Systemic approaches to development have, over the last decade, gone from a niche concern to what is arguably a paradigm shift, in discourse at least. In academia, the
global value chains literature has shifted focus to align behind global production
networks literature in being more inclusive of the multidirectional flows and
institutional dynamics of systems (Hess and Yeung, 2006; Coe et al., 2008; Bair,
2008). In practice, donors have begun to align behind systemic approaches demonstrated by USAID’s shift from Value Chains to Value Chain Systems (USAID, 2014)
and the £1 bn of programmes commissioned under a systems banner over the past
decade (authors’ analysis of programme documents). The systemic approach to
development intervention is grounded in the works of Polanyi, Porter and New
Institutional Economics, and has analytical synergies with work on complex
adaptive systems (Hall and Clark, 2010; Ramalingam et al., 2008, 2014). However,
this journal has played a significant role in the conceptual development of the
operational side of market system approaches, and their principal articulation,
Making Markets Work for the Poor (M4P) (Elliott et al., 2008; Bear et al., 2003; Hitchins
et al., 2004; Taylor, 2013; Bekkers, 2008; Bear and Field, 2008; Jones, 2012; Hitchins
and Jain, 2011; Johnson, 2009), codified in the Operational Guide (DfID and SDC,
2008; Springfield Centre, 2015).
Fundamentally, the consensus which has emerged relates to the objective of
ensuring that approaches to addressing development goals including poverty
reduction, improved nutrition, and gender equity, achieve sustainable (Taylor, 2014)
impacts at scale. A ‘system’ or ‘market system’ centres on a series of interconnected
supply–demand transactions, each of which is supported by other functions and
governed by formal and informal rules. Each of the supporting functions and rules
as well as the roles of supply and demand are performed by a range of public,
private, and civil society actors. The concept of a market is useful as it highlights
the generation of outcomes through the incentives of the different players
involved. However, these incentives go beyond economic incentives to include
social and political motivations, and the markets terminology may be part of the
reason behind the confinement of systems thinking to productive sectors, which
this issue seeks to address. The paradigm emerged from some early development in
financial services and quickly spread into a number of primary production-focused
agricultural sectors. However, some of the sectors that have the greatest impact on
the lives of the poor, and where the most donor money has been directed, have
not embraced a systemic approach in the same way despite experiencing some of
the greatest challenges to sustainability and scale of impact. This issue examines the systems of provision for health, education, water, and financial services from
a market systems perspective; in doing so it steps into new territory, tackling some
important, and perhaps contentious, issues.
Three of the papers included in this issue examine systems in health, education,
and water which have received significant donor money for many decades. The
papers examine the evidence on how effective these interventions have been and
find that results have been, at best, mixed. The papers bring to light a critical issue in
intervention design: a predetermined focus both on the recipients of funding – often
public sector organizations already involved in the delivery of poor outcomes or
international organizations that are temporary and external to the system – and on
the method for delivery – commonly direct transfer of funds, hardware, or training.
The papers on health and education apply case studies to examine how a more
systemic approach could overcome some of the challenges faced by traditional
approaches. Bourque and Mitchell then use the appraisal of previous programming
as a departure point for a more practical consideration of how a systemic programme
in the water sector might be designed.
There are other important contributions made by these papers which are of
relevance to the wider literature on systemic approaches for development. Lomax’s
paper looks at systems of treatment and systems of transmission in health. This
characterization provides a lens which might be employed elsewhere to understand
where a development programme might want to lessen or eliminate a transaction.
Ordinarily, intervention in market systems seeks improved price, quality, or quantity
of a given transaction with respect to the poor, where the poor engage in the market
as either suppliers or consumers, whether the transaction involves agricultural
goods, healthcare services, or the right to vote. Here, the paper presents a way of
understanding situations where a positive developmental outcome is realized by
disrupting this transaction, and the ‘supporting functions and rules’ are things
which perpetuate the negative outcomes currently being realized.
Taylor et al.’s paper on the education system in Nigeria provides a useful and
generalizable five-point framework for understanding the rationale and objectives
of donors intervening in systems. Cognizance of these dynamics allows funders
to make an honest appraisal of what they hope to achieve by pursuing a given
type of intervention and, through the example presented on education, how taking
different approaches to intervention might deliver against these mixed and often
Over a decade after a systemic approach to financial sector development was
first applied programmatically, Porteous and Zollman re-examine work in the sector
to date for the final paper of this issue. While systemic programmes may have
focused on finance, they have not, the authors argue, gone beyond simple product focused markets which aim only to deliver products to people, rather than ensuring
that they are utilized or that these products change other behaviours culminating
in poverty reduction. In doing so, the authors argue for what is effectively a new
sectoral focus for systemic approaches on financial health. In common with the
other papers in the issue, this necessitates a broader and less dogmatic focus
including the provision of a number of merit goods; in this case household level financial literacy, regulation, and the role of civil society. The result of this shift
in focus is an extension of the theory of change beyond access to finance – which
is commonly where programmes stop their measurement efforts – towards welfare
changes and an example of how a methodology for measuring these welfare
changes might be employed.
The contributions to this issue argue that the focus of development to date on
who should perform a function or enforce a rule rather than what that role should
be and how it might perform better is one of the primary reasons for the challenges
to sustainability and scale of impact. Overall, this issue represents a significant
contribution to the literature on new directions in development programming. The
broad scope of the issue allows for general reflection on the purpose of development
aid and how it might be used to deliver more sustainable and larger-scale outcomes
to improve the lives of poor people.
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* this article was published as Taylor, B. & Donovan, J., 2016, Editorial: New approaches to old problems: systemic change as a unifying objective, Journal of Enterprise Development and Microfinance 27(1).