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== Role Of Knowledge And Technology In Development ==
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A thesis submitted to the faculty of San Francisco State University In partial fulfillment of The requirements for The degree


== a ==
Master of Arts In International Relations



by

Ricardo Valverde

San Francisco, California

May 2005 Copyright by Ricardo Valverde 2005 CERTIFICATION OF APPROVAL



I certify that I have read Role of knowledge and technology

in development by Ricardo Valverde, and that in my

opinion this work meets the criteria for approving a thesis

submitted in partial fulfillment of the requirements for the

degree: Master of Arts in International Relations at San

Francisco State University

== b ==

Raymond Miller Professor of International Relations



James Quesada Professor of Anthropology ROLE OF KNOWLEDGE AND TECHNOLOGY IN DEVELOPMENT



Ricardo Valverde San Francisco State University 2004

== a ==

Abstract

Technology is widely considered one of the major engines of development, both outside

and inside the field of development. Development interventions make use of specific

types of technology to reach their goals. In many cases several technological solutions

are considered, and then one of them is selected. This thesis is concerned with the

decision-making process regarding the choice in development interventions: when is the

decision made, by whom, and following what criteria?

The study examines first the general planning and evaluation of development projects and

second the appraisal of alternative techniques as described by major actors in the field of

development. To illustrate the application of the general principles, the thesis reviews a

set of reports on actual World Bank projects in the energy sector. The results of the study

show that the economic perspective is still by far the most important in the appraisal of

development interventions, and that a serious consideration of technological alternatives

is often missing.



I certify that the Abstract is a correct representation of the contents of this thesis.

__________________________________________ ________________ Chair, Thesis Committee Date ACKNOWLEDGMENTS



I would like to thank Professors Ray Miller and James Quesada for

their guidance, especially during the last stages of the completion

of this work. Also thanks to Professor Stanley Bailis for a

wonderful class and the imprint of interdisciplinarity it left on me.

And thanks to Professor Glenn Fieldman for her encouragement

and friendship.

Finally, and most importantly, thank you Natalia for walking with

me all this time, and for poking me when it was necessary.



Para Jesús, Ester, y Ariadna. Es su futuro lo que nos estamos

jugando.


== o ==
v TABLE OF CONTENTS



LIST OF TABLES ...................................................................................................... viii

LIST OF FIGURES ...................................................................................................... ix

== 1. Introduction.......................................................................................................1 ==
== 2. Technology, Society, And Development .............................................8 ==
Knowledge, technology, power and development ................................................8

Definition of technology......................................................................................11

Development and the field of development.........................................................12

Main Framework .................................................................................................15

Different perspectives..........................................................................................18

Conclusion...........................................................................................................44

== 3. Development Interventions ....................................................................45 ==
What is a development project? ..........................................................................46

Project Cycle .......................................................................................................48

Stakeholder Analysis ...........................................................................................54

== 4. Choices In Development Interventions: Project ==
== Analysis And Appraisal ==
Continuing with our search for answers to the three questions regarding the choice of

technology in development interventions –when, by whom, and following what criteria—

we will look into how projects are appraised, what are the tools and techniques used, and

the criteria for the selection of one solution among several alternatives.

Planning and managing projects: Objective Oriented Project Planning and

the Logical Framework

Before looking at the assessment processes and techniques, let us look briefly at the

methods commonly used for project planning and management. There are two main

approaches that are often used complementarily: Objective Oriented Project Planning

(OOPP) and the Logical Framework.

Objective Oriented Project Planning (OOPP)

The Objective Oriented Project Planning approach was originally conceived by the

German aid agency (GTZ), and is often referred to by its German acronym, ZOPP. It

helps in the generation, organization and development of ideas for projects by providing a

systematic way to work with them.

OOPP is centered on the problem situation and helps with the elucidation of its

causes and effects. The method is designed to achieve the definition of the objectives of a

project with the involvement of the direct beneficiaries, improving the communication 76

== e ==

among the actors involved and trying to integrate project planning and implementation.

OOPP includes four major steps explained below.

# Participation Analysis

This first step consists basically in what was described in the previous chapter as

stakeholder analysis. All the actors –individuals, groups, institutions, etc— involved one

way or another in the project are identified, categorized, and their interests, degree of

importance and of influence regarding the project analyzed.

The participation analysis allows the identification of potential conflicts among

parties involved, and the definition of a strategy of participation for all the stakeholders.

# Problem Analysis

The second step includes the identification of the major problems and causal

relationship among them –causes and effects. First, there must agreement on what the

central problem is, which will be stated as a negative condition. From there a tree will be

built with all the ramifications of causes and effects as shown in Figure 7 below,

reproduced from NORAD’s handbook for objective-oriented planning (NORAD, 1990).

It is important that the causes and effects tree is built with the maximum consensus

from all the stakeholders involved. The visual relationship between the core problem and

its causes and effects helps determine specific measures that might be taken to solve the

problems identified. 77

== eu ==

Figure 7: Problem tree in Objective Oriented Project Planning



# Objectives Analysis

The third step is the generation of objectives from the analysis of the problem tree.

NORAD recommends the transformation of the problem tree into an objectives tree by

restating the problems (negative statements) as objectives (positive statements) to be

achieved. This process basically transforms the cause-effect relationships into means-

ends relationships, generating a hierarchy of objectives and a desirable future, which will 78



be reached when the problems are solved. It is necessary to review the final objectives

tree that has been generated using this process to ensure that in every means-end

relationship the stated means are realistically sufficient to reach the end.

# Alternatives Analysis

The fourth step in the OOPP is the analysis of alternatives, where all the alternative

ways to reach the set of objectives should be considered. This part is very important from

our point of view since potential technological alternatives would be taken into account

here. This process should be done as early as possible in the project planning process,

definitely during the identification and formulation phases, in order to give all the

alternatives a fair chance of being chosen.

According to NORAD’s handbook on OOPP, the analysis is done by identifying

alternative means-end branches in the objectives tree that can lead to the achievement of

the goals. The list of alternative branches should be generated and discussed with the

participation of as many stakeholders as possible in order to assess whose interests would

be affected and how by going through one path or another.

Once the list of options has been generated, a first filter will eliminate those with

undesirable or unachievable objectives, and those with objectives that are pursued by

other projects in the area.

In order to select the best alternative, NORAD recommends that the following

criteria are always used: 79


== ii ==

* Total cost 
* Benefits to priority groups 
* Probability of achieving objectives 
* Social risks And suggests some other criteria that might be used:


* Technical: Appropriateness, use of local resources, market suitability, etc. 
* Financial: Costs, financial sustainability, foreign exchange needs, etc. 
* Economic: Economic return, cost effectiveness, etc. 
* Institutional: Capacity, capability, technical assistance 
* Social/distributional: Distribution of costs and benefits, gender issues, socio-cultural constraints, local involvement and motivation, etc. 
* Environmental: Environmental effects, environmental costs vs. benefits (NORAD, 1990).

The assessment of the different alternatives and how well they do vis a vis the above

mentioned criteria should lead to the selection of the best project strategy.

The next step defined by NORAD in its handbook for OOPP is the completion of

what they call project matrix (PM). This is the name NORAD uses for their particular

adaptation of the commonly used Logical Framework, described below.

Logical Framework

The Logical Framework was originally designed for the US Agency for International

Development (USAID), independently from the OOPP. Nevertheless, its ability to

synthesize in a very systematic way the main components of a development project,

avoiding the all too common confusions between means and ends that took place under

the OOPP approach, led to its adoption and adaptation by many of the most important 80

== iid ==

bilateral agencies. NORAD, as many others, uses OOPP and the Logical Framework in a

complementary fashion (NORAD, 1990).

The Logical Framework is based on a four by four matrix, an example of which is

provided by Potts as reproduced in Table 10 (Potts, 2002: 32).

== d ==

Table 10: Logical Framework Matrix


== h ==
The column on the left contains the main information about the project obtained

from the final project tree. The first row –the highest level— is the program or sector

goal, what NORAD calls the development objective. The second level is the purpose of 81



the project, or immediate objective, which is the contribution of the project to the overall

development objective.

The third level lists the specific outputs generated by the project; these expected

results should make possible the achievement of the immediate objective. According to

NORAD, the project management should be able to guarantee the outputs of the project,

but the actual achievement of the immediate objective is beyond their direct control.

The fourth level, according to Potts, is that of inputs. It includes resources such as

goods and services required for the execution of the project, as well as activities that must

be undertaken. NORAD’s version includes two different rows, a fourth level for activities

and a fifth level for inputs— goods and services.

The second and third columns of the Logical Framework are one of the keys of its

philosophy. There must be a way to measure, to obtain feedback, at different stages of its

implementation, in order to know whether the project actually works as planned. It must

be possible to know if the goals are being reached, the expected outputs generated, and

the necessary inputs obtained. This will allow the adjustment of the project as it unfolds

and the learning of valuable lessons for future projects.

The second column lists the Objectively verifiable indicators for each one of the four

levels, that is, means of measurement of the progress of the project. The indicators must

be verifiable, which often means they must be quantifiable. The third column, according

to Potts, is the Means of verification. It basically describes the sources that can be used to

obtain information about the indicators. 82

== t ==

NORAD would call the second column direct indicators and the third column

indirect indicators.

The fourth column in the matrix includes the assumptions made about the external

environment of the project. The assumptions are listed at each one of the four levels; they

are necessary for the progress of the project, but are out of the control of the project

management. During the identification and formulation phases it is crucial to assess how

important and realistic the assumptions are in order to know the chances of project

success.

The OOPP and the Logical Framework have been briefly described here with the

idea of providing enough background information to continue with our analysis.

Additional information and details can be found in the references cited above from Potts

and NORAD. In addition to that, a complete example of the use of OOPP and the Logical

Framework in an actual project is provided by Potts in his book Project Planning and

Analysis for Development (Potts, 2002: 38-46).

For the main concern of this thesis, the decisions regarding the choice of technology,

the most important part is the alternatives analysis included in the OOPP. By the time the

Logical Framework is applied, the main strategy of the project has been defined already,

and therefore decisions regarding alternative paths, including alternative technological

solutions, have been made already –although the Logical Framework approach would in

theory allow for adjustments of those choices on the fly. 83



The rest of this chapter is dedicated to the techniques used to evaluate the different

alternatives, to compare their performances with the project objectives in mind, and to

eventually select the best one amongst them.

It is important at this point to notice the difference between the feasibility and

desirability of a project. A specific project is feasible if it is possible to do it, and to

achieve the stated goals in the process. The answer of a feasibility analysis for a project

would normally be either yes –provided the assumptions are true— or no. Some typical

things that need to be checked in order to find out whether a project is feasible are: the

technical design meets the criteria specified and the workforce and management has the

necessary technical skills; the required finance is available and financial commitments

can be met; the environmental impact of the project falls within legal limits; from an

institutional point of view the implementing agencies have the authority and motivation

to perform the roles assigned; from a social point of view the project is acceptable under

existing laws and social norms; the project is consistent with government policies and

plans (Potts, 2002: 48).

If a project is feasible that means it can be done, and the stated main objectives can

be reached. The next question is whether it is desirable or, most likely, whether it is more

desirable than other projects (alternative options) that can fulfill the same stated goals.

All said, oftentimes the line between feasibility and desirability is not clearly defined in

the analysis of a project. 84

== n ==

There are several common tools or techniques used to assess the desirability –some

of them are used also for feasibility analysis— of development projects. Some of them

are standard tools used in project analysis in general, while others are more specific to

development projects. Some of them are used in virtually every project, while others are

less common.

In the next sections of this chapter we explore these tools and techniques having in

mind our interest in decisions regarding the choice of technology.

Cost-benefit analysis

Cost benefit analysis (CBA) is a tool commonly used for the analysis of the

worthiness of an action –an activity, a program, a project, etc— that requires investment

of some kind (financial or otherwise). It analyzes the current and expected future costs of

the undertaking and compares them with the expected benefits obtained from it, in order

to see if it is worthwhile –benefits should exceed costs. CBA is applied in almost every

development intervention, especially when foreign donors are involved.

CBA can be used to analyze the desirability of a project from the point of view of the

investor –financial analysis— or from a wider regional or national perspective –economic

analysis. The latter is the case in the analysis done for development interventions, where

CBA is used to analyze the project from an economic perspective. Nevertheless, as we

will see below, some adaptations allow for the inclusion of some social and

environmental questions into CBA. 85

== s ==

CBA typically starts with the calculation of cash flows for every year of the expected

project life. Typical benefits for commercial projects come from revenue sales, while

typical cost categories include investment costs, cost of operation –fixed and variable

(tied to the output level)—, and working capital –capital tied and necessary for the

normal operation of the project, like stocks of raw materials or finished products in a

production facility. The difference between benefits and costs for each year of operation

is the net benefit.

All those values, since they occur in the future, have to be converted into equivalent

present values (time value of money) using a common tool of accounting and financial

analysis, the discount factor (based on the concept of compound interest)7. The discount

factor has to be estimated for each project, and is typically close to the estimated cost of

capital –the interest rate— in the country of implementation –at least for commercial

projects.

All the benefits and costs are converted to present values (PV). The difference

between present values of benefits and costs is called net present value (NPV), and is

== q ==

7 Any decent book on project analysis, accounting, or financial management can be consulted for detailed information on concepts like discount rates, Net Present Value (NPV), Internal Rate of Return (IRR), etc. See for example Potts or Heitger Lester E. Heitger, Pekin Ogan, and Serge Matulich, Cost Accounting, 2nd ed. (Cincinnati, Ohio: College Division, South-Western Pub. Co., 1992), David Potts, Project Planning and Analysis for Development (Boulder, CO: Lynne Rienner Pub., 2002).. 86


== j ==
used to assess if the project is worthwhile –a positive value indicates that discounted

benefits exceed discounted costs.

Another typical value used to evaluate the worthiness of a project is the internal rate

of return (IRR). It is the rate at which the present value of benefits and costs would be

equal (NPV=0). A project would be worthwhile if the IRR is bigger than the estimated

discount rate. Other instruments of investment analysis are often used, such as cost-

benefit ratio (CBR) and sensitivity analysis.

The details about the calculation of all these values and its specific use are beyond

the scope of this thesis. Nevertheless, it is important to understand that for the CBA

analysis to work, all the benefits and costs of a project have to be measurable, and

translated into monetary terms. This is normally possible for commercial projects such as

for example a textile production facility, but it is not the case in many development

interventions.

Some of the problems of using analysis of commercial profitability –CBA

calculation of benefits and costs at market prices— in development projects were

described in Guidelines for Project Evaluation (1972), an excellent work published by

UNIDO (United Nations Industrial Development Organization) –rather old now, but not

outdated. These include:


* Dealing with distributional issues: market prices do not adequately represent social

welfare 87


== k ==

* Externalities: negative such as pollution or positive such as workforce training from a

production facility


* Consumer “surplus”: the difference between what consumers are willing to pay and

what they actually pay


* The calculation of the rate of discount – the authors talk about a social rate for

development projects that often differs, is smaller, than the commercial rate of

discount based on the price of money (Dasgupta, et al., 1972: 22-24).

The authors of UNIDO’s guidelines acknowledge that the problems arise from the

use of a tool, marginal analysis, which is based on a theory –neoclassical theory— that

“justifies, even deifies, commercial profits as an index of social as well as private

welfare” (Dasgupta, et al., 1972: 244). Although they disagree with the relevancy of

neoclassical theory in social issues (or at least they did in 1972), they still proposed the

use of a modified version of the tool, marginal analysis, in their methodology of social

benefit-cost analysis.

In their proposal the values that in the neoclassical model are determined in the

market place –prices— should be estimated by the project or national level planner,

therefore correcting market prices to reflect social values –shadow prices—, including the

consideration of distributional issues and merit-want questions –such as the preference

for alternatives that require less foreign exchange. Different weights would be assigned to

income generated by different groups or regions, compensating those that are

disadvantaged. Put this way it sounds easy, but the authors themselves recognize that the 88

== x ==

problem with this approach is to find who will “bell the cat” (Dasgupta, et al., 1972: 247).

According to them, it should be the political leadership that assigns the weights, but it is

not likely that they would do it. Therefore, they propose a bottom-up approach where it is

project formulators and evaluators who should take the initiative and propose weighted

alternatives on a case by case basis to the politicians, and force them to make political

decisions having those weighted alternatives in mind, therefore taking responsibility

instead of shielding themselves with the argument that decisions are made based only on

technical grounds. Nevertheless, this kind of proposal would not have many defenders

nowadays in the mainstream, although it would certainly appreciated among supporters

of ecological economics such as Herman Daly (Daly, 1996).

More recent works by Potts and White (Potts, 2002; White, 1998) offer several

proposals to account for project benefits not realized through sales revenue. Both Potts

and White cite the example of an infrastructure project such as road improvement, in

which benefits can be calculated through savings in vehicle operating costs (Potts, 2002:

185; White, 1998: 325). Similarly, for an energy project where one source of energy is

substituted for another, such as households using electricity as opposed to kerosene for

lighting, benefits from the project can be partly obtained from savings in the cost of the

old energy source. If there is no energy substitution, but instead an improvement in the

electricity grid that leads to increased energy use, the benefit can be calculated through

consumer surplus: the value to users of the good or service provided over and above what

they would have been willing to pay (Potts, 2002: 179). 89

== a ==

In all the examples cited above, the project benefits are calculated in monetary terms

and therefore, leaving aside the question of the adequacy of the monetary estimation, can

be included in the standard cost-benefit analysis. But what happens in cases where it is

not possible to assign a monetary value to the benefits?

For example, in water supply and sanitation projects, health projects, and education

projects, it is very difficult to assess the benefits in monetary terms. When benefits from a

project take the form of health improvements, there are approaches that assign a

monetary value through the calculation of loss of earnings from sickness and premature

death, or a direct monetary valuation of human life. These methods are controversial and

not often used.

For improvements in education the human capital approach is sometimes used

(Potts, 2002: 195). The monetary value of education or training is calculated through an

estimation of the difference in earnings between somebody that has received the

education or training, and somebody that has not. This approach is very difficult to apply

in practice –requires a lot of data over an extended period of time— and is not applicable

when the connection between the education or training and the level of earnings is not

clear, such as in primary and secondary education projects.

When monetary values for benefits are difficult or impossible to obtain, non-

monetary indicators are suggested. For health benefits it is possible to measure mortality

rates and morbidity rates. Common indicators used include years of life gained (YLG),

healthy years of life gained (HYLG), and disability adjusted life years (DALY) (Asian 90

== a ==

Development Bank, 2000: 45-53). Indicators for general education benefits include

number of years spent in school –controversial because it does not measure the outcome,

how much is learned—, and measures of literacy and numeracy.

However, these nonmonetary indicators cannot be used in the standard cost-benefits

analysis. A different tool of economic analysis is used with them, called cost-

effectiveness analysis (CEA). CEA can be used when there are two or more alternative

ways to achieve a set of goals. In this situation CEA facilitates the comparison of costs

and the level of achievement of goals amongst them, leading to the selection of the best

option. Costs are calculated as in CBA, but benefits (effectiveness), are derived from the

non-monetary indicators.

There are two approaches to CEA. In the first one the tool helps figure out which

alternative obtains the most effectiveness –let us say the bigger value of HYLG— for a

fixed cost. In the second one the idea is to see which alternative offers the lowest cost to

achieve a fixed effectiveness –for example a predetermined value of HYLG. Good

explanations and details about CEA can be found in English (English, 1968) and

Fabrycky (Fabrycky and Blanchard, 1991).

Recent works on the subject such as Potts’ do not offer much new with respect to the

old UNIDO guidelines regarding the consideration of distributional issues in the cost-

benefits analysis of projects. Proposals to deal with them include the disagreggation of

benefits and costs into relevantly chosen groups of stakeholders –for example unskilled

workers, farmers, landowners, etc –and a subsequent political evaluation of the results; or 91

== a ==

the assignment of different weights to the benefits and costs of different groups, which

involves a mostly subjective judgment (Potts, 2002: 272-82).

In summary, the commonly used tool of CBA is very powerful for the economic

analysis of development projects, but it is necessary to recognize that it is limited to just

that: economic analysis. Although it is able to incorporate to some extent distributional

questions, the validity of the distributional analysis obtained that way is often questioned.

Besides, not all social questions involved in a development intervention have to do with

distribution.

Social analysis

We have seen that cost benefit analysis cannot be expected to do more than an

economic assessment. This section discusses how social issues can be brought into

judgments about development interventions. Terms such as social analysis or social

impact assessment are commonly used by organizations involved in development to refer

to the analysis of how people affect, and are affected by, development interventions.

In its Social Analysis Sourcebook (2003) the World Bank defines five “entry points”

that should be used to structure the social analysis work in development interventions:

social diversity and gender; institutions, rules and behavior; stakeholders; participation;

and social risk (World Bank, 2003). This work includes a socio-cultural “mapping” of the

population affected by, and affecting, the project: how people are organized into different 92

== a ==

social groups, based on ethnicity, clan, gender, locality, language, class, or status; what

are the public and private institutions, norms, values, behavior, and formal organizations.

Part of that information can be provided by previous studies at the level of the

country, the region, or specific sectors –ESW (Economic and Sector Work). The rest of

the information is related to the particular development intervention and should be

collected specifically for it.

According to the World Bank’s manual on participatory tools and techniques the

main questions explored in the social analysis of a particular intervention are:

What will be the impact of the project on the various stakeholders, particularly women and vulnerable groups? Are there plans to mitigate adverse impacts?

What social risks might affect project or program success?

What institutional arrangements are needed for participation and project delivery? Are there adequate plans to build the capacity required at the appropriate levels? (Rietbergen- McCracken, et al., 1997: 20)

Figure 8 below has been reproduced from the World Bank’s manual and represents

the different steps of the social assessment process according to the Bank. The first step

of course is to know who is affected by the project and who can affect the project. This is

what we call stakeholder analysis and was described in the previous chapter. 93


== a ==
Figure 8: Social Assessment process according to the World Bank

== Rrrr ==

Once the main actors are known social factors must be identified, that is, the relevant

social issues that may affect or be affected by the project. At this stage it is necessary to

gather information about the affected population, including economic and social data and

more qualitative information about social structures, cultures, and stances towards the

project.

Some of the important issues to have in mind are: distributional issues, including the

effects of the project on the incomes of different groups, and the definition of the groups

themselves –considering not only income level but also variables such as gender, social

status, and ethnicity; motivations of the different stakeholders and potential conflicts;

consideration of the effects on the most vulnerable people; institutional structure,

including roles, degree of authority and legitimacy, and allegiances to stakeholders. 94

== Rrrr ==

Participation and public involvement are very important for a proper social

assessment. There is no way to analyze the social impact of a development intervention

without interaction with the affected population. Especially during the data gathering

process local involvement is key for obtaining relevant and meaningful information.

The data collected should then be analyzed and used to develop plans for the

intervention. According to the Bank’s manual, these plans should be developed in

consultation with stakeholders, which for the Bank means discussing the findings with

the affected people to “ensure that conclusions and recommendations are appropriate”

(Rietbergen-McCracken and Narayan-Parker, 1998: 23). Although the Bank emphasizes

the importance of participation all over in its document, it seems to use a very limited

interpretation of it, meaning consultation but not empowerment.

Other authors suggest that the information gathered be used in conjunction with

potential alternatives that had been identified –recall the alternatives analysis included in

OOPP and described earlier in this chapter— and together with stakeholders find the best

option and define potential mitigating actions to minimize negative effects (Potts, 2002:

295). This seems to be a more open and flexible approach than the one suggested by the

Bank.

Another tool often used is the Participatory Rural Appraisal (PRA), a set of

participatory approaches and methods that focus on local knowledge and the participation

of local people in the gathering of information, appraisal, analysis and planning for

development interventions. It has been used since the 1980s by organizations involved in 95

== Rrrr ==

development, first NGOs and later multilateral and bilateral agencies. PRA techniques

are used today in a variety of settings, not only rural, and include group animation and

exercises to facilitate information sharing, analysis, and action among stakeholders,

allowing local people, government officials and development professionals to work

together. PRA is widely used for social assessment, and it is specifically recommended

by the World Bank. More information about PRA can be found in the following

references (Chambers, 1992; Rietbergen-McCracken, et al., 1997; Theis, et al., 1991).

The review of social analysis in development interventions presented in this section

is mainly focused on World Bank procedures, and it is good as an example of how the

major bilateral and multilateral aid agencies deal with the social dimension in

development projects.

Although –at least on paper— there is obviously an effort by the World Bank and

other major aid agencies to seriously take into consideration the social issues surrounding

development interventions, one still has the feeling that while economic analysis is

consistently and systematically applied, and used as criteria to decide whether a project is

worthwhile undertaking, social analysis seems to be less crucial and often used only to

refine projects the worthiness of which has already been decided. In the next chapter we

will look at some factual information from World Bank documents and other sources that

supports this impression. 96

== Rrrr ==

Environmental analysis

One very important aspect to consider in development interventions is the

environmental dimension. What are we referring to? Any development intervention, any

project for that matter, does not take place in a vacuum. It takes place in a specific

“environment,” which broadly understood would include all types of conditions

encompassing human activities. In the field of development environment is commonly

understood as either the social and natural conditions, or only the natural conditions.

There is an on-going debate as to whether social and natural environments should be

considered together or separately. Leaving that discussion aside, since the previous

section has already covered the consideration of the social aspects surrounding

development interventions, this section will focus on the natural –biophysical—

environment.

There is already a long history of analysis of environmental impact. The first

legislation on Environmental Impact Statements came from the US government in the

early 70s under the National Environmental Protection Act (NEPA 1979) with the

intention of applying it to all major new development and construction projects. During

the 1980s many countries formally embraced Environmental Impact Assessment (EIA),

but it was not until the 1990s that many developing countries approved EIA legislation

(World Commission on Dams., 2000: 182).

In the last two decades concerns about global environmental problems such as the

depletion of the ozone layer and global warming, as well as human generated disasters 97

== Rrrr ==

such as Bhopal and Chernobyl have contributed to greater public awareness of

environmental problems in all countries.

In the field of development, major bilateral and multilateral aid agencies require

nowadays some kind of environmental screening in project analysis. The type of

environmental assessment varies depending on the type of project. Roughly, there are

projects the aim of which is some kind of environmental improvement, projects with

goals not related to environmental improvements but with very important environmental

effects, and projects with negligible environmental effects.

The first step in the environmental assessment of a development project is often

referred to as environmental screening –UNEP calls it preliminary assessment (United

Nations Environment Programme, 1988)—, and is intended to give an idea of potential

environmental effects of a project. It often consists of a simple checklist of the most

important factors such as size, location, and nature of the project. Major aid organizations

produce their own checklists8 – for example the British ODA (Overseas Development

Administration., 1996), OECD (Winpenny, 1995), or the World Bank (World Bank.

Environment Dept., 1991).

In most countries nowadays EIA legislation specifies the necessary contents of the

preliminary screening process, which depends on the nature of the project, its size and its

== Rrrr ==

8 UNDP offers a complete list of references at http://web.archive.org/web/20050218214338/http://www.undp.org:80/seed/guide/handbook/part3.htm. 98

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location, with special attention paid to those interventions taking place in areas

considered particularly vulnerable or fragile.

As a result of the screening process a project could either obtain the green light, if

the effects are considered minimal or negligible, or could be recommended for a full

environmental impact assessment (EIA). The possibility for a project to proceed without

further EIA is normally articulated in the legislation. In the US, for example, a project

may obtain a FONSI (finding of no significant impact) permit, which allows it to proceed

without going through a full EIA, and other countries provide equivalent options. Project

proponents, of course, prefer a FONSI or equivalent path, which is less expensive and

less time consuming.

When a full environmental impact assessment is needed, there are several points that

need to be considered.


* What would be the future state of the environment if the proposed project were

executed?


* What would be the future state of the environment without the project?


* What would be the future state of the environment if one of the identified

alternatives (if there are any) were applied instead of the preferred one?


* Assess the magnitude of the changes resulting from the project, whether they are

beneficial, and their importance –this implies some type of measurement.


* Potential mitigation measures in the case of adverse impacts. 99

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When a project results in significant environmental impacts the EIA process

normally generates a plan for environmental management and monitoring during the

implementation and post-project.

In order to proceed with the assessment the identified environmental impacts of the

project, both positive and negative, need to be measured and quantified if possible,

including their type, size, range, social and spatial distribution, potential cumulative

effects –e.g. acres of agricultural land flooded or level of noise generated by an

installation in decibels.

Once measured and maybe quantified, environmental effects need to be valued. After

all, negative (and positive) impacts need to be compared with other benefits to be

obtained from the project to decide if it is worthwhile undertaking it. Many of the

valuation methods assign monetary or economic values (easy to compare) to

environmental effects, which is often controversial.

There are several more or less standard procedures in environmental economics,

commonly classified as objective valuation –effect on production, human capital,

replacement costs, preventive expenditure— or subjective preference valuation – hedonic

methods, travel cost, contingent valuation. A description of environmental valuation

techniques is beyond the scope of this thesis. Good descriptions of these techniques is

offered by the World Bank (World Bank. Environment Dept., 1991), Dixon (Dixon, et

al., 1994), or Winpenny (Winpenny, 1991). 100

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A more radical approach to the full consideration of environmental aspects is

provided by supporters of ecological economics such as Herman Daly. Instead of

devising ways to incorporate environmental aspects into mainstream economics resulting

in the kind of patchwork proposed by environmental economics, ecological economics

considers economics as a subset of ecology. Ecology studies the energy transactions of

life and the earth, and the human economy is a subset contained in it. Natural capital is

considered at the same level with human-made capital, and both are complementary

rather than interchangeable –lack of natural capital cannot be substituted by more human-

made capital (Daly, 1996). Most of the ideas of ecological economists did not made their

way into mainstream development so far, although many of them were developed and

written by Daly while he was working at the Environment Department of the World

Bank.

As we have seen so far, requirements and procedures for the environmental

assessment of development interventions are quite extensive and specific in the

legislation of most countries as well as in the standard procedures of aid agencies. The

important question for us is: does the environmental aspect play an important role in the

definition and selection of the best alternative to achieve the development goal of a

specific development intervention?

A look at the procedures for environmental assessment seems to suggest that they are

more likely to be used to generate a binary result (green or red light) to projects that have 101

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already been defined and to define mitigation measures to adverse effects, rather than to

be part of the decision-making process that defines the best way to achieve the goals.

In this regard, Adger and Chigume indicate that the institutional set-up of

environmental analysis has traditionally focused on one project and precludes the

consideration of alternative projects –while cost benefit analysis includes this

automatically through the decision criteria of IRR, NPV, etc (Adger and Chigume, 1991).

In a similar vein, the report from the World Commission on Dams (2000), after an

extensive analysis of dam projects that were executed over several decades, points out

that EIA results have no significant influence on the choices made. The report states that

EIA is “not well suited to this purpose as it was meant solely for identifying impacts and

associated mitigation measures rather than as a tool for including environmental and

social considerations in the final project choice and design” (World Commission on

Dams., 2000: 183).

In the next chapter we will look at some factual information about actual projects

that seems to confirm the relatively minor role of environmental assessment in the

definition and selection of the best ways to achieve the goals in development

interventions.

Other dimensions. Integration of criteria.

The previous sections have presented some of the procedures commonly used for the

assessment of development interventions in the economic –and financial—, social, and 102

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environmental aspect. What about the other two aspects presented in our framework

introduced in section two: cultural and political?

These two dimensions are not commonly dealt with separately, but as a part of social

analysis procedures. The World Bank, for example, points out that the social analysis

process “identifies opportunities and constraints arising from the country’s socio-cultural,

institutional, historical and political context and, armed with that knowledge, prepares

strategies that are more effective in achieving the project’s intended social development

objectives to help reduce poverty” (World Bank, 2003: 6).

Considering that the analysis of the cultural and political aspects involved in

development interventions depends even more than the social analysis on the point of

view of insiders, we could take the level of participation by local people in the definition

and assessment of the project as an indication of how much those aspects are taken into

account. The more local people are involved in the definition and appraisal of the project,

the more likely it is that cultural and political issues enter the equation. The next chapter

provides some insight about participation levels by local people in development

interventions.

Only in the case of indigenous peoples does the World Bank specifically and

separately address the issue of cultural assessment and cultural appropriateness of

development projects. In its Social Analysis Sourcebook, the Bank mentions just once the

question of cultural compatibility of development interventions, when it says that concern

for issues such as indigenous peoples and people displaced through resettlement 103

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“underscored the importance of consulting and participating with affected groups, and

helped to shift the Bank’s social concerns toward the culturally [[appropriate development]]

of indigenous peoples” (World Bank, 2003: 79).

As for the political aspect, although politics at all levels, from local to international,

is involved in every one of these interventions –especially so when multilateral or

bilateral organizations are present because their main partner is a national government—

political appraisal or analysis is never present explicitly in the appraisal guidelines. As we

will se in the next chapter, the most explicit references to political aspects found in

appraisal documents are quite aseptic descriptions of institutional arrangements.

Integration of criteria

Let us consider now how the different criteria considered in the appraisal of

development interventions can be integrated in order to make decisions as to whether the

project should be undertaken or not, or what would be the best alternative to achieve the

goals. Cost benefit analysis provides normally a numeric value that can be used in the

decision-making process, but other assessments produce results that are not so simple.

Oftentimes the different analyses are made separately and then a trade-off is found

through judgment or negotiation between specialists from different disciplines. Working

this way means that there is no communication between people from diverse disciplines

during the assessment process, the relative importance of the assessments from different

perspectives is not clear, and therefore the final decision might be arbitrary. 104

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Some authors (Pelt, 1993; Petry, 1990; Potts, 2002) suggest a more systematic way

to take into account the assessments from the different disciplines, what they call Multi

Criteria Analysis (MCA).

In MCA a set of different criteria to assess a project would be defined based on its

stated objectives, and any foreseeable impacts –even if they are not goals of the project.

All the goals/impacts can be entered into a matrix, where for each one of them it is

indicated if the impact is likely to be positive or negative, who are the stakeholders

affected, whether each particular goal/impact is taken into account in the standard

economic CBA, and the criteria to be used to assess it –specially for those not included in

CBA. For each goal/impact it is necessary to define a scale. Those included in CBA

already have a monetary value assigned, and for the rest a quantitative, if possible, or

qualitative value needs to be assigned. Finally, weights are to be assigned to each

criterium in order to come up with a final value representing the worthiness of the

project. Ideally a value would be obtained for each one of the potential project

alternatives, as well as for the “without the project” option.

Although more systematic, MCA as proposed by these authors still does not solve

the big issues: the definition of a scale for non-quantitative values, and the assignment of

weights, a very subjective process. 105

== 5. Actual Assessment In The Case Of Energy Projects ==
The previous chapter reviewed typical analysis and appraisal procedures as described

by some of the most important agents in the development field, and how they relate to the

five aspects included in our framework: economic, social, environmental, cultural and

political.

This chapter will shed some light into what kind of assessment is actually done, by

narrowing and focusing the attention on development interventions in the energy sector in

which the World Bank, one of the most important development institutions, was

involved.

Analysis of World Bank documents

The idea is to assess the degree of importance given in World Bank interventions to

each one of the five aspects. The assessment was based on the analysis of World Bank

published documents for each one of the interventions included in the study.

The World Bank maintains a public database9 of development projects in which it is

involved. It is organized in several sectors such as education, finance, health and other

social services, industry and trade, etc. The analysis presented here focused on the energy

and mining sector. At the time the information used for the analysis was updated from the

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9 World Bank projects database can be accessed at www.worldbank.org 106

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World Bank site for the last time, May 2005, the database showed a total of 873 records

of projects under the energy and mining category.

Each project in the database is assigned a status among the following options:

proposed, active, closed and dropped. The analysis was limited only to “closed” projects,

in an attempt to guarantee that all documents related to each project were already

available through the Bank’s site. Limiting the search to “energy and mining” projects in

“closed” status generated a total of 521 records, with approval dates ranging from

December 1984 to December 2004.

There are several types of documents that the World Bank publishes for its projects.

The most common is the Project Information Document (PID), a very brief document that

provides a short overview of the project. Other typical documents are the Project

Appraisal Report (PAR), Staff Appraisal Report (SAR), Environmental Assessment

(EA), Implementation Completion Report (ICR), Resettlement Plan (RPL), or Indigenous

Peoples Plan (IP).

According to the Bank, the Project Appraisal Document (PAD) –Staff Appraisal

Document (SAR) before 1995—includes all the information that the Bank’s Board of

Executive Directors needs in order to approve a project. In the Bank’s web page that

describes the project cycle (www.worldbank.org), it states that in the appraisal phase

Bank staff review the work done during identification and preparation, often spending three to four weeks in the client country. They prepare for bank management either Project Appraisal Documents (investment projects) or Program Documents (for adjustment operations) and the Financial Management team assesses the financial aspects of the project.

After this, during the negotiation and approval phase 107

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the Project Appraisal Document (PAD) or the Program Document (PGD), along with the Memorandum of the President and legal documents are submitted to the Bank's Board of Executive Directors for approval. The appropriate documents are also submitted for final clearance by the borrowing government which may involve ratification by a council of ministers or a country's legislature. Following approval by both parties, the loan agreement is formally signed by their representatives. Once this has occurred, the loan or credit is declared effective, or ready for disbursement, after the relevant conditions are met, and the agreement is made available to the public.

Regarding those documents, the Bank says

The Project Appraisal Document (PAD) presents all the information the Board needs to approve Bank financing of the proposal. Before 1999, this document was called the Staff Appraisal Report. The Program Document (PGD) describes adjustment lending operations, and sets out the Bank's appraisal and assessment of the feasibility and justification for the program.

For this analysis only projects, not programs, have been considered – programs are

articulated through several projects after all. Therefore the relevant documents to look at

are Project Appraisal Documents, or Staff Appraisal Reports (as they were called before

== 1999). ==
Out of 521 “closed” projects in the energy and mining sector, only 127 of them have

either a PAD or SAR publicly available through the Bank’s web database, roughly a

quarter of them. It is not clear whether this low percentage of projects with publicly

available appraisal documents is due to confidentiality or transparency issues, or to lack

of efficiency in the administration of the project’s documents or the public database. In

any case, those 127 appraisal documents, PAD or SAR, constitute the base of this

analysis. 108

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Aspects assessed in World Bank documents

The documents were analyzed in order to assess how much attention was given in

the analysis and appraisal to each one of the five aspects included in our framework:

economic, environmental, social, cultural, and political. The method used is very simple:

counting pages.

The appraisal documents analyzed range from 30 to 320 pages –typically 80-150

pages—, include 4 to 7 main chapters, and several annexes. The analysis and appraisal

information is provided, normally quite summarized, in one or several of the main

chapters, and more extensively in one or several annexes.

Project Appraisal Documents include one chapter specifically dedicated to project

analysis, called Summary Project Analysis, with subsections for economic, financial,

environmental, social, etc. Relevant typical annexes with more detailed information are

Cost Benefits Analysis Summary, Environmental and Social Impact Assessment

Summary, etc. Appendix 1 shows an example of the table of contents of a Project

Appraisal Document.

Staff Appraisal Reports typically include one chapter called The Project that

describes the project and briefly provides information on economic, environmental and

social analysis. Commonly, another chapter called Project Justification provides

additional analysis and appraisal information, especially from the economic standpoint.

More extensive information is often provided in annexes such as Environmental 109

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Assessment Overview, Resettlement Action Plan, or Economic Justification of the Project.

Appendix 2 shows an example of the table of contents of a Staff Appraisal Report.

For each document the number of pages dedicated to economic appraisal or analysis

–mainly cost benefit analysis— was counted, both in the main chapters and in the

annexes. This part was very easy because those pages are very explicit and typically as

separate sections or subsections.

The same procedure was applied to environmental and social appraisal or analysis.

The environmental part is typically covered in separate sections, although sometimes it

appears together with the social analysis. In those cases it was necessary to read through

and calculate the number of pages dedicated to each aspect.

Social analysis pages include specific sections or subsections dedicated to the

subject, pages dedicated to distributional issues sometimes included in the economic

analysis part, sections or subsections dedicated to resettlement when it applies, and

subsections dedicated in some documents to participation or participatory approach.

References to cultural analysis or appraisal were very rare, and when present they

were under Indigenous Peoples or Indigenous Peoples Plan. Those pages were counted

towards the cultural aspect.

And finally, the political aspect. Of course politics at all levels, from local to

international, is involved in every one of these interventions, especially so if we consider

that in most projects where the World Bank is involved its main partner is a national

government. Nevertheless political appraisal or analysis is never present explicitly on 110

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these documents. PADs always include a subsection called institutional analysis, while

SARs typically include some information about the institutional arrangements of the

project itself or the context in which it takes place. Although some of this information is

merely descriptive, it was decided to count these pages in the documents as assessment of

the political aspects –giving the benefit of the doubt.

Once the pages for each of the five aspects were counted for all documents, a

percentage was calculated for each one of them. Of all the pages dedicated to analysis or

appraisal, that is, the addition of the pages counted for all five aspects, we calculate the

percentage for each of the five aspects in our framework: economic, environmental,

social, cultural, and political.

Let us say, for example, we have a PAD of 200 pages including 40 pages for

economic analysis, 20 pages for environmental, 20 for social, 10 for cultural and 10 for

political. The total appraisal or analysis pages is 100, and therefore in this example we

would have a 40% of economic analysis, 20% environmental, 20% social, 10% cultural

and 10% political.

These percentages were calculated for all 127 documents –PADs and SARs—, and

the results were averaged for all of them. Figure 9 below shows the results obtained. 111

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Political 8% Cultural 0%

Social 15%

Economic 53%

Environmental 24%

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Figure 9: average space allocated to each of the five aspects

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Clearly the method used can only offer an approximate idea of the relative

importance given to the economic, environmental, social, cultural, and political aspects in

the analysis and appraisal of projects. Nevertheless, the differences among the five

aspects coming out of the analysis are so stark that they do not leave any room for doubts

despite the imprecision of the method.

Figure 9 shows how more than half of the space dedicated to analysis and appraisal

is used for the economic aspect alone. The environmental aspect receives almost a quarter

of all the analysis pages. It is important to notice that the parts of the documents dealing

with environmental aspects tend to be quite wordy because they often include references

and reproductions of a country’s environmental regulations or the Bank’s directives

regarding environmental issues. An important part of the pages dedicated to the 112

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environmental aspect deal with measures to be taken to mitigate known or potential

negative impacts of the interventions, and therefore do not really constitute

environmental assessment. They have been included nonetheless.

The social aspect takes about 15% of the total. As explained above, this includes

specific social assessment sections, distributional issues included sometimes in economic

assessment sections, subsections related to participation, and those dedicated to

resettlement. The latter, resettlement, has to do with the mitigation of a negative impact,

involuntary relocation.

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Social - Resettlement 32%

Social assessment & distribution 53%

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Social - Participation 15%

Figure 10: Detailed break down of the social aspect

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The detailed composition of all the pages counted as social aspect is shown in Figure

# As we can see, of the already small 15% allocated to social aspects, about two thirds

can be considered genuinely so, including participation, explicit social assessment, and 113

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distribution issues. One third of it is allocated to resettlement, that is, mainly mitigation

measures for negative impacts.

As for the cultural aspect, only an insignificant 0.27%, not even enough to show up

in the graph, is allocated to them. Obviously the cultural aspect is not a major concern in

the assessment of World Bank projects.

The political aspect including, as explained above, discussions about institutional

arrangements, reaches a small 8%.

The results shown so far were calculated giving the same weight to every single

project, regardless of its size. Another calculation was done taking into account the total

amount in US$ committed by the Bank to each project. Instead of simple averages of all

projects for each aspect, a weighted average was calculated using the Bank’s monetary

allocation (i.e.the data from a $100M project is 100 times more important than the data

from a $1M project).

Figure 11 shows the results obtained with this second calculation. As we can see,

there are small differences. The economic aspect still takes about half the space, while the

environmental aspect grows perceptibly. This seems to reflect the fact that bigger

projects, such as dams, thermal power generation plants or oil infrastructure projects,

tend to have more environmental implications (mostly negative) and are subject to more

environmental scrutiny. 114

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Political Cultural 7% 0% Social 16%

Economic 50%

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Environmental 27%

Figure 11: average space allocated weighted by project's total $ amount

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The importance of the social aspect apparently remains almost the same, but a closer

look at the details (Figure 12) shows otherwise. Of the already small space allocated to

the social aspect (16%), only less than 40% of it can be considered genuinely so, while

most of it, 60%, is used for resettlement issues.

This is related to the fact that bigger projects tend to have bigger implications in

terms of resettlement of people. This is especially true for dams, but applies also to power

distribution or oil and gas infrastructure projects. What is important for us is that the

importance given to the social aspect is still smaller than what it appeared to be from a

first look at Figure
# 115

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The results obtained for the cultural and political aspects with the weighted averages

do not change much from those obtained with straight averages.

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Social Assessment and distribution 30%

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Social - Resettlement Social - 61% Participation 9%

Figure 12: Detailed break down of the social aspect (weighted by project’s $ amount)

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We have seen how the size, in terms of money committed by the Bank, affects the

relative importance of the five aspects considered in the assessment. Let us now look at

whether and how the type of project influences it.

Each World Bank project is assigned a percentage value for each major sector to

which it is related, and to each subcategory within those sectors. Examples of the major

sectors are: agriculture, fishing and forestry; education; energy and mining; finance;

health and other social services; water, sanitation and flood protection; etc.

The energy and mining sector in which we are focusing is divided into six

subcategories: general energy sector; power; oil and gas; mining and other extractive;

district heating and energy efficiency services; and [[renewable energy]]. 116

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A specific project could belong to only one subcategory, for example 100% power

(energy and mining sector). Or it could belong to several of them, for example: 22%

irrigation and drainage (agriculture, fishing and forestry sector), 9% general public

administration (law and justice and public administration sector), 23% power (energy and

mining sector), 23% roads and highways (transportation sector), and 23% water supply

(water, sanitation, and flood protection sector).

As we know, all the projects analyzed are related to one or more subcategory in the

energy and mining sectors. For each project in our set the percentages assigned to each

subcategory in the sector were gathered, and used to calculate how much, for the whole

set of projects, belongs to each subcategory. Figure 13 shows the results obtained.

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Power 23% Oil and Gas

Mining & Other 46% Extractive 5% Heating & Energy Efficiency 10% Renewable

7% Non Energy 9%

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Figure 13: Projects assigned to energy subcategories 117

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As the graph shows, for all the analyzed projects taken as a whole, almost half are

assigned to the power subcategory, which means power generation, transmission and

distribution systems. This includes mainly big hydropower generation (large dams),

thermal power plants, and power transmission lines (high and medium voltage). The rest

of the energy related part is assigned to oil and gas (basically extraction and

transportation infrastructure), mining and other extractive, district heating and energy

efficiency, and renewable energy (only 5%). Almost a quarter is assigned to other non-

energy sectors.

We must remember that these are all the World Bank projects somehow related to

energy for which there is appraisal documentation available. We can already appreciate

here the huge disproportion between the use of fossil fuels and big dams, versus the use

of renewable energy (big hydropower dams are included in the power section, while mini

and micro-hydro is included in the renewable energy section).

In the previous calculation all the projects were assigned the same importance,

regardless of the total amount committed by the Bank to them. A new calculation was

done assigning projects different weights according to the total amount contributed by the

Bank. Figure 14 displays the results. The graph shows how the differences have

increased, since projects in the power subcategory, especially those for power generation,

involve much bigger investments than, for example, renewable energy projects. 118

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Power 21% Oil and Gas

Mining & Other 3% Extractive 4% Heating & Energy 59% Efficiency 5% Renewable

8% Non Energy

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Figure 14: Projects assigned to energy subcategories, weighted by $ amount

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The next step was to analyze the effect that the category to which a project belongs

has in the importance given to each one of the five aspects considered in the analysis and

appraisal process. In order to do this, all the projects that had a significant component of

each category (more than 30%) were selected, and the average percentage of pages

dedicated to each one of the five aspects was calculated again. That is, for all the projects

with more than 30% assigned to the power subcategory, the average number of pages is

calculated in the economic, environmental, social, cultural, and political aspects. Then the

averages for all the projects with more than 30% in the oil and gas subcategory, and so

on. 119

== 70 ==
60 Power 50 Oil and Gas 40 Mining and extractive %

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30 District Heating and Energy Efficiency 20 Renewables 10

0 al ic

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al

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l

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al ra om

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ci

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ic t en

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tu So



lit ul on



nm



Po C Ec



ro vi En



Figure 15: relative importance of the five aspects by project type



Consistent with the results previously shown, the economic aspect is very important

for all types of projects, although it seems to be more so for those mainly related to the

power or the district heating and energy efficiency subcategories.

The environmental aspect is significantly more important in oil and gas, and mining

and other extractive subcategories, probably due to higher environmental concerns and

scrutiny in projects related to fossil fuels.

The results for the social aspect are very interesting. Oil and gas projects give the

least importance to the social aspect, while renewable energy projects give the most,

close to 20%. Renewable energy projects include mostly rural electrification projects

involving distributed (local) generation based on solar systems, mini and micro hydro, 120



biomass, etc. This kind of work inherently needs much more involvement from the local

people than for example the construction of a gas pipeline or a thermal power plant,

mainly managed at the level of the national government.

Cultural assessment is insignificant in all subcategories, and differences in the

political aspect are due basically to the method used for measurement. As explained

above, the pages counted towards the political aspect are those that refer to institutional

arrangements. Those pages are normally present in projects that involve participation of

institutions at a high political level, national or regional. The role of these institutions is

less important in renewable energy projects, and this fact is reflected in the graph.

Assessment of alternatives

So far we have looked at the importance given in World Bank’s project appraisal

documents to the five different aspects of development projects considered in our

framework.

One of the key steps of the Objective Oriented Project Planning (OOPP) method,

explained in the previous chapter and embraced by most major development actors,

including the World Bank, is the analysis of alternatives. This process should include the

generation of a list of alternative ways that can lead to the achievement of the goals, with

as much involvement as possible of the stakeholders, and the selection of the best

alternative following criteria based on financial, technical, economic, institutional, social,

and hopefully cultural, grounds. 121

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Let us look at whether several alternatives to reach the goals of a project are actually

considered and explained in the Bank’s appraisal documents and, if so, how wide or

narrow is the range of alternatives considered, and how significant the discussion about

them.

All the Project Appraisal Documents – the Bank’s standard appraisal document after

1999— include a subsection specifically dedicated to alternatives, called Project

alternatives considered and reasons for rejection, typically part of the section called

Project Rationale –see Appendix 1 for an example.

Staff Appraisal Reports –pre-1999– do not have a specific section dedicated to

alternatives, and when there is some discussion about them it might be part of the

economic analysis, environmental analysis, a section on the context or the country sector

in which the project takes place, etc.

Using the same method again, the number of pages dedicated to the discussion of

alternatives in each one of those documents was counted. It was found that out of 127

appraisal documents, as many as 36, almost a third, did not include any reference

whatsoever to potential alternatives.

For the rest, the documents that do discuss alternatives, the average number of pages

dedicated to them is about 6.5% of the number of pages dedicated to appraisal including

all five aspects considered above (economic, environmental, social, cultural and

political). When the calculation is made weighting the values for each project with the

total amount committed by the Bank for that project, the value goes down to 5.5%. 122

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These numbers are obviously too small to leave the impression that a serious and

thorough consideration of alternatives is done during the appraisal of development

projects. However, it is fair to say that the documents analyzed are to be reviewed and

evaluated by the Board of Executive Directors of the World Bank, and it is probably not

realistic to expect that they would read a lengthy explanation of all the alternatives

considered, besides the selected one.

We could assume that the detailed analysis of alternatives has been done in previous

stages by the teams involved in the preparation of the project, and the appraisal document

is only meant to mention them and briefly describe why they were rejected.

Even under this assumption, only 30 of the analyzed documents, about a quarter of

the whole set, offer a good, albeit brief, explanation of a broad range of alternatives

considered and the reasons why they were rejected. An example is provided in appendix

3 for a household energy project in Chad.

Of all the projects that do discuss alternatives, at least 20 of them do not show a

serious consideration of a reasonable range of alternatives, that is, there could clearly be

other ways to reach the goals that are not mentioned at all. Typical examples are a

thermal power generation project that only considers alternative sites for the plant,

without mentioning other potential sources of energy, or an oil or gas pipeline project that

considers alternative routes, but does not mention other means of transportation for the

fuel, or even other sources of energy in the destination area. 123

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Overall we can see that out of 127 appraisal documents, 36 do not include any

consideration of alternatives, and 20 offer a very poor and narrow discussion. That makes

56, almost half of the whole set. As for the rest, 30 of them, a quarter of the total, include

a good discussion, and another quarter are at least reasonable.

Although this analysis leaves us with a disappointing idea of how seriously

alternatives are considered in World Bank project, the situation seems to be improving.

At least the new standard appraisal document of the Bank, the PAD –post-1999—,

always includes a section on alternatives. Something that was not true of the older SARs.

Findings of the World Commission on Dams

Having presented the results of the study of World Bank interventions in the energy

sector over the last 20 years, it is interesting to contrast them with the findings of a huge

and comprehensive study prepared by the so-called World Commission on Dams.

The Commission was created in 1997 with a major objective of reviewing the

development effectiveness of large dams and assessing alternatives for water resources

and energy development (World Commission on Dams., 2000: 30).

An important part of the work of the Commision was an extensive review of the

experience with large dams. The work lasted about two and a half years between 1998

and 2000, and covered roughly one thousand large dams that were built from the 50s to

the 90s. It involved several hundred people representing a wide spectrum of interests

from all sides of the debate about large dams, including government agencies, research 124

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institutes, private engineering companies, utilities, bilateral and multilateral agencies

(including the World Bank), NGOs, and dam affected people.

The Commission generated a knowledge base including case studies of large dams,

country reviews, thematic reviews, and a cross-check survey of existing dams, which

provided the basis for their evaluation of the experience with large dams.

Relevant to the study presented here is the Commission’s emphasis on how large

dam projects are appraised, the decision-making process involved, and the assessment of

alternatives for the provision of water and electricity services.

With regards to the different aspects considered in planning and appraisal for large

dams, the Commission found it was only cost-benefit analyses and technical parameters

that were important, while environmental and social impacts were left aside, even in the

1990s.

The WCD Report (World Commission on Dams., 2000: 175-76) states that

… once a proposed dam project has survived preliminary technical and economic feasibility tests and attracted interest from financing agencies and political interests, the momentum behind the project and the need to meet the expectations raised often prevail over further assessments. Environmental and social concerns are often ignored and the role of impact assessments in selecting options remains marginal.

Specifically, the Report dismisses efforts to incorporate social and environmental

valuation into cost-benefit analysis, and conclude that in the application of CBA “social

and environmental impacts are not valued explicitly or are only indirectly accounted for

through mitigation and resettlement budgets.” 125

== Rrrr ==

While the Commission considers that social and environmental issues are key for a

dam to be an effective development project, their study shows that environmental and

social adverse impacts from large dams were not in general key factors in the decision-

making process.

Environmental Impact Assessment (EIA) was adopted officially in many countries in

the 1980s and in many developing countries in the 1990s in order to address social and

environmental impacts but, the Report says, “EIA consists mostly of measures to

compensate or mitigate the planned impacts and render them acceptable when the

decision to proceed has already been taken” (World Commission on Dams., 2000: 182).

The Commission analyzed in a cross-check survey of 105 dams whether they

included economic cost-benefit analyses, financial plans, risk, distributional and

sensitivity analyses. Figure 16 reproduces the graph from the Report showing the results

obtained. 126

== Rrrr ==

Figure 16: Evolution of economic and financial assessment for large dam projects Source: Word Commission on Dams Report, 2000

We can see how CBA and financial plans have been widely used since the fifties,

while risk, distribution, and sensitivity analysis are much less common and even in the

nineties they are included only in a little more than 20% of the projects.

The Commission analyzed also the use of environmental and social impact


assessments in the appraisal of the same sets of dams. Figure 17, reproduced from the

Report, displays the results. 127

== Rrrr ==

Figure 17: Evolution of environmental and social assessment for large dam projects Source: World Commission on Dams Report, 2000

As the graph shows, the use of environmental impact assessment increased

throughout the years, although it is still far from universal. Even after the nineties it is

done only in a little more than 50% of large dam projects. It is importance to notice the

vertical axis top value of 60%, as opposed to the 100% shown in the previous figure.

The practice of including social impact assessment is far less common and, although

it has increased steadily since the seventies it reaches less than 30% of large dam projects

undertaken in the nineties.

The results obtained by the World Commission on Dams in their study of large dam

projects confirm and reinforce the outcome of our own study of energy projects. The 128

== Rrrr ==

economic aspect continues to be the main one considered in the planning and appraisal of

development interventions, with the environmental aspect being increasingly included,

although mostly in order to define mitigation measures rather than as an important input

in the decision-making process. The social aspect has very little importance in planning

and appraisal and is mostly used to design mitigation measures related to resettlement of

affected populations.

As for the assessment of alternatives in the planning and appraisal of large dam

projects, the Report states:

Many sectoral planning studies from which projects emerged were narrow technical and economic studies, aimed at least-cost supply solutions for providing a single service such as irrigation water or electric power. When dams were contrasted with alternatives, they were typically only compared to other potential dam projects or, in the case of hydropower, with alternative large-scale thermal power generation options (World Commission on Dams., 2000: 178).

The conclusions of the Commission are partly based on eight case studies carried out

worldwide on big dams using the same methodology and approach, and intended to

provide information on the development effectiveness of large dams. Table 11 has been

adapted from the Report and illustrates the type of narrow consideration of alternatives

commonly practiced and the predominance of economic criteria in the assessment of

alternatives.

According to the Commission, seven out of eight dams included economic criteria in

the assessment (three of them exclusively). Only one of them included environmental and

social dimensions. The political dimension was present in three of them (one of them

exclusively). The alternatives considered regarding the water component of the project 129

== Rrrr ==

were limited to alternatives sites, and in one case alternative delivery methods (irrigation

by gravity or pumping). The alternative for the power component, when considered, was

always thermal power.

The findings of the Commission regarding options assessment also confirm the

results obtained from the study of World Bank energy projects. The consideration of

alternatives to the main option proposed for the project, when it exists, includes only a

very narrow spectrum of options, often having to do only with different locations for the

same kind of solution. 130

== Rrrr ==

Table 11: Examples of analysis of alternatives in large dam projects Source: Word Commission on Dams Report, 2000, p. 178 131

== 6. Final Considerations ==
The main motivation for this thesis was an interest in finding the answers to three

questions regarding technological choices made in development interventions. When are

those choices made? Who makes the decisions? Following what criteria?

There is an additional question that was not explicitly part of the first design of the

thesis: what decisions are being made? The idea was to consider first development

interventions in general, looking at institutional procedures as defined by the agents

involved, without any restriction to any specific sector or type of project. But once it

came to the analysis of actual projects, limiting the study to the energy sector, the answer

to this question surfaced immediately.

Trends in development interventions for the energy sector

For the energy sector, let us consider potential choice between energy generation

technologies: fossil fuels, big hydro (big dams), and renewable technologies. As we saw

in the previous chapter, projects in which the World Bank participated in the last twenty

years in the energy field show a disproportionate preference for energy generation based

on fossil fuels or big dams (technologically complex, big investments, centralized

control), and by contrast a very small interest in renewable energy (technologically

simpler, smaller investments, more distributed control).

It is worthwhile to present here some relevant information regarding this subject that

was gathered during the preparation of this thesis from the Creditor Reporting System 132

== Rrrr ==

(CRS online) database of the OECD10, regarding investments by OECD countries in

development aid. The database reports investments in aid activities by OECD members in

developing countries and less developed countries, mainly channeled through bilateral

aid agencies and export credit agencies of each member country, the World Bank, and/or

regional development banks. Data for investments in the energy sector was collected and

organized by year, and by energy generation technology in three groups: non-renewable

(fossil fuels), hydro (big hydro), and renewable (including mini and micro-hydro). Figure

18 shows the results in terms of total investment (in 2002 US$) per year for each one of

the three groups. Figure 19 shows the same results in a different format to clarify the

evolution of total investments per year.

As we can see in the graphs, the results follow a pattern similar to the one shown for

World Bank projects in the previous chapter: a disproportionate preference for big hydro

and fossil fuel based generation in detriment of renewable energy. Indeed the investments

in renewable energy are very much insignificant until 1994, when they appear in the

picture, although still at low levels.

From 1997 until 2000 there is an important decrease in total investments in energy,

which coincide with a steep decline in investments in big hydro projects. This reduction

of big hydro is also noted in the study of the World Commission on Dams, and is related

== Rrrr ==

10 The data was collected on December 2004 from OECD’s CRS online database at www.oecd.org/dac/stats/idsonline 133

== Rrrr ==

to the exhaustion of sites economically suitable for big hydro around the globe –basically

most river areas suitable to be dammed have been already dammed.

Starting in year 2000 total investments in energy start increasing again, but virtually

all growth is in non renewable sources, essentially fossil fuels.

Totals per Year (x1000)

4000000 Non Renewable 3500000 Hydro Renewable 3000000

== 2500000 ==
== 2000000 ==
== 1500000 ==
== 1000000 ==
== 100 ==
== 50 ==
# Alternatives In An Appraisal Report 154==

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== 80 ==
== 60 ==
== 40 ==
== 20 ==
== 500000 ==
== 0 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 ==
Figure 18: Energy investments in developing countries by OECD members ($ amount, 2002 prices) Source: OECD Creditor Reporting System Database 134



Totals per Year (x1000)

8000000 Renewable 7000000 Hydro Non Renewable 6000000

== 150 ==
== 5000000 ==
== 4000000 ==
== 3000000 ==
== Analysis And Appraisal ..................................................................................75 ==
vi Planning and managing projects: Objective Oriented Project Planning

and the Logical Framework.................................................................................75

Cost-benefit analysis ...........................................................................................84

Social analysis .....................................................................................................91

Environmental analysis .......................................................................................96

Other dimensions. Integration of criteria...........................................................101

== 5. Actual Assessment In The Case Of Energy Projects .................105 ==
Analysis of World Bank documents..................................................................105

Findings of the World Commission on Dams ...................................................123

== 6. Final Considerations .................................................................................131 ==
# Alternatives In An Appraisal Report...........................153==

== Bibliography .......................................................................................................154 ==
vii LIST OF TABLES



Table 1: Typical stakeholder table for a development project...........................................58

Table 2: Typical participatory matrix for a development project ......................................59

Table 3: Stakeholder Analysis table from TeamUp methodology and

software.......................................................................................................................61

Table 4: Stakeholder table for a private sector population project in Pakistan

funded by ODA...........................................................................................................65

Table 5: Participation matrix for a private sector population project in

Pakistan funded by ODA ............................................................................................66

Table 6: Stakeholder table for Water Supply and Sanitation project funded

by DFID ......................................................................................................................68

Table 7: Participation matrix for a Water Supply and Sanitation project

funded by DFID..........................................................................................................69

Table 8: Stakeholder table for Emergency Sanitation projects..........................................71

Table 9: Participatory matrix for an Emergency Sanitation Project ..................................72

Table 10: Logical Framework Matrix................................................................................80

Table 11: Examples of analysis of alternatives in large dam projects.............................130



viii LIST OF FIGURES



Figure 1: Main framework for Technology and Development..........................................18

Figure 2: Technology and the Economy............................................................................20

Figure 3: Integral view of technology, society and development......................................27

Figure 4: Technology and Power.......................................................................................35

Figure 5: Technology and the Environment ......................................................................42

Figure 6: Baum's project cycle...........................................................................................49

Figure 7: Problem tree in Objective Oriented Project Planning ........................................77

Figure 8: Social Assessment process according to the World Bank..................................93

Figure 9: average space allocated to each of the five aspects..........................................111

Figure 10: Detailed break down of the social aspect .......................................................112

Figure 11: average space allocated weighted by project's total $ amount .......................114

Figure 12: Detailed break down of the social aspect (weighted by project’s

$ amount) ..................................................................................................................115

Figure 13: Projects assigned to energy subcategories......................................................116

Figure 14: Projects assigned to energy subcategories, weighted by $ amount................118

Figure 15: relative importance of the five aspects by project type ..................................119



ix Figure 16: Evolution of economic and financial assessment for large dam

projects......................................................................................................................126

Figure 17: Evolution of environmental and social assessment for large dam

projects......................................................................................................................127

Figure 18: Energy investments in developing countries by OECD members

($ amount, 2002 prices) ............................................................................................133

Figure 19: Energy investments in developing countries by OECD members

($ Total, 2002 prices)................................................................................................134

Figure 20: Energy investments in developing countries by OECD members

(n. projects) ...............................................................................................................135

Figure 21: Energy investments in developing countries by OECD memebers

(total projects)...........................................................................................................136

== Rrrr ==

x 1

== 1. Introduction ==
Planet Earth. 2004 CE. Two robotic explorers arrive and land successfully on planet

Mars after a 6 months trip from planet Earth of about 60 million miles. The president of

the United States announces a new expensive goal of sending human beings to Mars.

Planet Earth. 2004 CE. 852 million human beings, more than 13% of humankind, are

malnourished— a number that increased over the last 4 years. At least five million

children under the age of 5 die a year as a result of malnutrition and associated diseases

(Food and Agriculture Organization of the United Nations, 2004) .

The belief that technology is fundamental for development, characteristic of Western

modernity, and the pervasive faith in scientific and technical knowledge has inspired the

field of “development” since its inception in the aftermath of World War II. In 1949,

during his first speech as president of the U.S., Harry S. Truman stated:

More than half the people of the world are living in conditions approaching misery… Their poverty is a handicap and a threat both to them and to more prosperous areas. For the first time in history humanity possesses the knowledge and the skill to relieve the suffering of these people … I believe that we should make available to peace-loving peoples the benefits of our store of technical knowledge in order to help them realize their aspirations for a better life … Greater production is the key to prosperity and peace. And the key to greater production is a wider and more vigorous application of modern scientific and technical knowledge.1

Many consider Truman’s speech the beginning of a new era where the industrially

advanced countries of the world would concern themselves with the “development” of

== Rrrr ==

1 President Harry Truman, Inaugural address as president of the United States, 20 January 1949, in Documents on American Foreign Relations, Connecticut: Princeton University Press,
# 2

== Rrrr ==

the so called less developed countries (LDCs). More than two decades later, after

American technological prowess had been able to send a man to the moon, then-Secretary

of State Henry Kissinger stated:

For the first time we may have the technical capacity to free mankind from the scourge of hunger. Therefore today we must proclaim a bold objective: that within a decade, no child will go to bed hungry, that no family will fear for its next day’s bread, and that no human being’s future will be stunted by malnutrition.2

Today, three decades after Kissinger’s statement, still many children go to bed

hungry, many families do not have enough food, and malnutrition is a terrible problem in

many areas of the world. Eradication of extreme poverty and hunger is still today at the

top of the international community’s agenda – note the United Nations’s Millennium

Development Goals. What went wrong? Do we not, or did we not yet have the technical

capacity to solve these problems? Or does the eradication of poverty around the world

and the economic and social development of LDCs necessitate much more than just

advanced technical capabilities and scientific knowledge?

This author believes the latter to be the case. It has been argued, for example, that

genetically modified organisms (GMOs), and specifically genetically engineered crops

constitute the technological panacea that, if sufficiently mastered and promoted, will do

away with hunger in the world. Hartwig de Haen, the assistant director general in the

economic and social department of the UN Food and Agriculture Organization (FAO),

said in an interview after the release of FAO’s report The state of food insecurity in the

== Rrrr ==

2 Henry Kissinger, World Food Conference, Rome,
# 3

== Rrrr ==

World 2004 that "the world in aggregate is getting wealthier and producing more than

enough food … The problem is the access of people to jobs, to resources, to land and to

money to buy food.'' (Becker, 2004)

This author agrees with Attwood, Bruneau and Galaty, when they assert that

“poverty reduction depends more on the distribution of political power than it does on the

impact of capital, technology or markets."(Attwood, et al., 1988: 10).

Technology by itself will not solve the problem of poverty and hunger, although it is

certainly an important tool that, if used properly, can help the international community,

and practitioners of “development” in particular, in the pursuit of that goal.

Almost any development intervention, whether or not it is related directly to issues

of technology transfer, technical assistance, or technological capacity development,

makes use of a specific technology to reach its goals. This means that at some point any

development intervention chooses, whether implicitly or explicitly, one type of

technology over another.3 For example, in an area where many people suffer from

malnutrition, would it be appropriate to introduce capital-intensive modern agricultural

3 The term “technology” in used in a rather loose manner here, referring to two different technologies as two different ways to reach a goal. If the goal is to provide energy for lighting and cooking in a village, the different technologies that could be used would include a connection to the electricity grid, an off-grid electricity supply such as photovoltaic power or wind power, or wood burning for cooking and kerosene lamps for lighting. Next chapter includes a discussion of the definition of technology. For extensive discussions on the subject read Arghiri Emmanuel’s Appropriate or Underdeveloped Technology? (1982) and Raphael Kaplinsky’s Automation: The Technology and Society (1984). 4

== Rrrr ==

technologies using GMOs for increased productivity, or might it be better to support a

land redistribution program and traditional agricultural techniques supported by irrigation

based on human-powered water pumps?

How and why one type of technology is chosen over another, who is involved in that

decision, and whether there is any consideration given to potential technological

alternatives are the main concerns of this thesis.

There are numerous scholarly works concerning the role technology plays in

different aspects of human life on Earth. Several authors discuss the relationship between

technology and society from historical (Diamond, 2003; Landes, 1999), anthropological

and sociopolitical (Hawken, et al., 1999; Kaplinsky, 1984; Postman, 1992), and

philosophical (Illich, 1973) perspectives. There is a plethora of authors discussing the

importance of technology in developed economies from an economic point of view

(Galbraith, 1985; Galbraith, 1973; Rosenberg, 1982). In the development literature there

is abundant material on the role of technology in developing nations (Emmanuel, et al.,

1982; Escobar, 1995; Schumacher, 1973; Smillie, 2000; World Bank, 1998), and on

technology transfer between nations and its different mechanisms (Katz, 1987; Madu,

1992). Also within the literature on development, many studies address the

appropriateness or adequacy of the technologies promoted and used in developing

countries and the effects of choosing one specific technology over another (Forsyth, et

al., 1980; James, 2000; James and Khan, 1997; McRobie, 1995; Rodd, 1994; World

Water Assessment Programme of the United Nations, 2003). 5

== Rrrr ==

However, the literature is not so abundant in studies that focus on the dynamics of

actual development interventions, on the understanding of the processes involved and the

interactions between the various stakeholders concerned. Most of what is written in this

regard takes the form of internal evaluation reports on projects or programs implemented

by bilateral and multilateral agencies such as USAID or the World Bank and is, therefore,

not readily available. The fact that the pioneer work by Hirschman on analysis of

development projects, Development projects observed (Hirschman, 1967), was reissued

three decades after it was first published (Hirschman, 1995) speaks by itself. There are a

few recent and very interesting works about the subject (Long, 2001; Rodwin, 1994),

although most of them do not specifically focus on the decisions around the choice of

technology and the effects of the choices made. The study Technical knowledge and

development, by engineer and anthropologist Thomas Grammig (Grammig, 2001)

provides a sensitive insider’s view into the subject. A major contribution addressing the

issue is the report Dams and development: a new framework for decision-making by the

World Commission on Dams (World Commission on Dams., 2000) and subsequent work

by the Dams and Development Project of the United Nations Environment Program

(UNEP). Although the report focuses on dams, its findings and conclusions have

important implications for any development intervention where different technological

alternatives might be available. This report will be used as a reference throughout this

thesis. 6

== Rrrr ==

There are important questions that need answers. How is it possible, for example,

that even in cases where local authorities had carefully considered the choice of potential

technologies and advocated for those with a set of features which they considered

favorable to local conditions, yet decisions were made by the managers involved in

decision-making to adopt technologies with quite different or even opposed features? The

studies by Bagachwa and James (Bagachwa, 1992; James, 1996) address this specific

question for the grain milling sector in Tanzania. They discuss the influence in

development projects of the bureaucratic interests of local decision-making agencies,

which shift the balance in favor of those projects easier to implement (less effort from the

agency), with bigger budgets and guaranteed financial resources, regardless of the

appropriateness of the technology they use.

This exploration into the internal dynamics of development interventions as regards

technological decisions is very important for those working in the field of development,

especially the more technical people, engineers and economists, who tend to look at them

through “objective scientific” lenses without paying much attention to the complex

sociopolitical and cultural aspects that in fact are crucial for decision-making and in turn

affect the final outcomes.

The present research study looks at typical development interventions involving

large development institutions trying to understand when in their life cycle, from the

moment when they are conceived, the decisions regarding the choice of technology are

made, by whom, and following what criteria. 7

== Rrrr ==

In order to understand when and by whom the decisions are made, the study

examines the procedures regarding development projects described by major actors in the

field of development. Moreover, an examination of the appraisal procedures as explained

by those major actors gives an idea of the criteria officially used for the selection of

technologies. Finally, a review of World Bank projects in the energy sector implemented

in the last three decades provides an insight of the actual criteria used, and some

additional clues as to who is involved in the decision.

This author approaches the study mainly as a learning experience that will let him

acquire a better understanding of development interventions and will guide his future

involvement in the field of development. Hopefully this work will provide some insights

that are useful for current and prospective participants in this fascinating field. 8

== 2. Technology, Society, And Development ==
In order to understand the subject matter of this work, the consideration given to

different technological alternatives in development interventions and the criteria used to

select one over another, it is important to position and visualize the subject in the broader

framework where it belongs. This second chapter provides that big picture framework.

The chapter reviews several perspectives regarding technology and development,

introducing points of view that go beyond the importance of technology for the

development of “less developed” or “developing” countries and discusses also the role of

technology in advanced “developed” industrial societies.

Knowledge, technology, power and development

The author’s interest in the role of knowledge and technology in development was

triggered by the work of Susan Strange and her concept of structural power. Strange

defines it as “the power to shape and determine the structures of the global political

economy within which other states, their political institutions, their economic enterprises

and (not least) their scientists and other professional people have to operate.”(Lawton, et

al., 2000: 8)

According to Strange, structural power rests on four main pillars. Four separate,

although interdependent, power structures: security, production, finance and knowledge.

Regarding this last pillar, knowledge, she contends that “knowledge is power and

whoever is able to develop or acquire and to deny the access of others to a kind of 9

== Rrrr ==

knowledge respected and sought by others, and whoever can control the channels by

which it is communicated to those given access to it, will exercise a very special kind of

structural power”(Lawton, et al., 2000: 51).

What did Strange mean by knowledge? According to her, there are two main aspects

to it. First, knowledge as technology in the broad sense –the application of knowledge to

production, which includes the tacit knowledge necessary to operate production systems

and is embodied in persons and organizational structures. During the twentieth century,

especially the latter part, and continuing to the present, this type of knowledge has been

generated more and more inside big companies, normally transnational corporations,

either through in-house research facilities or operational routines, in a process that

Mytelka calls “privatization of knowledge” (Lawton, et al., 2000: 42). This progression,

together with a substantial expansion of intellectual property rights since the 1980s and

its enforcement through the World Trade Organization, has resulted in a significant shift

of this kind of structural power from states to firms- mainly MNCs from a few

industrialized countries.

The second aspect concerns knowledge as the base of belief systems. According to

Strange, “technological development is not a sufficient condition for furthering shifts in

the dimensions of structural power. Such shifts can only come about because of a change

in the belief systems that underpin the political-economic arrangements that are

acceptable to a society.” States, through their systems of education, have the ability to

affect perceptions and beliefs. Strange contends that, “there can be little doubt that power 10

== Rrrr ==

[in the knowledge dimension] lies with American universities and American professional

associations.” This portion of structural power would then be shared in a symbiotic

relationship by states, mainly the US, and some significant non-state actors –institutions

of higher education and research, many of which are private (Lawton, et al., 2000: 141).

Regardless of the plausibility of Strange’s model, it gives rise to a lot of questions

about the role of knowledge –both aspects of it— in the development of “less developed

countries.” Do they need to master modern technologies to improve their productive

systems in order to achieve development, or at least economic development? What kind

of technology should LDCs use or master? Current Western technology? Much has been

written about technology transfer, normally implying transference of technology from

advanced industrialized countries to LDCs. But, is Western technology appropriate for

LDCs? Or should LDCs develop and master their own indigenous technology? If some

technology needs to be transferred, what is the best way to do it? What should

governments of LDCs do to ensure that technological improvements enhance the living

conditions of their citizens –presuming that is what they care about? What is the cultural

and institutional context in which modern technology thrives?

Many authors from different disciplines have dealt with these questions. Perspectives

range from the simplistic view that modern Western technology is undoubtedly good for

LDCs, and it is just a matter of finding the best way to “transfer” it, to positions that see

Western control over knowledge and technology as a new form of colonialism through 11

== Rrrr ==

which developed countries continue to control and exploit the Third World. This chapter

offers a review of the different perspectives.

Definition of technology

A note on terminology is necessary at this point. The specific definition of

knowledge and technology is quite controversial. The author would certainly have trouble

trying to define some key terms used in this thesis: knowledge, technology, or

development –and would probably not be alone. However, since the main subject of this

work has to do with the selection of one among several potential technical ways to

provide a solution to a problem, that is, the choice of a technology within a range of

potential alternatives, at least we need to have a common understanding of what is meant

by “technology” in the remainder of this work.

The United Nations, in a 1981 document on technological development referred to

technology vaguely as “a combination of equipment and knowledge”(United Nations,

1981). From a more functional point of view, technology is commonly defined as the

application of knowledge in production. Galbraith referred to technology as the

systematic application of scientific or other organized knowledge into practical tasks

(Galbraith, 1967). The OECD was more specific defining technology as the “systematic

knowledge for the manufacture of a product, for the application of a process or for the

rendering of a service, including any integrally associated managerial and marketing

techniques” (OECD, 1981: 18). 12

== Rrrr ==

As far as the “function” of technology is concerned, the OECD definition is good

enough for our purposes. But with regards to its components the OECD definition is

more problematic because it seems to leave out any hardware. We can complement the

OECD definition with a report from the United Nations Economic and Social

Commission for Asia and the Pacific (ESCAP) which says that technology consists of

four embodiment forms: object-embodied technology (technoware), person-embodied

technology (humanware), document-embodied technology (inforware) and institution-

embodied technology (orgaware) (ESCAP, 1989).

When we discuss the choice of technology we will have to consider what is the

specific goal for which we need a technology (function). Then it is necessary to identify

all the different technologies that can be used to achieve that goal. Later we need to see

what combination of the four embodiment forms is required by each potential technology

identified. And finally, what is the availability of those components in the particular

setting where the intervention will take place. The comparison between the set of

components required by a specific technology and the availability of those components in

the particular setting should inform the choice of technology.

Development and the field of development

As with the term technology, the definition of development is quite controversial and

certainly not a goal of this thesis. Indeed, it is possible to read extensive academic works

within the field of development studies, including highly recognized ones, without 13

== Rrrr ==

finding an explicit definition of what development is. However, since the term is used

== Rrrr ==

throughout the document, it is necessary to have a word on its possible meanings.

First of all it is necessary to distinguish between the field of development, and the

concept of development as applied to countries, societies, peoples.

Let us start with the easy part. The field of development arguably started with the

end of World War II, about the time when US president Harry S. Truman made the

famous speech quoted at the beginning of chapter one. People felt that nations should

help each other move forward instead of fighting each other. It was the beginning of

development policy, and development became an active word. Development policy

constitutes a deliberate effort, including vision and planning, to help nations that are

considered less developed reach a higher level of development.

When the field of development is mentioned in this thesis, it refers to actors,

structures, processes, etc., related to this deliberate effort: development policy.

And now the difficult part: the concept of development. It has to do with the vision

driving the deliberate effort mentioned above, with the understanding of what constitutes

a higher level of development.

In the early days of development policy the concept was mainly understood from an

economic perspective. Truman himself, in his speech, based prosperity on greater

production, and the two most important early theories in development studies,

modernization theory and dependency theory, were mostly focused on economic

development. 14

== Rrrr ==

Later on the focus shifted towards the inclusion of social aspects, and people in the

field started to talk about socio-economic development. The Human Development Index,

created by the United Nations in 1990 as an index to measure the level of development of

nations, considers three components: health (life expectancy), education (literacy index),

and standard of living (economic well-being based on GDP per capita).

More recently some actors involved in the field of development have included

another important component into the concept of development: empowerment. Purported

beneficiaries of development should be able to decide by themselves what is best for

them. Oxfam opens its Handbook of Development and Relief (Eade, et al., 1995) with the

following statement:

Strengthening people’s capacity to determine their own values and priorities, and to organize themselves to act on these, is the basis of development. Development is about women and men becoming empowered to bring about positive changes in their lives; about personal growth together with public action; about both the process and the outcome of challenging poverty, oppression, and discrimination; and about the realisation of human potential through social and economic justice. Above all, it is about the process of transforming lives, and transforming societies.

This author prefers simpler description, at the expense of precision: development is

about the improvement of people’s lives according to their own standards.

Nevertheless, it is important to have in mind that throughout this thesis different

perspectives from different actors are introduced, and each one of them has a different

understanding of what development is. Notwithstanding this diversity, the improvement

of material living standards remains the underlying objective of development. 15

== Rrrr ==

Main Framework

This work is concerned with the interrelation between technology and the field of

development. In every development intervention one specific technology is selected over

others in order to provide a solution to the target problem. Many of the factors that

determine which technology is chosen are specific to the field of development, its

dynamics, and the people and organizations involved in it. But other very important

factors are not specific to the field of development and are related to the broader arena of

the relationship between technology and society in general.

Having this in mind, this section proposes a framework in which the interrelation

between “technology and the field of development” is considered as a subset of the

overarching interrelation between “technology and society.” This interrelation between

technology and society is not considered for any particular society, industrialized,

developing, or otherwise, but in generic terms. Although it could be analyzed for

different societies and different times, we will have in mind this era of globalization

where the interrelation between technology and society presents many common global

trends mainly based on the particular case of western industrialized “modern” societies

that have been and continue being exported to the rest of the globe.

The interrelation between technology and society is a multifaceted one, and we will

consider five major aspects of it: economic, social, political, cultural and environmental.

Any effort directed at examining this relationship, as well as the “narrower” one between

technology and the field of development, should take into consideration all five aspects in 16

== Rrrr ==

order to be complete. Unfortunately, as we will later see in actual circumstances, very

often some aspects are overemphasized while others are all but forgotten.

Figure 1 below is an attempt to provide a visual framework including all that has

been said above, and will be used as a reference for the discussions about technology,

society and development.

The outer circle represents the overarching relationship between technology and

society in general, and takes into consideration what is understood as development. It

circumscribes the inner circle, which represents the relationship between technology and

the field of development, and of course is very much influenced by the outer circle. The

outer and inner circle represent structure.

In between, close to the outer circle, we find a ring that represents “technology

transfer” between institutions within a society –any generic society, not specific to one

industrialized, developing or otherwise. We are not too concerned about this particular

ring in this thesis.

There is another ring, closer to “technology in the development field,” which

represents what is commonly called “North-South technology transfer,” that is, the

transfer of technology between “advanced” industrialized countries and “developing” or

“less developed” countries. The two intermediate circles represent process.

All circles or rings are equally divided into five sectors, corresponding to the five

aspects or dimensions that should be considered for all of them: economic, social,

political, cultural and environmental. 17

== Rrrr ==

The five dimensions inform what is considered development in a society. The

relative importance given to those dimensions is different in different societies, and

therefore the idea of what development or progress is would also be different.

Given the current structure of the world, and of international relations between

countries –societies—, the specific combination of the five dimensions, the idea of what

development or progress means, is passed on from the rich industrialized countries –

mostly Western countries— to the so-called developing or less developed countries,

through the field of development –some would say this transfer is involuntary but

inevitable, some would say it is consciously imposed.

Within the field of development, some combination of the five dimensions informs

decision-makers involved in the assessment and selection of the best options (including

the choice of technology) that would lead to the achievement of the goals formulated for

a specific development intervention. 18

== Rrrr ==

Figure 1: Main framework for Technology and Development

== Rrrr ==

Different perspectives

This section reviews some of the different perspectives held by scholars and

practitioners in areas related to technology, society and development, with emphasis in

identifying the main aspects (of the five presented in the figure) in which their particular

point of view is based. An effort has been made to group these perspectives along shared 19

== Rrrr ==

characteristics and to map each group into our graphic framework in order to clarify this

survey.

Technology and the economy

We will first look at those perspectives that consider mainly (if not exclusively) the

relationship between technology and economic development. In the Western world of

modernity and positivism the belief that technology is essential for progress is very well

rooted. The mastering of modern technology –which according to this belief took place

under the appropriate cultural and institutional conditions— is indeed widely considered

the main engine that drove the Western world, starting in Europe, to its current privileged

position –see David Landes’ bestseller The Wealth and Poverty of Nations (Landes,

1999) or Jared Diamond’s Pulitzer-Prize winner Guns, Germs and Steel (Diamond,

== 2003). ==
Under this perspective the path of modern technology is generally considered as

something external to the socio-political process. Technology follows a kind of “natural

path,” and the specific conditions of a society can either inhibit or promote its

advancement through this “natural path” of technological progress. Those societies that

are receptive are the ones that “develop.”

There are many writings dealing with the relationship between technology and

economic development at the macro level. Studies in this group are authored mainly by

economists and cover the role of technology in well-developed economies, as well as the 20



importance of technology in “developing” or “less developed countries.” This group of

writings would correspond in our framework figure to the outer circle in the “economic”

sector –see Figure 2.



Figure 2: Technology and the Economy



From the macro perspective there is an implicit assumption that the growth of an

economy at the macro level improves the standard of living all over a country, including

the poor areas. For those who accept this basic generic principle, it would of course be

true also for the countries that are not considered well “developed” yet, that is, the so-

called developing countries or less developed countries. We are looking now at the inner 21



circle in our framework, concentrating in the field of “development,” still in the

“economic” sector –see Figure 2.

Since the advancement of technological prowess is considered a major engine of the

economy, it is therefore also one of the main factors to reach “development.”

Knowledge is like light. Weightless and intangible, it can easily travel the world, enlightening the lives of people everywhere. Yet billions of people still live in the darkness of poverty –unnecessarily… Poor countries—and poor people—differ from rich ones not only because they have less capital but because they have less knowledge. Knowledge is often costly to create, and that is why much of it is created in industrial countries (World Bank, 1998: 1).

This excerpt from the World Development Report 1998/99, entitled “Knowledge for

Development,” reflects the position of the World Bank and that of many mainstream

professionals in the field of “development.” The perspective of the World Bank shares

the basic tenets expressed by Truman and Kissinger as quoted in the introduction,

although quite less optimistically, given the situation of the poorest people of the world at

the beginning of the new millennium.

The basic concept is that technology and knowledge are necessary for development,

and that the industrialized countries generate and are in possession of the most valuable

knowledge and technology. LDCs need this knowledge for their development, and the

best thing to do is to acquire it from the advanced countries. As the World Bank report

says, “developing countries need not reinvent the wheel … rather than re-create existing

knowledge, poorer countries have the option of acquiring and adapting much knowledge

already available in richer countries” (World Bank, 1998: 2). 22



There are plenty of studies dealing with the transfer of technology within and

between developed countries, but here we are interested in the vast literature on the

transfer of technology to developing and less developed countries –what is commonly

called North/South technology transfer, the second inner ring in our framework –see

Figure
# The majority of these studies deal with two main issues. First, what are the

different mechanisms through which technology is actually transferred: foreign direct

investment, licensing, trade, multilateral or bilateral technical cooperation, etc, and which

one is best under what conditions. Second, what are the institutional conditions in the

recipient country that favor effective technology adoption and dissemination. If we

consider our framework picture, it is mainly the economic aspect, and to a much lesser

extent the political aspect, the ones considered from this perspective.

Cultural and social aspects of technology transfer, such as the social and cultural

changes that new technologies might bring to recipient countries are not given much of a

thought. When some social or cultural factors are discussed they seem to be considered

more as an obstacle to be overcome than anything else. There is some concern, for

example, about the effect of the local cultural environment in the speed and effectiveness

of the “necessary” technology transfer, or maybe the adaptation of technologies to local

culture.

Although the World Bank Report, as well as writings by other authors –like Madu

below—who share this perspective, allow for some questions to be raised about which

are the right technologies to be used or developed by LDCs, or whether the acquisition of 23



foreign knowledge and technology also brings with it changes in tastes and/or values that

could be detrimental for the receiving society, they never seem to address them in depth.

Christian Madu, for example, contends: “The issue, however, is not whether or not to

transfer technology; the issue is how to transfer ‘appropriate’ technology.” But in his

book, Strategic Planning in Technology Transfer to Less Developed Countries, Madu

focuses mainly on how to transfer technology, and less on what kind of technology is

“appropriate” (Madu, 1992: 3).

Madu asserts that “the major transferers are multinational corporations (MNCs) who

are predominantly based in the United States, Western Europe, and Japan… despite the

increased number of sources from which technology can be transferred, the MNCs

remain the most essential and powerful suppliers of technology.” Indeed, technology

transfer from advanced countries’ agents –basically MNCs— to LDCs is the only

mechanism that receives consideration throughout the remainder of Madu’s book (Madu,

== 1992: 2,4). ==
So, we see that the main question from this perspective concerns the best way to

transfer technology from the advanced industrialized countries to the LDCs. And their

preferred answer: through the spillovers generated by multinational MNCs by way of

foreign direct investment.

The World Bank Report states: “Valuable knowledge spillovers can occur through

their [MNCs’] training of local staff and through contacts with domestic suppliers and

subcontractors” (World Bank, 1998: 8). This is really disturbing, if you think about it. 24



The most important mechanism for technology transfer relies on spillovers that can

occur. What if they do not occur? How significant are those spillovers? However, it is

important to make a distinction between different countries in the Third World. Big

economies such as China, India, and even Brazil do have more leverage and can acquire

technology by negotiating from a position of power.

It is not surprising that a report issued by the World Bank considers that “the three

key means of facilitating the acquisition of knowledge from abroad are an open trade

regime, foreign investment, and technological licensing” (World Bank, 1998: 7-8).

Neoclassical thought tends to be present in anything coming from the World Bank.

But it is not only among neoliberals or mainstream developmentalists that we find

defenders of this particular view of technology and development. Arghiri Emmanuel, the

well-known author of Unequal Exchange (Emmanuel, 1972), and ardent critic of the

“modernization theory” of development, shares the same perspective with regard to

technology and development. In his book, Emmanuel criticizes the unfavorable terms of

trade between the ‘core’ countries –industrial products— and the “periphery” –primary

products—, which are responsible for the growing inequality between them. His book

Appropriate or Underdeveloped Technology (Emmanuel, et al., 1982) argues that

advanced technologies are good because they are more productive. According to this

author, “what is important is the amount of goods produced and not the number of jobs

created to produce these goods,” because that is what increases the social welfare.

Developing countries need the most advanced technologies available in order to increase 25



their productivity and make industrial products so they can get a better deal regarding

terms of trade. Advanced industrialized countries constitute the model to follow, and the

only way for LDCs to catch up with them is to take the shortcut offered by the transfer of

already existing advanced technologies. Emmanuel forcefully criticizes defenders of

“appropriate technology” –see below— because it “perpetuates underdevelopment and

poverty.” Furthermore, regarding the best way to transfer those technologies, Emmanuel

considers multinational companies “the favoured means by which the Third World’s

technological development path may be cut short” (Emmanuel, et al., 1982: 1).

Integral view of technology, society and development

Under the perspective discussed in the previous section the path of modern

technology is generally considered as something external to the socio-political process.

Technology follows its “natural path,” and the characteristics of a society would either

inhibit or promote its advancement through this “natural path” of technological progress.

In this section we look at perspectives that believe things can be done in different

ways; that technological progress can follow different paths and a society and its

individuals can decide which path they prefer to follow. It is a human choice to promote

one path over another both in developed countries and in less favored areas, and their

choices do not need to be the same. Technology is not independent from the socio-

political processes. Borrowing from the title of a major work on this subject, technology

(“artifacts” in the original title) does have politics (Winner, 1986). In our framework, this 26



point of view draws from all the aspects in the circle, not just the economic one. The

main question here is not whether technology is good for development, but which

technologies are best.

Having this in mind, we will consider two major areas of focus. The first one

embraces what in academia is mainly known as science, technology and society (STS)

studies. These studies are concerned with the mutual relationship between technology and

society in general, not just in the developing World: the ways in which the adoption and

promotion of specific technologies transform societies and the lives of its members and

shape their environments, and how societies in turn define the paths through which

technologies evolve. In our framework we are looking at the outer circle, but including all

the aspects of it, not just the economic –it has been labeled “technology choice” in Figure

== 3. 27 ==
Figure 3: Integral view of technology, society and development



Many authors are indeed quite concerned about the path that technology has taken in

western “modern” societies, and in turn the way in which those societies are evolving.

“We are becoming the servants in thought, as in action, of the machine we have created to serve us.”4



4 John Kenneth Galbraith. Quoted in Ian Smillie, Mastering the Machine Revisited : Poverty, Aid and Technology (London: ITDG Publishing, 2000)., Mastering the Machine Revisited, opening page. 28



This quote by John Kenneth Galbraith in his book, The New Industrial State

(Galbraith, 1985), leads us to question whether modern technology actually improve the

lives of human beings –in both the developed and the less developed world.

Raphael Kaplinsky, in Automation, the Technology and Society (1984), analyzes the

effect of modern technology –his study focuses on automation technology— in society.

The author contends that according to the evidence, “automation as we know it continues

the trend in the capitalist labor process towards increased job-fragmentation, deskilling

and greater control by management as the representative of capital” (Kaplinsky, 1984:

133) Instead of blaming technology per se, Kaplinsky wonders about something that the

author of this thesis, as an engineer himself, had confronted quite often:

But how can it be, that a technology which promises so much, can offer so little to the mass of the world’s population? After all surely any technology which reduces the need for human labour must in principle be favourable? For if your goal is to work for fulfillment rather than out of necessity, and if we are to be able to develop a wide range of skills and interests to satisfy ourselves as human beings, then clearly the advance of automation technology must be desirable (Kaplinsky, 1984: 170).

Kaplinsky finds the answer in the rejection of what he calls “technological

Darwinism,” which considers that technology follows its own logical path of

development irrespective of the social context. Technology would be something to be

discovered, and its course therefore immutable. Kaplinsky believes that technology is not

neutral; instead it is influenced by sociopolitical factors. The author asserts that

technology:

reflects the power relations inherent in the social system. Power is obtained and reinforced by the ability to command and appropriate surplus… Technology offers the potential for this surplus to be generated and appropriated. But … specific techniques are required… ‘Capitalist labour processes’ are designed to maximize the profit to the capitalist ... they necessarily involve 29



a minimization of labour input, the deskilling of labour so as to cheapen its cost, a hierarchical system of control and an increasing subdivision of labour (Kaplinsky, 1984: 174).

Therefore, for Kaplinsky the problem relies in the way society is organized, rather

than technology itself. In his own words, from the concluding remarks of his book, “the

problem lies not with the technology, but in a form of social organization which misuses

its potential to produce frighteningly destructive weapons, inappropriate products and

undesirable work processes. This stands as a direct indictment of contemporary

capitalism” (Kaplinsky, 1984: 18).

It is rather surprising how Kaplinsky seems to leave aside his criticism of the course

technological developments have taken, and in a chapter dedicated to their impact on

Third World countries he contends that, “the key question … concerns the diffusion of

these automation technologies to the Third World” (Kaplinsky, 1984: 158) Following on

his major tenets it seems more appropriate to question how to change the course and the

uses of technology development in the advanced industrialized countries first.

From a more philosophical standpoint, Schumacher describes the function of work,

according to the Buddhist point of view, to be threefold: “to give a man a chance to

utilize and develop his faculties; to enable him to overcome his ego-centredness by

joining with other people in a common task; and to bring forth the goods and services

needed for a becoming existence” (Schumacher, 1973: 58) From this point of view,

Schumacher distinguishes two types of mechanization: “one that enhances a man’s skill

and power and one that turns the work of man over to a mechanical slave, leaving man in

a position to having to serve the slave” (Schumacher, 1973: 58) Schumacher believed that 30



modern societies tend toward the latter type, transforming people into slaves –those lucky

enough to have a job, anyway.

Schumacher went further and, in Small is beautiful (1973), casts doubt on the whole

‘production’ machine that Western societies have become, and includes chapters entitled

Socialism, Ownership, and New patterns of ownership, where the author questions the

basic dynamics of capitalism, the virtues of private property, and considers socialism as

an alternative.

Neil Postman, in his book Technopoly: the surrender of culture to technology

(Postman, 1992), contends that advances in technology have surpassed the capacity of

social mechanisms for cultural development reaching a point where American culture has

become a sort of self perpetuating machine. Postman believes that the evolution of the

relationship between humans and technology has gone from cultures that use tools —

without being subordinated to them—, to technocracies that are increasingly determined

by technological growth, and lastly technopolies, which he depicts as totalitarian

technocracies in which the "thought world" of a culture is mainly determined by

technological development. Postman believes that at the moment he wrote the book the

only technopoly in the world was the US.

Postman is gravely concerned with what he calls Scientism (Postman, 1992: 146-48),

one of the pillars of Technopoly, consisting of a set of three interrelated ideas: “that the

methods of the natural sciences can be applied to the study of human behavior… that

social science generates specific principles which can be used to organize society on a 31



rational and humane basis… [and] that faith in science can serve as a comprehensive

belief system that gives meaning to life, as well as a sense of well-being, morality, and

even immortality.”

In a similar vein, Ivan Illich in his book Tools for Conviviality (1973), defines

“convivial” tools as “those which give each person who uses them the greatest

opportunity to enrich the environment with the fruits of his or her vision,” and contends

that, “industrial tools deny this possibility to those who use them and they allow their

designers to determine the meaning and expectations of others. Most tools today cannot

be used in a convivial fashion” (Illich, 1973: 21). Furthermore, in a presentation given in

1996 where Illich explained his ideas about technology in philosophical and theological

terms, he discusses the evolution of ‘technology’ from the beginning to the end of the

20th century:

… technology was still seen as a tool to be used for the achievement of an end set by the user; one could still speak in terms of a final cause; technology was not yet the very milieu itself. It had still not redefined homo, from a tool-user to a co-evolved product of engineering…things have mutated from being instruments to becoming systems.5

From this point of view that questions the course that modern technology is taking in

advanced industrialized societies, one should also question whether it makes any sense to

transfer modern technology to LDCs.

The second major area in this section deals with the technological choices available

to those involved in the field of “development,” that is, the improvement of the lives of

5 Ivan Illich, presentation given to The American Catholic Philosophical Association at their annual meeting in Los Angeles, California, 23 March
# 32



people in “developing” or “less developed” countries. Well-known paradigms of the field

such as intermediate or [[appropriate technologies]] are included here. This is the area where

the main focus of the work presented in this thesis, the choice of technology in

development interventions, belongs, and will be further discussed in chapter
# In our

framework we are looking at the inner circle, “technology and development,” but

including all the aspects of it, not just the economic –it has been labeled “Appropriate

technology” in Figure 3.

E.F. Schumacher, the author of the now classic book Small is beautiful (1973),

founded the Intermediate Technology Development Group (ITDG). ITDG is

representative of a particular perspective regarding the issue of technology and

development. Simply put, defenders of intermediate technologies and appropriate

technologies –without getting into the murky details of which technologies can be

included, can be considered together linked by their concern for the choice of

technology— basically believing that technology can indeed greatly improve the lives of

poor peoples. But not any technology can do that, and often not the technologies

mastered and designed by and for peoples in technologically advanced countries. The

conditions in LDCs are very different, and a major concern should be, for example, the

creation of employment, more than the simple increase of total output. A special effort

has to be made to adapt Western technologies to the social and economic conditions of

LDCs –e.g. greater availability of labor compared to capital— to incorporate local 33



knowledge into the technologies selected, and to develop as much as possible the

necessary technologies locally.

Authors who share this perspective are very critical of the huge infrastructure

projects commonly sponsored by the World Bank and other donor agencies because their

big organizational and financial requirements are well beyond the managerial, technical

and financial capabilities of the people they purportedly benefit –massive dam projects

such as Egypt’s Aswan High Dam or India’s infamous Narmada project are common

targets of this kind of criticism (Smillie, 2000: 37-47). Ian Smillie, in his book, Mastering

the machine revisited, published by the ITDG, criticizes that for many of these projects,

“the technology, the expertise and the final decision in almost all cases lay in the North,

rather than the South” (Smillie, 2000: 41).

Regarding the mechanism to be used for the transfer of technology, most of the

discussion held by authors concerned about the choice of technology involves aid projects

sponsored by bilateral and multilateral donor agencies such as USAID, NORAD, the

World Bank or the International Monetary Fund; mediated by NGOs in the North and

most importantly in the South; and focused on local communities as recipients and as

main decision-makers during the definition and execution of the projects.

Contemporary defenders of intermediate or appropriate technologies, such as Smillie

and the ITDG, focus their criticism of the “development” business, and the role of

technology within it, on both the choice of technology and the method used to transfer it. 34



Technology and power

In this section we focus on the political aspect of the relationship between

technology and society, although we will see that it is much mingled with the cultural

aspect.

Major philosophers like Pierre Bourdieu (Bourdieu and Johnson, 1993) and Michel

Foucault (Foucault, 1972) wrote extensively about the complex, intimate, and often

symbiotic relationship between knowledge (technology would be a subset of it) and

power in societies in general, and how technologies are used as tools of control. This

subject corresponds to the outer circle of the framework figure, in the “political” sector,

and is far beyond the scope of the work presented here –see Figure 4.

More relevant to the field of development, located mainly in the “political” aspect of

the inner circle of our framework figure, is the role of knowledge in general and

technology in particular as a potential tool of domination in the unequal North/South

relationship –see Figure 4.

Anthropologist Arturo Escobar (Escobar, 1995), building on the conceptions of

power-knowledge and discourse analysis developed by Michel Foucault, approaches the

issue from a perspective that considers not just technology as defined above, but more

generally knowledge as belief systems – the second aspect of knowledge according to

Susan Strange, as we saw at the beginning of this chapter. 35



Figure 4: Technology and Power



Escobar criticizes the representations championed by mainstream “development”

actors, such as the World Bank, because they implicitly assume Western standards as the

guide to assess the situation of Third World peoples, and their paternalistic attitude

contributes to upholding the idea of Western superiority (Escobar, 1995: 8).

Escobar raises questions that are seldom addressed about the Western standards that

accompany development interventions: “What happens when they are introduced in a

given social setting? How do they occupy social spaces, and what processes –alteration of 36



sensibilities, transformations in ways of seeing and living life, of relating to one another–

do they set in motion? In sum, to what extent do these political technologies contribute to

creating society and culture?” (Escobar, 1995: 142)

An example of the biased and myopic view of Western development institutions that

resonates with Escobar’s assertion that historically “Western discourse has refused to

recognize the productive and creative role of women” and therefore has “contributed to

propagating divisions of labour that keep women in positions of subordination” (Escobar,

1992: 141), is provided by anthropologist Anne E. Ferguson, in her article “Gendered

Science: A Critique of Agricultural Development” (Ferguson, 1994). She analyzes an

interdisciplinary agricultural research project aimed at improving bean production in

Malawi. Agricultural scientists wanted to understand why farmers in Malawi planted

mixtures of so many different bean varieties together in their fields, with the specific

intention of looking at social factors, besides the biological ones. After interviewing local

farmers, they concluded that farmers knew very little about the characteristics of beans

and therefore the variety was due to physical and biological factors. Ferguson’s team

pushed further and continued the research, this time interviewing female as well as male

farmers. It turned out that women had a more important role in the knowledge and

responsibility of bean production than men. The wide variety was in fact the result of a

conscious and carefully crafted effort, mostly by female farmers.

Ferguson thinks that the role of women remains marginal even in research and

development programs that bear the “sustainability” label, and that those programs often 37



undermine the status of women instead of empowering them, especially in Africa. She

contends that Western agricultural science is the result of social construction, and

therefore it is not objective and, as it concerns this case, male-biased.

Escobar also characterizes development interventions as a new form of colonialism

that contributes to the perpetuation of Western power over the Third World, through the

global consolidation of capitalistic dynamics in the best interest of Western capital, and

through the global spread of Western culture:

The organization of factors that development achieved contributes to the disciplining of labor, the extraction of surplus value, and the reorientation of consciousness… these strategies inevitably bypassed peasants’ culturally based conceptions. Beyond the economic goals, World Bank-style integrated rural development sought a radical cultural reconversion of rural life (Escobar, 1995: 145).

Consistently with this framework, Escobar considers the World Bank and similar

institutions of the “development apparatus” the tools used to submit Third World

peoples- tools of domination:

I started with a discussion of some features of institutions that, although apparently rational and neutral, are nevertheless part of the exercise of power in the modern world. The development apparatus inevitably relies on such practices and thus contributes to the domination of Third World people (Escobar, 1995: 152).

The Development Dictionary, a landmark critique of mainstream “development”

theory and practice edited by Wolfgang Sachs (Sachs, 1992) which bears the subtitle A

guide to knowledge as power, is a compendium of articles by some of the fiercest critics

of the field, including Escobar. 38



Claude Alvares considers in his chapter of the book that science and development

have functioned together in what he calls a “congenital” relationship in the post-colonial

era to the benefit of Western hegemony (Alvares, 1992: 230):

“Thus, just as the Europeans eliminated millions of indigenous Indians from North and South America and other indigenous populations elsewhere to make place for their own kind, and just as their medicine uprooted other medicine, and their seeds displaced other seed, so their knowledge project called modern science attempted to ridicule and wipe out all other ways of seeing, doing and having.”

In harmony with Susan Strange’s conception of knowledge as a major pillar of

structural power, Alvares states that “Knowledge is power, but power is also knowledge.

Power decides what is knowledge and what is not knowledge” (Alvares, 1992: 229-30).

Control by a few in the West of what is considered knowledge is the tool that allows the

domination not only of peoples in “less developed” countries, but also of ordinary people

all over the world:

“Thus planning, science and technology –the technocracy— now became the principal means for usurping the people’s rights to the domains of knowledge and production, for dismissing the people’s rights to create knowledge, and diminishing their right to intervene in matters of public interest or affecting their own subsistence and survival… the modern state’s interest in such development itself owed much to the latter’s constant search for ways and means to compromise, erode, and oftentimes severely diminish, personal autonomy, and the creativity and political freedom that went with it.”

Otto Ullrich, borrowing a phrase from Robert Jungk, states that through “technical

assistance” developing countries receive ‘trojan machines’ from industrialized countries

that “conquer their culture and society from within,” and believes that “the age of

Western imperialism is therefore not over by a long shot, particularly as long as there

exists, primarily on the part of the United States, a direct and open technological

imperialism against the countries of the Third World”(Ullrich, 1992: 284-86). 39



Another more tangible and very controversial subject regarding domination of the

South by the North has to do with Intellectual Property Rights (IPRs), and the new

framework for international enforcement, sponsored by the WTO and commonly called

TRIPs (Trade Related Intellectual Property Rights). Industries, mostly from the North,

that spend resources on research see patents and other tools related to IPRs as ways to get

repaid for their research investment costs. The North contends that the South, with weak

enforcement of IPRs, uses and benefits from expensive research done in the North

without paying for it. The South, in turn, complains that it has to pay for technology over

which it has no control whatsoever and which is being patented.

Vandana Shiva questions the basic tenet in which IPRs are based. She argues that the

prospect of profits guaranteed by an IPRs system, and therefore patents, are not necessary

for developing a climate of invention and creativity. According to Shiva, patents are very

important for big companies, mainly from the North, because they are instruments of

market control (Shiva, 1997).

With the North imposing the knowledge –belief— of what is the right way to

accomplish something, developing a technology accordingly, and finally charging the

South for the use of that technology, the circle of domination and South-North

dependency would be complete. Having this in mind it would be questionable even

whether technology, in this package, should be transferred at all to developing or less

developed countries. 40



Technology and the [natural] environment

Humankind has always affected the natural environment, especially in relation to its

quest for sources of food and energy. However this was not a major in pre-modern times

concern because the effects on the environment were local and small compared to the

scale of the planet, and there was always somewhere else to go if local resources became

scarce or polluted. The nuclear era starting with the atomic bombs during World War II

brought the first concerns that human beings were already able to affect the environment

at a global scale and in an irreversible way.

The continuous increase in the total natural resources used by humankind due to a

growing world population and the insatiable pursuit of growth and consumption

characteristic of Western ways of living prompted the Club of Rome to publish Limits to

Growth (1972), considered the first major work about the negative effects of human

activities on the natural environment at a global scale (Meadows and Club of Rome.,

1972). Without a significant change of course, the report predicted that our planet was

doomed in a few decades. Although time has proved wrong the timing of many of the

fatal predictions in the document, the basic concepts are still valid for the growing

minority concerned with the future of Earth if humankind does not change course.

In 1989 the World Commission on Environment and Development (WCED) issued

the commonly called Brundtland report, where the term “sustainable development” was

brought into mainstream. The report defined “sustainable development” as “development

that meets the needs of the present without compromising the ability of future generations 41



to meet their own needs” (World Commission on Environment and Development., 1987).

Although the authors expressed serious concern for our environment and emphasized the

need to take prompt action in order to avoid future catastrophes, they showed a more

optimistic picture and believed that it is possible to achieve “sustainability” and at the

same time continue with the focus on growth, which they think is essential for

overcoming poverty worldwide. This is completely opposed to the view of the Club of

Rome, which considers the emphasis on growth as one of the major causes of the

problem.

How does technology fit into this discussion? We can consider its involvement from

two different points of view: as a cause and as a solution. 42



Figure 5: Technology and the Environment



Generally technology itself is not specifically blamed for the impact human beings

have on the environment. It is true that some technologies are considered very harmful

for the environment, while others are considered friendlier or even “sustainable.” In terms

of energy, for example, nuclear energy is generally condemned for the very long-term

harmful effects of nuclear waste, and coal thermal energy and to a lesser extent oil and

gas based energy (either for electricity or transportation) are condemned for its emissions

of greenhouse gases (GHGs) and other harmful pollutants. On the other hand, renewable 43



energy technologies, and specifically wind energy, are considered friendlier. But the fact

is that it is technically impossible to supply current and projected levels of energy

consumption worldwide only with renewable energy neither now nor in decades to come.

The problem therefore is to be found beyond the technologies used, in the outstanding

consumption of resources that western ways of living demand.

Secondly, technology is looked at in this context as a solution. Those with a more

optimistic (some would say blind) view of the future of our environment believe that

human ingenuity will eventually be able to develop technologies that use energy and

produce goods in a more efficient and cleaner way, in a continuous process of survival

and adaptation to a changing environment. Humankind will therefore be able to avoid the

doomsday predicted by the most pessimistic. Of course the not-so-optimist argue that this

is no more than wishful thinking and an irresponsible and selfish position that leaves the

problem for future generations to solve.

In the field of “development” mainstream practitioners such as the World Bank

already incorporate officially an environmental assessment phase in the interventions

they sponsor. Most of the focus is placed on mitigating potential harmful environmental

effects of the technologies selected based on other criteria, and not in a genuine effort to

search for environmentally friendlier alternatives. Many argue that, typically, by the time

the environmental study is done development projects already have too much inertia to

allow the findings of the study to change its course substantially. This aspect will be

further discussed in chapters 4 and
# 44



On the other hand, advocates of intermediate or “appropriate” technologies argue

that the alternative technologies they support tend to be of more local character and of

smaller scale, and this fact is already a guarantee that their environmental impact will

normally be smaller. Environmental concerns constitute therefore another argument in

favor of the alternative technologies they promote.

Conclusion

As we have seen, the major differences among the various perspectives introduced

lie on the different grades of importance granted to the five aspects presented in our

framework figure: social, political, cultural, economic and environmental. Knowledge as

a set of beliefs –remember Susan Strange— is responsible for the assignment of those

grades of importance. When the whole world is made to believe that the economic aspect

is the more important, and everything else will come afterwards, that is already biasing

the decisions made regarding technology in societies in general, and in development

specifically.

One would expect that any project undertaken in the name of “development,” either

by states, bilateral or multilateral agencies, or private actors, would be informed by all

aspects presented here. Focusing on only one or a few of them and leaving aside the

others paves the way for, at best, an increased likelihood of unsuccessful or irrelevant

results, and at worst, actual damage to LDCs’ disenfranchised populations. 45

== 3. Development Interventions ==
We are trying to understand, for development interventions, how much consideration

is given to potential technological alternative ways to reach development goals. There are

three main questions to look at: when the decisions regarding the choice of technology

are made; by whom; and following what criteria.

But let us discuss first what a development intervention is. What are we exactly

talking about? In which form do development interventions take place.

Development interventions start with the identification of a current situation, as local

as that of a community or as global as that of a country or group of countries, that can be

improved. Then one or several goals are established according to what is considered an

improved situation. Finally, something has to be done in order to go from the current

situation to the desired one. Action needs to be taken by one or several actors. This

action, whatever form it takes, is what we call a development intervention. Actors

involved in the development intervention range from local people –the affected

population— or organizations, to others external or foreign to it. In development

interventions there is usually at least one actor that is professionally involved in the field

of development. Further discussion on the actors involved can be found below in the

section dedicated to stakeholder analysis. 46



What is a development project?

One of the most common forms development interventions took since the beginning

of the field of development field after WWII was the development project. Initially it was

mainly associated with infrastructure works in the public sector, but more recently, since

the 1980s and structural adjustment, it has been applied to things like institutional

development and improvement of skills and capabilities, and is often taken on by the

private sector.

Cusworth and Franks (Cusworth and Franks, 1993: 3) define projects in the context

of development this way:

A project is the investment of capital in a time-bound intervention to create productive assets.

The capital mentioned in the definition is both human and physical, and the assets

created can be physical, institutional, or human, and are assumed to remain once the

project is completed.

Potts (Potts, 2002: 12) lists several features that can be expected of development

projects:


* A project involves the investment of scarce resources for future benefit.


* A project can be planned, financed, and implemented as a unit.


* A project has a defined set of objectives and a specific start and end.


* A project has geographical or organizational boundaries.

These characteristics, which development projects share with projects in general,

make the project approach attractive, especially from a managerial point of view: projects 47



can be broken into smaller tasks that are easier to handle and can be scheduled, monitored

and adjusted to changes in plans; alternatives can be analyzed in a systematic way;

projects can be prioritized; costs and benefits can be relatively easily evaluated.

Many of this advantages stem from the time-bound nature of projects and the

specificity of their goals. Extreme caution has to be applied with the project approach,

though, because those same two features do not necessarily fit well with the nature of

development. Oxfam warns us against the careless use of development projects:

… while the processes of development do not have a clear beginning, middle, and end, projects do; and they also require plans, contracts, budgets, reporting schedules, and evaluations. While social and economic processes cannot be controlled by an outside agency, projects may be under external pressure to demonstrate a tangible and swift impact on these processes, which are not under their control; and risk losing their funding if they fail (Eade, et al., 1995: 21).

Oxfam emphasizes the need to understand development projects as part of a broader

social and political context and to incorporate flexibility in the project approach, lest

development projects impose demands that have to do more with development agencies

than the actual development of people.

This is the reason why there has been lately more emphasis on long-term programs

rather than time-bound projects. Although the distinction between programs and projects

is not always too clear, we can say in general that programs are of larger scope and scale,

and include several projects. A program to improve the livelihood of a rural area might

include projects to provide energy, to train in agricultural techniques, to train in

entrepreneurial and managerial skills, etc. 48



In any case, projects are after all the building blocks of programs, and the tool

through which changes are implemented on the field.

Project Cycle

In order to understand when in the life of a development project the decisions

regarding the choice of technology are made, we first need to understand the life cycle of

a development project. Projects tend to go through a series of relatively clearly defined

phases, what is commonly called the project cycle.

The traditional project cycle in development was formulated in 1970 by Baum based

on the processes of the World Bank at the time. It included four major components in

linear progression: identification, preparation, appraisal and implementation (Baum,

1970). In 1978 Baum revised his formulation of the project cycle and included a fifth

component, evaluation, that would include the provision of feedback to be used in future

interventions (Baum, 1978). This addition changes the linear progression into a circle,

and the feedback information obtained from the evaluation part allows for the

improvement of the current project as well as the provision of useful lessons for future

interventions. Figure 6 shows Baum’s project cycle. 49



Identification



Evaluation Preparation



Implementation Appraisal



Figure 6: Baum's project cycle Source: Baum 1978



In the first part, identification, a current situation suitable to be improved is

recognized. In a business environment a project will make sense when there is a demand

for the outputs of the project. It is important to distinguish between demand and need.

The existence of a demand implies the ability and willingness to pay for the outputs

provided by the project, while the existence of needs does not. In the field of

development very often there are needs for the outputs of the project, but not necessarily

demand in the sense explained above.

This first phase also includes the identification of available resources and at least one

potential technical solution to generate the required output from those resources. This

concerns the choice of technology in which this work is focused, and will be analyzed in

more depth in the next chapter. 50



In sum, the identification phase should: specify the goals of the project as regards its

output; list current obstacles for reaching the goals; explain alternative ways to achieve

the goals; and identify the resources required and the actors involved.

There are multiple ways in which projects are identified. The identification might

arise from a government planning process, from local NGOs or other civil organizations,

from private sector actors that see an opportunity for profit, from the local community,

etc. We will analyze the actors involved in this phase in the section on stakeholder

analysis below.

In the second phase, which Baum calls project preparation and is also often referred

to as project formulation, the scope of the project and all the details are specified to the

point where a definite decision can be made whether or not to go on with it. This decision

will take place in the following stage of appraisal.

During the preparation it is important to keep in mind who are the target

beneficiaries, what are the goals, what are the current constraints for the achievement of

those goals, and how does the project propose to overcome those constrains. If the

elaborated project proposal is prepared along these main axes, it will be much easier to

appraise it in the next stage. Indeed, [[international development agencies]] normally provide

specific guidelines for the preparation of this proposal. One of the main tools commonly

used is the Logical Framework, which will be discussed in the next chapter.

During this preparation work the conceptual project defined during the identification

phase is subjected to an analysis of its feasibility. The feasibility studies should determine 51



if it is possible to carry out the project according to the stated objectives with the

financial, technical, human, material, and institutional resources available.

It should also include an analysis and description of all suitable alternatives that

might be used to achieve the desired results. Alternative technological solutions, the main

concern of this thesis, should be proposed and reviewed during this stage. In the next

chapter we will have a closer look at how this process takes place.

The next phase is project appraisal, where the project is reviewed and the decision is

made whether to go ahead with it or not, and which of the remaining alternatives is

chosen. When loans are required from external agencies, as is commonly the case, these

external agencies provide specific guidelines for the appraisal process, which they often

carry out themselves.

According to Goodman and Love project appraisal needs to address two major

questions. First, will the project as it is designed meet its own objectives as well as the

wider needs of its location and nation? And second, how does the project compare with

other projects it may be competing with for funding? (Goodman, et al., 1980: 101).

This appraisal tries to understand what will happen if a particular proposal is

implemented, whether the expected outcome will occur, who will benefit and lose, when

will the outcome take place, and how efficient is the investment considering the resources

employed and the benefits generated. The appraisal of a project is always done against

major policy objectives like for example economic growth, basic needs satisfaction and

equity, environmental protection, etc. 52



The appraisal is based on the detailed and accurate information generated in the

previous phase and uses several well-established techniques for the analysis of this

information. These techniques include economic cost-benefit analysis, socio-economic

analysis, and environmental impact assessment, and will be discussed in the next chapter.

When there are a few alternative ways to define the final project to be implemented,

it is in this appraisal phase that the best alternative is chosen. For our main concern in this

thesis, the choice of technology, this phase is critical because it is here where, when there

is more than one potential technological solution, the final decision will be made as to

which one will be implemented.

Indeed the first two stages of the project cycle, identification, preparation and to

some extent also the appraisal phase, occur often not in a straight linear way one after

another, but more likely in an iterative back and forth process where the project proposal

gets progressively refined. It is in these three stages where any potential technological

alternatives would be considered. Once the project reaches the implementation stage

there is little room for changes in the technologies used. The next chapter will focus in

the procedures used to analyze and select project alternatives during the first stages of the

project, especially the appraisal phase, where the decisions regarding technology choice

take place.

After the appraisal follows the implementation phase where the project proposal is

executed and turned into tangible actions. Goodman and Love (Goodman, et al., 1980:

135) describe the tasks to be done during project implementation: 53




* Breaking down the project into its component tasks and activities;


* Assignment of tasks and activities to project team members, and detailed scheduling of these tasks;


* Allocation and use of resources such as personnel, finance, time and materials;


* Coordination, monitoring and control of the performance of the project team and the use of project resources in a manner which ensures the completion of all project activities in an orderly and optimal way.

Well established project management techniques and tools such as Ganntt and PERT

charts6 are used in this phase to facilitate monitoring and adjustments of the project,

improving project coherence and saving implementation time by separating problems into

their project components.

Finally, in the evaluation phase, the whole project will be re-analyzed in order to

provide feedback information which might be useful for future interventions, closing the

project cycle as a circle in an ideally continuous learning process. In this phase the

project performance is compared with the stated objectives. The idea is to understand the

reasons for the success or failure of the project, looking at what works and what does not,

so that errors are not repeated in future interventions. The evaluation exercise should look

at the impact of the project in target groups and their environment beyond the stated

goals, trying to understand any positive or negative unintended effects.



6 Commonly used project management tools initially developed for large and complex projects 54



The project cycle introduced here is a very common approach in the field of

development. There are others variants that feature slightly different divisions or naming

of the stages, or additional connections and loops between them.

The version presented here is a valid base to analyze the main goal of this work, the

choices of technology in development interventions. Regarding the first of the three

questions posed at the beginning of the chapter, when in the life of development

interventions decisions concerning the choice of technology are made, we see already

that they will most likely take place during the first three stages of the project cycle.

Stakeholder Analysis

Let us focus now on the second question regarding the choice of technology in

development interventions: who makes or influences the decisions. In order to answer

this question we have to understand who are the main actors typically involved in a

development project, and what their roles are.

One of the most important activities in development interventions is the

identification of people, groups, organizations, and institutions involved one way or

another in the project, especially if we have in mind that in the development context what

is important is that people themselves are the agents of their own change, and determine

the type and speed of that change. Stakeholder analysis is the name given to the tool

commonly used by development agencies to carry out this study. This tool facilitates not

only the identification of the key actors, but also the assessment of their level of support 55



or opposition to the project, and what is their likely behavior regarding the change to be

made.

In this section we will first describe the tool and later we will use it to identify the

stakeholders and their roles not for a specific development project –the typical

application—, but for a generic project. The goal is to figure out which of the

stakeholders involved in a development intervention would typically make decisions or

influence in some way the choice of technology.

There are a number of different approaches to the stakeholder analysis, but we are

going to explain and use here the proposal of the World Bank (Rietbergen-McCracken, et

al., 1997 module 2).

The first task, according to the World Bank, would be to identify all the potential

stakeholders of a project. From the perspective of the World Bank, an institution that

basically lends money, the list should include the borrower, beneficiaries, affected

groups, and other interest groups, including the Bank itself. Using the World Bank

perspective does not subtract generality to the approach, since in most development

interventions one or several institutions play the role of moneylender, be it a development

bank, a bilateral agency, a foundation, etc. The moneylender typically provides the

guidelines for the preparation and submission of the project proposal, including the

stakeholder analysis, and is in charge of project appraisal.

The Bank (Rietbergen-McCracken, et al., 1997) suggests answering the following

questions in order to make the list: 56



Who are potential beneficiaries?

Who might be adversely impacted?

Have vulnerable groups been identified?

Have supporters and opponents been identified?

What are the relationships among the stakeholders?

The second step would be to see the interests of each one of the stakeholders and the

potential impact, positive or negative, the project might have on those interests. These are

some questions suggested by the Bank (Rietbergen-McCracken, et al., 1997) for this step:

What are the stakeholders' expectations of the project?

What benefits are there likely to be for the stakeholders?

What resources might the stakeholder be able and willing to mobilize?

What stakeholder interests conflict with project goals?

The third step would be the assessment of the influence and importance of each

stakeholder for the success of the project. According to the World Bank (Rietbergen-

McCracken, et al., 1997), for each stakeholder group the following needs to be assessed:

Power and status (political, social, and economic);

Degree of organization;

Control of strategic resources;

Informal influence (e.g. personal connections);

Power relations with other stakeholders;

Importance to the success of the project.

Assessing the influence of each individual stakeholder means evaluating how much

power each has over the project, that is, what is the degree of control over the decision 57



making process, either directly or indirectly, that can make the implementation of the

project easier or harder. The influence may arise from a position of power, or from

informal connections with people in power.

The importance of each stakeholder for the project measures the degree of active

involvement by this stakeholder necessary for the achievement of the project goals. The

beneficiaries of a project are typically the most important for its success, since the project

exists in order to satisfy their needs. Oftentimes beneficiaries, with great level of

importance, have a relatively small level of influence – for example poor peasants in a

rural electrification project.

All the information collected in these three steps can be expressed in a visual way in

a table like this Stakeholder Analysis matrix proposed by the Bank. 58



Stakeholder Interest(s) at Effect of Project Importance of Stakeholder Degree of Influence of groups stake in relation on interest(s) for Success of Project Stakeholder over Project to project U= Unknown U=Unknown 1=Little/No importance 1=Little/No influence 2=Some importance 2=Some influence 3=Moderate importance 3=Moderate influence 4=Very important 4=Significant influence + 0 - 5=Critical player 5=Very influential



Table 1: Typical stakeholder table for a development project Source: Participatory Tools and Techniques. World Bank. Rietbergen-McCracken, 1997



Finally, the fourth step of the stakeholder analysis would be, from the Bank

perspective, the planning of the involvement of each stakeholder in the different phases

of the project. For that the Bank proposes filling out a table called participatory matrix

that typically looks like this one: 59



Type of participation Information-sharing Consultation Collaboration Empowerment Stage in Project (one-way flow) (two-way flow) (increasing control) (transfer of control over Process decisions and resources) Project Identification Preparation Appraisal Implementation, Supervision, and Monitoring

Table 2: Typical participatory matrix for a development project Source: Participatory Tools and Techniques. World Bank. Rietbergen-McCracken, 1997



There are four types of participation considered in the table. Stakeholders in the

information-sharing column will be provided with information about the project.

Stakeholders in the consultation column will be provided with information and their

opinions will be heard. Those in the collaboration column, otherwise called partnership,

are full partners in the specific stage of the project, have access to all the information and

discussions, and have a vote in the decisions made. Finally, stakeholders in the

empowerment column, often-called just control, are those who receive control, including

decision making, over specific tasks, but always under the supervision of the full

partners. Examples would be consultants hired to do research or prepare technical reports,

or contractors hired during the implementation phase.

The Bank (Rietbergen-McCracken, et al., 1997) provides several directives for the

involvement of stakeholders in the project according to their level of importance and

influence: 60



Stakeholders of high influence and high importance should be closely involved throughout to ensure their support for the project;

Stakeholders of high influence, low importance are not the target of the project but may oppose the intervention; they will therefore need, as appropriate, to be kept informed and their views acknowledged to avoid disruption or conflict;

Stakeholders of low influence, high importance require special efforts to ensure that their needs are met and their participation is meaningful; and

Stakeholders of low influence, low importance are unlikely to be closely involved in the project and require no special participation strategies (beyond any information-sharing strategies aimed at the "general public").

The Bank also recommends that the stakeholder analysis itself be done not only by

Bank staff, but also involving as much as possible other groups such as government

agencies, NGOs, academic institutions, etc, either bringing all of them together for

discussion, or through private hearings when there are sensitive issues to be discussed.

Overall the World Bank approach seems to make sense, and shows specific concern

for the participation of the important but less influential stakeholders, typically

beneficiaries of the project endowed with very limited resources.

Still, if we pay attention to the language, it says that stakeholders of high influence

and importance should be “closely involved” and even those of high influence and low

importance have to be “kept informed and their views acknowledged.” For those of low

influence and high importance the Bank talks of “special efforts to ensure their needs are

met and their participation is meaningful.” From the perspective of the World Bank the

most important thing is that the project goes through, and therefore stakeholders of high

influence are key. 61



Regarding this issue of stakeholders very important to the project but with low

influence, let us have a look at actual tools used to do the analysis. TeamUp-PCM is a

software application from a company called Team Technologies that assists with Project

Cycle Management processes. It is cited by Bell and Morse in their book Sustainability

indicators as an example for the carrying out of stakeholder analysis (Bell and Morse,

1999: 129). The table they use is reproduced below:



Table 3: Stakeholder Analysis table from TeamUp methodology and software Source: Sustainability Indicators. Bell and Morse, 1999



This table includes for each stakeholder one column called Value that measures its

importance for the project (1=lowest importance, 5=highest importance), and another 62



column called Power that measures its influence (1=lowest influence, 6=highest

influence). The tool automatically calculates another column called Impact that is the

product (multiplication) of Value and Power. Although Bell and Morse warn that this is a

very subjective value, they say that as a rule of thumb “any stakeholder with a score of

over 20 points in terms of impact should be taken seriously.” This represents a grave bias,

embedded in the methodology, towards powerful actors. A very important stakeholder

with the highest value (5) but low power (1) might not be granted the necessary level of

attention and involvement (impact=5).

After having described the stakeholder analysis tool, we are going to look at some

examples of its use in order to have a general idea of who are typically the actors

involved in each stage of a development intervention.

Let us first list typical stakeholders in development interventions:


* Donor agencies are the financers of the project, providing part or all of the money

needed to execute it. Although money from national governments or foundations is

often used in development projects, a great majority of them require some kind of

foreign financing, coming from donor agencies such as multilateral development

banks (World Bank, Asian Development Bank, Inter-American Development Bank,

etc), UN Agencies (UNDP, UNIDO, etc), bilateral agencies (USAID, DFID, etc), and

other donors such as foundations and big international NGOs. Donor agencies have

great power over development projects since they provide the funding. Without their

approval there is no project. 63




* Borrowers are those who ask for the money, submitting proposals for funding. For

relatively big projects the borrowers are typically national governments or their

agencies, and for smaller projects borrowers could be municipal and state

governments and even local NGOs or other type of local organizations. Borrowers are

also very important and have great influence over the project, since they propose it to

begin with, and often manage it from beginning to end.


* Civil society organizations that are involved in the project but are not direct

beneficiaries, such as local, national and international NGOs, private sector

organizations, professional groups, other civil society groups representing poor

sectors (Church leaders, trade unions, farmers’ unions), academic researchers,

politicians and political parties, communication media. Their level of importance and

influence varies greatly.


* Local beneficiaries are the directly affected groups, those who stand to benefit or lose

from the project. These often include the poor and the marginalized, representative

community-based organizations (CBOs), traditional and informal social networks,

and informal or temporary coalitions or social networks arising due to project

intervention. They are of the greatest importance for the project since they are

supposedly the reason why the project exists to begin with, but they have a low level

of influence in the existing power structure.

With this list of typical stakeholders in mind, let us look at our first example, a

private sector population project funded by the British ODA (Overseas Development 64



Administration), now known as DFID (Department for International Development). This

example is used by Montgomery in his book Resources in Social Development Practice

(Montgomery, 1996). Montgomery uses the table reproduced below to show the list of

identified stakeholders and their interests: 65



Interests Potential Relative project impact priorities of Secondary Stakeholders interest Ministry of Population * Achievement of targets (+) Welfare * Control over funds & activities (-) 3 * Avoid liability for any negative (-) reactions to contraceptive promotion Pharmaceutical companies, * Sales volume (+) & distributers * Profits (+/-) 2 * Public image (+/-) ODA * Institutional learning (+) * H & population objectives (+) * Short-term disbursements (-) 2 * Conserving staff inputs (?) * Avoid liability for any negative (-) reactions to contraceptive promotion Primary Stakeholders Lower-middle income * Reproductive choice (+) 1 groups * Cheaper contraceptives (-?) Women * Reproductive choice (+) * Enhanced health (+) 1 * Status (-/+) External stakeholders Islamic clergy * Social and religious influence (+/-) 4 Traditional birth attendants * Private incomes (-) 5

Explanatory note: As a private sector project, the Ministry may perceive a loss of control over resources. Several of the secondary stakeholders with positive interests in the project are wary of the social and religious influence of the clergy on public opinion (and therefore their image). The clergy are identified as a stakeholder group posing potential risks to the project.



Table 4: Stakeholder table for a private sector population project in Pakistan funded by ODA Source: Resources in Social Development Practice. Montgomery, 1996



The level of importance and influence of each one of the stakeholders is assessed

(according to ODA criteria) and based on that assessment the participation table is

designed for the project, as reproduced below: 66



Type of participation Stage in cycle Inform Consult Partnership Control * ODA * Pharmaceutical * Ministry of Identification companies Population & Welfare * ODA * Ministry of P&W * Womens groups * Pharmaceutical Planning * Clergy? * Health NGOs companies * Ministry of P&W * Health NGOs * Women's groups * Pharmaceutical Implementation * ODA * Clergy? companies * TCOs / PIU * Health NGOs * Women's groups * Pharmaceutical companies Monitoring & * TCOs / PIU * External Evaluation * ODA * Ministry * Ministry of P*W consultants

Table 5: Participation matrix for a private sector population project in Pakistan funded by ODA Source: Resources in Social Development Practice. Montgomery, 1996



For this participation matrix ODA considers together the preparation and appraisal

phases in what it calls planning. It is importance to notice how in the phases that are

critical for the definition of technological choices –as discussed above—, identification

and planning, the key stakeholders are ODA (the donor) and the Ministry of Population

and Welfare from the national government of the destination country (the borrower). The

purported beneficiaries, women’s groups, are not present at all in the identification phase,

and they are only to be consulted in the planning phase. On the other hand, very

influential but secondary stakeholders, the pharmaceutical companies, are to be consulted

during identification and become a full partner during the planning phase. 67



Our second example comes from DFID’s (former ODA) Guidance Manual on Water

Supply and Sanitation Projects and Programmes (Batteson, et al., 1998). The manual

shows an example of a Water Supply and Sanitation (WS&S) project, with the

stakeholder table reproduced below: 68



Table 6: Stakeholder table for Water Supply and Sanitation project funded by DFID Source: Guidance Manual on Water Supply and Sanitation Projects and Programmes. Batteson, 1998 69



After the level of importance and influence of the various stakeholders is evaluated

the participation matrix for the project is defined. It is reproduced below:



Table 7: Participation matrix for a Water Supply and Sanitation project funded by DFID Source: Guidance Manual on Water Supply and Sanitation Projects and Programmes. Batteson, 1998 70



In this second participation matrix we observe again how the donor (DFID) and the

borrower (Ministry of Water affairs) are present as partners in both phases were

alternatives are defined, identification and planning. In this case the purported

beneficiaries, community based organizations (CBOs) and women’s groups at least are to

be consulted during identification and become full partners during the planning phase.

Our third and final example comes from a book called Emergency Sanitation, based

on an emergency sanitation intervention that took place in Zambia in 2001 with the

involvement of DFID and Oxfam amongst others (Harvey, et al., 2002).

The authors propose a generic stakeholder table for this kind of projects that is

reproduced below: 71



Table 8: Stakeholder table for Emergency Sanitation projects Source: Emergency Sanitation. Harvey,
# 72



After the assessment of the levels of importance and influence of the different

players, a generic participatory matrix is proposed. It is reproduced here:



Table 9: Participatory matrix for an Emergency Sanitation Project Source: Emergency Sanitation. Harvey, 2002.



Since this type of intervention is considered emergency relief rather than

development, the identification of the needs or demands is different and definitely shorter

–there is urgent need. They call it Rapid assessment and priority setting. The remainder

phases are very similar, with the details of the intervention defined in the programme

design phase, then implementation, and finally monitoring and evaluation.

Again we see how in the first two phases, where alternative solutions can be

considered, the donor agency and the authorities (national, municipal or local 73



government) are major players at the level of partners. The beneficiaries, the community,

are only consulted in the first assessment phase, and become full partners in the design

phase.

From these three examples we can already infer something about who might be

involved in decisions having to do with the choice of technology. Those choices will

most likely be made during the identification, preparation and appraisal phases and, as we

have seen, the stakeholders that seem to be always important during those phases are the

donor, typically a multilateral development bank or bilateral development agency, and

the borrower, typically agencies from the national or regional government. These two

major stakeholders will have much to say regarding the choice of technology.

As for the beneficiaries, they do not seem to be an important partner in the

identification phase, although they might be during the planning phase. Their influence in

the decisions regarding the choice of technology will probably be limited.

Having the beneficiaries, especially when they have limited resources and education,

and limited organization capabilites, involved in the first phases of the project can be

frustrating for project managers and of low efficiency from their point of view. Bell and

Morse believe that all stakeholders should ideally provide their own assessment, but

acknowledge that this can be time consuming (Bell and Morse, 1999: 129). This is true,

but the full participation of the most important stakeholders, the beneficiaries and other

directly affected groups, is the key to achieve development according to their own 74



standards. In many cases a compromise will have to be reached between participation and

what project managers consider efficiency.

At this point we have already a rough answer to the first two questions posed about

the decisions regarding the choice of technology: when and by whom. As we have seen,

these decisions will most likely take place during the identification, planning and

appraisal stages of the project. The stakeholders that seem to be more important for those

decisions are the donor and the borrower. In some cases the beneficiaries might influence

those decisions too.

In order to know more details about the when and by whom, and to answer the third

question, using what criteria, the next chapter will analyze the procedures applied in

project analysis and appraisal. 75
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