The Social Market Economy Model in Africa: A Policy Lesson in the Pursuit of an Inclusive Development
Open Access
- 30 August 2020
- journal article
- Published by Jimma University in PanAfrican Journal of Governance and Development (PJGD)
- Vol. 1 (2), 100-125
- https://doi.org/10.46404/panjogov.v1i2.2335
Abstract
A contextually rethought coexistence of capitalism and socialism, particularly, the ‘Third-Way’ politico-economic framework is a contemporary dominion in the pursuit of prosperous and inclusive development. Regarding the third-way position, however, there is a dearth of theoretical framework in African studies. Hence, this article aimed at exploring the theoretical significance of ordoliberalism and its social market economy model that is often praised as the secret(s) in the wake of the ‘Wirtschaftswunder’, meaning the ‘economic miracle’, of Germany. In so doing, the article has sought the common conceptual ground between the notions of the social market economy and inclusive development through the extensive review of theoretical evidence available in the secondary sources of data. The review of literature has revealed that unlike the German experience, the policy choice among the African countries, in the post-colonial era, was never consistent with ordoliberalism or social market economy. However, the post-2000 economic trajectory of Africa has shown the coexistence of the welfare state and coordinated market thereby creating a convenient condition to implement the lessons learned from the development path of Germany. Besides, the prevalent socio-economic problems in most of the Sub-Saharan African countries including demographic bulge, abject poverty, high levels of income inequality, extractive/rent-seeking institutions of governance, brain-drain, and aid/loan dependency syndrome are the major factors that underline the urgency for policy reforms geared towards an Afro-centric social market economy. Yet, the levels of economic development, historical, cultural, and geopolitical differences need to be taken into account to effectively implement the policy instruments of the social market economy in Africa.Keywords
This publication has 28 references indexed in Scilit:
- Another economic miracle? The German labor market and the Great RecessionIZA Journal of Labor Policy, 2012
- Veto Players: How Political Institutions WorkVeto Players: How Political Institutions Work. By George Tsebelis. (Princeton, New Jersey: Princeton University Press, 2002. Pp. 317. $18.95 paper)The Journal of Politics, 2004
- Civil Society and Japan’s Dysfunctional DemocracyJournal of Developing Societies, 2004
- Thinking about developmental states in AfricaCambridge Journal of Economics, 2001
- Considering the Third Revolution: Popular Movements in the Revolutionary EraLabour / Le Travail, 1999
- Development Policies in Southern Africa : The Impact of Structural Adjustment ProgrammesSouth African Journal of Economics, 1997
- Adjustment in AfricaDevelopment and Change, 1996
- The Logic of the Developmental StateComparative Politics, 1991
- InstitutionsJournal of Economic Perspectives, 1991
- Prospects and problems of the transition from agrarianism to socialism: The case of Angola, Guinea-Bissau and MozambiqueWorld Development, 1981