Impact Assessment

From Project to Policy Reform: Experiences of German Development Cooperation, by Altenburg (ed.), DIE, 2007

    This substantial publication includes seven case studies of business environment reform work of GTZ and KfW. In each case, the results achieved are considered in the context of the Paris Declaration, to reflect on the merits of multi-level approaches. In other words, do interventions at the 'micro' level enhance the effectiveness of of interventions at the 'macro' level, or do they just confuse the picture? Tilman Altenburg's conclusions are reproduced below.

    Summary of results
    The examples gathered together in this volume confirm that multi-level policy approaches can be very successful in influencing policy. The technical quality of reform processes as well as ownership on the part of governments and affected stakeholders are likely to increase if policy options are tested in pilot projects and adapted to country needs.

    To achieve this within a particular development programme is, however, no easy task. The cases presented in this volume are selected success stories. Each required considerable time and manpower to develop and, even more importantly, each involved clear policy targets and an excellent programme management. In particular, it was necessary to specify clearly why certain micro-level projects are necessary and how they are expected to contribute to the policy reform process; to establish procedures for the documentation of pilot experiences and criteria for the assessment of findings; and to ensure that learning experiences are systematically conveyed to politicians and other decision-makers. In sum, a complex system of knowledge management is required, one with special emphasis on feedback loops from projects to the policy level and vice-versa. Without knowledge management and an upscaling strategy, it is unlikely that micro-level activities will truly become “pilots” with effective impacts on policy.

    The advantages of multi-level approaches are relevant both within traditional bilateral programmes with non-PRSP countries and within the new modality of country-led programmes in which donors co-finance national programmes and align with country systems for planning, implementation and monitoring. The examples of Vietnam and Tanzania show that it possible and promising to carry out micro-level projects as a means of testing specific policy solutions and injecting the related expertise into policy reforms in PRSP countries. It goes without saying that this requires enhanced donor coordination and alignment with country procedures.

    Many countries are still unwilling or unable to develop PRSPs and SWAPs and to encourage donors to align with these programmes. Where there are no clearly defined sector policies in place, donors may adopt a more active role in bringing stakeholders together, discussing policy options, supporting micro-level experiments, and coordinating policy formulation.

    In the long run, however, donors should make sure that host country institutions assume responsibility for managing these processes. The case studies provide evidence that this is happening. German support for watershed development in India, for example, started at a time when there was no coherent national policy in place for the purpose, but today the Government of India has set up national policy guidelines and funding mechanisms on the basis of the lessons learned from these early donor-financed pilot projects.

    Finally, it should be noted that donors have different options for influencing policy reforms at their disposal. Well managed multi-level programmes are an especially promising one. However, there is much scope to combine this approach with other policy instruments, such as programmes to intensify international high-level policy dialogue or to create networks of leading academics and policy think tanks, training programmes for future decision-makers, and tailor-made expert hearings. Making judicious use of all these instruments is likely to ensure enhanced impact on the policy level.