 So welcome everyone who is here with us for the chat session. My name is Michael Dankwa and I'm a research fellow at UNU Wider. We will have a chat with Professor Augustine Fosu from the University of Ghana and just as you've seen, we would talk about institutions and governance in sub-Saharan Africa. Many of you will know Professor Augustine Fosu, you know, he's worked at the AERC, he's worked for the UNECA, he's worked here at UNU Wider as well and just as you may know, he's done a lot of work in the subject that we would talk about today. One last thing I would add is that Augustine is also a very good mentor as well, he's a great mentor as well. So if you want to drop him a line, he would get back to you and offer you good cancer in that case. A couple of things, we would have the chat for what do you call it, 20 minutes and there are two things that you just have to note. We would want this to be as interactive as possible and so if you have any question, drop it in the Q&A chat or you can also read what you call it, a question and I would give you the opportunity to ask your question live in this case. So get involved and feel free to ask your questions as well. So let me start with you, with your prop, I mean you've done a lot of work in this area, in this area of institutions and African economies, institutions, economic governance and you know, human development. I was just going through some of the work that you have done, some of the AAE supplements with Robert Bates and Cole and some of the what do you call it, especially issues and all that that you have done. I just wanted to ask, I mean what have we learned with all these work, what are the key issues, what are some of the things that you would want to share with us? Thank you very much Michael, thanks for the nice introduction, again my name is Augustin Fosu and I'm speaking from University of Ghana, Lagoon in Ghana right now. You know, institutions have been around for many, many years, going all the way back in terms of importance of institutions generally speaking and for African countries the importance of institutions was realized following the dismal growth performance in the 1980s in particular in the late 1970s and you may recall that the Washington consensus was developed but then Roderick came around and said by the way, the Washington consensus has omitted an important aspect and that is the role of institutions. Hence we ended up the augmented Washington consensus which shows importance of institutions. The African Economic Research Consortium AERC also organized a project called Explain African Economic Growth called the Growth Project in short which also had a proposition that institutions were actually cynical and known when it comes to African growth and much of my work takes off from the work of the African Economic Research Consortium AERC where I found that indeed institutions are important in terms of preventing policy syndromes that is anti-growth policy syndromes and there are many of them. So the idea will be to have a regime called syndrome-free regime so the question becomes what influences a syndrome-free regime which would then lead us to more growth and improved development. So that is something that has been found already and the question becomes are there any institutional levels that we can pull to ensure that we have a greater prevalence of syndrome-free regimes? So that is where we are pretty much. All right so my what do you call the audience we would want to have your if you have any question please let me know you could put that in the Q&A chat or I could give you the opportunity also to access live as well. But Prof I mean coming back to the main discussion I mean we would want to dive down to look at what are the challenges of institutions in this case based on the on the syndrome-free approach that you did talk about. What are some of the things I mean what are some of the what do you call the barriers that sub-Saharan African countries may have to deal with in order to you know boost growth in this case? Yes obviously you know what are some of these syndromes in the case of having all kinds of regulation on the economy policy syndromes in terms of a state breakdown in terms of sub-optimal intratemporal decision-making and adverse redistribution. These are the policy syndromes that we need to do something about. So if you look at government what led many governments to end up effecting these policy syndromes and I contend that it is because many of these governments were free to free to act specifically the executive branch of government. So if a president wants an international airport based upon based in his hometown for example he has the power to do that even though that may be sub-optimal locational resources and something I would bring about a lot of inefficence. I could give you specific examples but I'm not going to do that in this conversation. So I'll make a more general statement. And so the question then becomes can we increase the constraint on the executive branch of government as a way of preventing these policy syndromes? And my recent work indicates that indeed as cons that this constraint on the executive may be an important lever that we can we can pull I mean to what it prevented the syndromes and if we were able to pull enough of it then you end up with a situation where you have the syndrome minimized and independently it would actually reduce syndrome free. It could also act to mitigate the pernicious effect of ethnicity. In terms of analysis actually you can have once again S-Cons increasing syndrome free prevalence and therefore increasing growth or can do that interactively in terms of reducing the potential pernicious effect of ethnicity and therefore improve the growth outcome. But I mean so apart from the constraint on the executive I mean that is maybe one thing that you've done you know some work on but in the in the context of sub-Saharan Africa what what what what do you call the factors come to mind apart from this? Looking at it from the context of sub-Saharan Africa. Yes actually my work is in the context of sub-Saharan Africa. Yeah. The AISC project was about sub-Saharan Africa, right? And obviously you have all kinds of institutions includes you know if you talk about developing governance developmental governance for example they need to to have what we call coherent economic policy situation as free market policies of having effective public service and having limited corruption and that is how sometimes developmental governance is defined. We try to start the once again S-Cons happens to be an important tool I mean to bring in to bring in about developmental governance. Yeah so you know in the front of us obviously it comes to promise of institutions and this is the work of Roderick and others which seems to indicate that institutions are primary in terms of trumping the effects of geography and integration. Yeah so in the final analysis the fundamental factor then in terms of influencing growth becomes institutions essentially and so the S-Cons actually is just one of these levers obviously rule of law is important poverty rights that's very important you know having political rights and so liberties that is you know quite crucial and so on and so on. So the question becomes then how can we influence I mean these you know kinds of variables that in turn influence the economic outcome in terms of growth and development. Right. Go ahead. Now a challenge becomes I know that people talk about whether indeed they should be democratic institutions or something else and strongly believe that it is it can be important in terms of bringing about growth and development. Yes it is true if you happen to get a benevolent dictator that benevolent dictator can bring about growth and development unfortunately benevolent dictatorship is not something that operates in the long run. In the short run yes but not in the long run people get corrupted over time essentially authority has a way of corrupting our leaders but yes if you can do that however it turns out that from sometimes having a long-term development growth and development require a democratic environment and a democratic framework I mean to do that. So the question then becomes how can we ensure that we have appropriate democratic dispensation to bring about development and you know some people actually point to China they say oh by the way the Chinese are not democratic but you know they do have strong economic development. Well first of all China is not Africa and secondly even the Communist Party itself at least happened to be democratic internally maybe until very recently but so in some sense there needs to be some democratic elements you know for us to have any type of long-term growth and development. So yes so now we come to democracy but there are the problems that are the side effects of democracy especially multi-party democracy and that's the fact that there's a tendency for the government to over commit in terms of providing perhaps local public goods not supposed to national public goods and they also end up perhaps not collecting enough taxes. Hence we end up with a situation where we have a huge budget deficit, a chronic budget deficit which can lead to huge debts in these economies and these are the challenges that we need to do something about if indeed you continue with the type of multi-party democracy. Okay excellent, I have one question here from Daniel Tatu and Daniel would you want to ask your what do you call the question live? No you can't even you can't even respond to me let me do that for you. So Daniel would want to know what are the what are the levers of effective constraints on the on the executive power? Let me take that again. What are the levers for effective constraints on executive power? For instance a significant weakness remain regarding the role of parliament especially if a majority of members belong to the same ruling party. That is a tough one, that's a really tough one because you will need to have enough checks and balances in the system and so if indeed you have a legislature that also belongs to the executive if you will then becomes quite difficult. I mean one potential solution is to have a situation where you have enough constraints built into the constitution right which is certainly limit the power of the chief executive without necessarily even having parliament come in to do that. So if the rules are there let's say that look the chief executive can nominate so many you know people to head offices etc they can they can actually choose districts commissioners in a very limited type of way then the chief executive in terms of executive branch of the government has no you know they really have no leverage but to abide by these types of rules. So it has to be built into the system somehow. We should also have a CSOS civil society organizations not rest and make sure that the government does the right thing. That's important media, the world media here is critical to ensure that the earth in any types of wrongdoings and you know bureaucratic messes, corruption, those kinds of issues and make sure that we take distance up and provide the appropriate critique and environment to ensure that the executive is properly. But following from this I mean so you've talked about the media and the CSOS and the work that they do I mean from my own experience I mean criticism the government is one thing I mean bringing things to the force one thing but how do they I mean you know it's like they talk they give they say what they have to say but nothing happens I mean you know so I mean is there another level of what you call something that can be done what is that gap there so that because the translation of some of these critiques and doesn't seem to get anywhere with their regards to countries in Sub-Saharan you know Africa. One potential solution Michael will be through decentralization. The major part of the problem is that the central government has too much power in terms of the power of the purse providing revenues for local public goods you know for example so if they were effective decentralization so the localities can raise their own revenues sufficiently and the center of cost sharing then I think the central government is more likely to behave yourself because it does not have that you know veto power when it comes to the appropriate revenues for localities to act so decentralization here becomes very critical in my view as a way of getting around the problem currently a lot of localities have so they have so-called expenditure autonomy but not revenue autonomy but with that revenue autonomy expenditure autonomy is not very viable in terms of implications for growth and development so if there were greater level decentralization we could then reduce the power and authority of the central government and therefore the executive branch of government and I think that will have go a long way in ensuring that the central government would indeed behave. Let me ask this question. I mean there are many of us here who are working on many other things but in case someone want to do something related to institutions, governance and let's say African what do you call it, economies what do you call the area would you want the person to focus on based on your expertise in that area what are some of the gaps in terms of research? One I think it would be important to have a better understanding of the workings of democracy and if indeed the multi-party democracy has practiced today is the best way to go or whether there should be some type of changes in the system somehow this issue the winner all kinds of policies because if a given party wins the election then obviously that party pretty much has free authority if you will overriding authority I mean to act to appoint heads of organizations and all kind of stuff but if there was some type of arrangement where they could divide up the pie if you will then that might be minimized so that's one way I mean to go to try to find out what would be the flow of the democratic type of government that would be more suitable another way would be to investigate the level decentralization I mean that would be the best way to go and extend to which for example the central government should subsidize education at the local level for example as you well know we are free SHS in Ghana right now and we also know that you know the fees that the students pay at the undergraduate level is quite minimal about $300 a year compared to $50,000 in the United States of America the point is this that if indeed individuals can get free lunch which you know doesn't exist in economics they'll go for it and so the various localities would they all be rivaling for the interest if you will for favors from the central government because they know that there's no cost sharing that is pretty much free lunch if they want on education situation they get it if they want clinic they get it if they want it is fairly free to some extent to what extent there should be some cost sharing to ensure that it would put a limit if you were constrained on your demands on the central government I think that's an important area I'm going to delve into many things we don't have that much but this is just I mean I'm just thinking in terms of what do you call it a prospect I mean with regards to okay I have what do you call it a question here from Daniel so I'll read that out for you there's what are your views on the state of play of governance in Africa should we see the the the coup d'etat in Mali and Guinea as dust as dust hiccups how should we view the situation in a place like Ethiopia for example where hundreds are dying virtually every week so this is this is from Daniel again Daniel thank you very much this is quite tough but you see if you read one of my papers where I talk about intermediate level democracy versus advanced level democracy in Africa you find that under the format that's intermediate level democracy this is where you're transitioning from dictatorship into democracy that is very treacherous so for example in the case of Ethiopia Ethiopia was doing quite reasonably well but pretty much under a high level of dictatorship if you will so now that the political space has opened up you have a certain amount of political you know political negative political type of situation where you have some challenges and obviously if that leads to government failure if you will or state breakdown that certainly will reduce the momentum to have greater growth and so on so yes so the point essentially is this that we should do whatever we can we can to prevent civil war to prevent state breakdown to prevent coup d'etat and so on other people have worked some of my own work indicates clearly that coup d'etat certainly is not a good mechanism when it comes to war to growth and development so we should do whatever you can to prevent these kinds of incidents occurring and certainly we should not encourage them at all now what democratic dispensation has done recently is to attend with these types of incidents because if people wait long enough four years whatever they can change the government if they do not like what the government is doing so if you look at the evidence it's quite clear that there has been attenuation of the incidents of these kinds of elite political instability and so on but so they may happen and whenever they do we should make sure that they are short-lived proper let me let me ask the last question is from is from Ann Wersha and this is the question do you think that in a highly literate country long run the taxation can become benevolent since literate people are aware of their rights and may topple down the government the short response the short response is no the short response is no because I'm sure that they want their political rights civil liberties they want your freedom and they wouldn't want anyone dictating to them so they would indeed vouch for democratic framework democratic dispensation alright many thanks Prof we are actually out of time so I would want to thank you for taking time to talk to us on this important subject matter and to everyone who joined us and for your brilliant questions as well so many thanks Prof and it was great to see you my pleasure Michael thank you very much for giving the opportunity and it's great to see you as well and I thank everyone for participating