steps as opposed to extensive reforms), the processes in the policy cycle, and comparisons between health and education sectors.

In keeping with the book's title, the editors emphasize the strength of those political actors and stakeholders, such as professional associations and unions, hospitals, and universities, which are established and have an interest in maintaining the system. They contrast that strength with the difficulty of mobilizing support for changes that benefit weaker and less well organized groups, such as the poor, underserved, and vulnerable. This analysis is not new; it is repeated in almost all political analyses of social sector reforms. But it is well presented and documented throughout the volume. The editors also point to two additional key factors: the broader democratic and constitutional reforms that put equity and access on the policy agenda...