Positive Institutional Change from the Ground Up: A Case Study of a Community-led Collaborative Governance Process

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Naji P. Makarem, University of California, Los Angeles

Abstract
Recent theoretical advancements in the field of new institutional economics highlight the critical importance of the interaction of formal and informal institutions on socio-economic outcomes at multiple scales. The literature however falls short of explaining transition processes and strategies towards higher levels of balanced community/society interaction. This case study contributes to this new theoretical breakthrough by evaluating the transition of Jardim Gramacho, a neighbourhood of 20,000 low-income residents in Rio de Janeiro, from a worse-case scenario of low ‘community’ and low ‘society’ to a sub-optimal albeit improved scenario of higher ‘community’. Although not generalizable this case study raises the hypothesis that such a transition in institutional arrangements is achievable through a community-led collaborative governance process implementing a strategy of empowerment planning. I draw on theory of network power for understanding the dynamics behind the positive institutional changes evident in this case study, as well as prospects for continued progress towards higher levels of more balanced community/society interaction. I argue that such institutional change at multiple scales is integral to the process of aligning economic development with the needs of people and the environment, thus integral to the process of making our economies more sustainable.

Recent theoretical breakthrough in the field of new institutional economics bridges the intellectual divide between proponents of formal institutions (‘society’) on one hand, and informal institutions (‘community’) on the other, as key explanatory variables in socio-economic outcomes. This emerging theory¹ highlights the synergistic nature of community/society interaction at various scales, its expected impact on socioeconomic outcomes and the expected pace of change of institutional arrangements through social forces.

This emerging theory however, despite its seminal contribution to the field of new institutional economics and economic development more generally, paints a static picture of institutional dynamics within a comprehensive spectrum of possible institutional arrangements. In other words community/society interaction theory has a great deal to say about the expected impact of various degrees of community and society development and interaction on socioeconomic outcomes, as well as the expected pace of change of institutional arrangements depending on the degree of imbalance between the two, but falls short of explaining how communities at various scales can consciously shape institutional arrangements. Since community/society interaction is now understood to be a critical factor in socioeconomic outcomes, understanding how institutional arrangements can be shaped and developed by stakeholders is paramount to the socioeconomic development process.

Furthermore, such a dynamic picture of community/society interaction is critical to the ongoing process of aligning our economies with the needs of people and the environment, a struggle towards sustainable development. Unsustainable development emerges when social and/or environmental costs are externalized from decision-making criteria. By including stakeholders in institutional arrangements, such costs are brought in to the decision-making process. Again, understanding dynamic transition strategies and processes towards higher levels of community/society interaction at various scales is critical to achieving such inclusive and collaborative governance processes that promise to steer our economies in more sustainable trajectories.

In this article I attempt to contribute to this emerging literature by examining a dynamic transition process in institutional arrangements in a neighborhood of 20,000 low-income residents in Rio de Janeiro. As I will argue, the neighborhood achieved a transition from low community and low society to higher community. This transition was achieved through a community-led collaborative governance process by implementing a strategy of empowerment planning. Although not generalizable, my findings raise an interesting hypothesis on a neighbourhood-level process and strategy for achieving such a positive transition in institutional arrangements. I draw on theory of network power to better explain the success behind the initiatives to date, and to theorize on expected future transitions towards higher levels of more balanced community/society interaction.

I will begin by discussing community/society interaction theory and its arguably seminal contribution in the field of new institutional economics. The case study that follows evaluates the work done to date by the Jardim Gramacho Community Forum. Achievements, challenges, and future prospects are then discussed in context of theory on network power and community/society interaction theory. I conclude with a summary of my findings and proposed future research.

Community/Society Interaction Theory in New Institutional Economics

The field of regional economic development theory has long been struggling to explain why some regions grow faster than others, and why despite neoclassical predictions of convergence, a combination of technological change, and free-trade globalization accompanied by economic restructuring had coincided with increased regional polarization on a world scale.²

Government policies based on redistribution for social welfare and top-down industrial policies (such as the regional commissions in the U.S. between 1930-1950, growth pole strategies in Latin America, Italy and the Middle East between 1950-1970, and more recent structural funds in the EU) have in many cases failed to counteract the polarizing forces of globalization and to overcome the persistent under performance of lagging regions.

Economic sociologists, economists, and political scientists began to argue that the effectiveness of policies depended on the institutional context.³This proposition could explain the shortcomings of neoclassical theory and its updated version of new growth theory in finding generalizable growth equations (in other words the economic impact of the institutional context could explain the extent of the error factor in growth regressions).

New Institutional Economics literature highlights the importance of formal and informal institutions on economic outcomes. Institutions refer to public and private economic institutions, governance structure, and social capital. Douglas North and his school provide a clear institutional framework which describes a continuum with “unwritten taboos, customs, and traditions on one end and constitutions and laws governing economics and politics on the other”.⁴An ongoing debate in the broader New Institutional Economics literature can be characterized as a tug-of-war between proponents on either side of this continuum, with sociologists, geographers, and some economists stressing the importance of informal institutions on favorable economic outcomes (namely social capital, culture, and civil society), and most economists stressing the importance of formal institutions (namely the rule of law, property rights, the judiciary, and government institutions).

Robert Putnam⁵ and Fukuyama⁶ highlight the trust generated from institutions of community (social capital), while others have pointed to other benefits of communities such as lower transactions costs, public goods provision, improved market organisation, limiting moral hazard, free riding, mitigating information asymmetries, and aligning individual with collective interests.⁷These arguments have been supported with qualitative and quantitative studies.

Counter to these perspectives however, many have argued that informal community institutions are a second best to formal societal institutions, and even propose that community institutions can harm economic outcomes through “rent-seeking, insider-outsider problems, clientelism, and nepotistic practices.”⁸

Furthermore, scholars have proposed that high societal institutions in the absence of strong community institutions risk societal conflicts and consequently high transactions costs, poor conflict resolution, and inadequate public goods production in the fields of education, healthcare, human resource development, environmental management, and technological innovation. These public goods generate positive externalities and can be produced through widespread group organization that widens the constituencies for such goods.⁹

Rodriguez-Pose and Storper¹⁰ transcend this ideological divide with their theoretical model of the complementary nature of both society and community. Society “generally refers to institutions that are defined by more transparent and codified rules”¹¹, such as those that create and enforce regulation and the rule of law; and ‘community’ refers to features of group life such as “traditions and social conventions, interpersonal contacts, relationships and informal networks”,¹²often referred to as social capital and civic society in contemporary literature. They argue that both are necessary in order to counteract the potentially negative externalities of one operating in isolation from the other, and for the positive externalities of both to emerge, thus maximizing the problem solving ability of an area to adapt to change.

According to this theoretical model, three key incentives necessary for long-term economic development emerge through the optimal interaction of high community (characterized by bonding) and high society (characterized by bridging): Confidence; effective and acceptable distributional tradeoffs; and successful ongoing problem resolution.

The authors cite countries such as Finland, Norway, Denmark, and Sweden as examples of high community/society interaction. Such countries, they argue, have responded well to the challenges of globalization through superior problem solving capabilities, precisely because of their high community and high society balance. The pace of change in institutional arrangement in these countries will be slow because a balance has been struck, in this case fortuitously at the high end of the matrix. Equally balanced and slow changing institutional arrangements exist at the other extreme of the spectrum (worse-case scenario), with countries such as Iraq and Afghanistan, where war wiped out a great deal of pre-existing institutional arrangements, and Russia, where a misguided economic transition strategy had the same detrimental effect.¹³

Furthermore, equal levels of community/society development can interact in a multitude of ways, yielding very different outcomes depending on the specific ways in which societal frameworks and communities are configured and interact. Countries such as France, Italy, Germany, and the United States have high levels of community and society interaction, albeit with different institutional arrangements yielding very different outcomes. In the European countries coordinated economies are manifest, while in the U.S. a more liberal economy has emerged.

Turning to the scale of the city and the region, political scientists Fung and Wright¹⁴offer important insights on the design characteristics of existing models of high community/society interaction, with their theory of Empowered Deliberative Democracy (EDD). They develop their theory following in-depth analyses of five case studies of institutional arrangements that have formally integrated the participation of local residents and stakeholders in various local government activities, including budgeting (Porto Alegre) and social services (Chicago).

EDD is characterized by two key design characteristics: bottomup participation enriches the governance process with a variety of knowledge and experiences, increases accountability, and reduces the bureaucratic chain of decision-making, thus reducing patronage and corruption. This design characteristic is comparable to high community.

Centralized supervision and coordination are also essential for a functional EDD process, designed to increase accountability, allow for the coordination and distribution of resources, solve problems that cannot be solved locally, rectify pathological and incompetent decisions, diffuse innovation and learning across regions, and allow for crossterritorial benchmarking. This aspect of a functional EDD process is comparable to high society. The EDD model can thus be understood as a specific type of high community/society interaction at the regional or city scale.

Community/society interaction theory is also consistent with the networked or associationalism paradigm that emerged out of the debate about competitiveness and cohesion.¹⁵Following evidence of persistent geographically uneven development, economic sociologists, economists, and political scientists began to argue that the effectiveness of policies depended on the institutional context.

These diverse schools of thought converged into what is known as New Institutionalism. This “new paradigm”, to quote Morgan,¹⁶argues that competitiveness and cohesion can be reconciled through collaborative governance at the local level by harnessing local assets and generating synergies through the collaboration and participation of a diverse range of stakeholders from public, private, and community organizations.¹⁷The goals of such collaborative governance could be social, economic, and/or environmental.

Moving from a static to a dynamic understanding of community/ society interaction, the authors argue that the higher the imbalance between society and community (where one is high and the other low), the faster will be the expected pace of change in response to exogenous or endogenous shocks (such as war or revolution) and/or processes (such as globalization or devolution). Note that the speed of change refers to change in institutional arrangements through social forces. This dynamic is illustrated in Figure 1 below:

Figure 1: The Speed of Change in the Community (c) / Society (s) Relationship

Source: Storper and Rodriguez-Pose (2006), “Better Rules or Stronger Communities? On the Social Foundations of Institutional Change and Its Economic Effects”, Economic Geography 82(1): 1–25- Figure 3, pp. 15.

The (s) on the y-axis is society and the (c) on the x-axis is community, both ranging from low (zero) to high. The straight line represents all the possible points where community and society are equally developed (or underdeveloped). The optimal or best-case scenario of high community and high society interaction would place a socioeconomic entity (be it a neighborhood, a city-region or a country) towards the top right of the straight line. Conversely, a worst-case scenario of low community and low society would be towards the bottom left of the straight line. Suboptimal scenarios would entail an imbalance between community and society, whereby one is more developed than the other. The bigger the gap between society and community, the further the economic entity would be from the straight line (high community and low society for example would be towards the bottom right of Figure 1).

The authors argue that when community and society are balanced (i.e. developed to the same extent anywhere along the straight line from low/low – bottom left – to high/high – top right), the speed of change of institutional arrangements will be slow. Alternatively, when there is an imbalance between the extent of community and society (where one is stronger or more developed than the other), the speed of change of institutional arrangements will be higher, and increase as the disparity between community and society widens. In other words the further the economic entity is from the middle straight line (whether towards the top left or bottom right quadrants of Figure 1), the faster the expected speed of change towards either better or worse-case scenarios of balanced community/society interaction (i.e. anywhere along the straight line).

The authors contend that the direction of change is more complex than standard theories predict, allowing a multitude of factors to direct change in numerous directions (positive or negative) depending on the context, including institutionalizing counter forces (or strategies) in response to changes in either community or society, rendering prediction and control much more difficult if at all possible. Rather than abandoning theory in light of this complexity, the authors call for “additional refinements in the way in which we understand that process can affect outcomes.”¹⁸

This theory offers us a powerful theoretical understanding of the potential dynamics between community and society and their combined effects on development. It also offers us a framework for understanding the socioeconomic impacts of institutional arrangements in specific contexts,¹⁹ and the expected speed of change of institutional arrangements at any given community/society balance.

Above all, it highlights the critical importance of civil society and social capital in interaction with formal institutions such as government and the judiciary and in socioeconomic development outcomes at various scales. This is revolutionary in the field of economics, where such considerations were considered exogenous to the economic development process by classical and neoclassical economic theories. This is arguably what civil society at multiple scales, including a global civil movement at a world scale, has been increasingly striving for over the past few decades, in a struggle to generate more sustainable and equitable development.

The movement toward sustainable development attempts to highlight the external costs of economic growth, and to internalize such costs into a priori decision criteria, thus aligning economic decisions with the needs of people (present and future generations) and the environment. The inclusion of stakeholders in governance processes through high levels of community/society interaction offers stakeholders whom otherwise would bear the burden of such costs the opportunity to insure they are accounted for in decision-making criteria.

Community/society interaction theory offers an economics-based theoretical argument for high levels of community/society interaction for achieving positive economic outcomes. Furthermore, it highlights the synergistic nature of community and society interaction, which in sustainability discourse has profound implications, as through their interaction with societal institutions such as government and the judiciary, civil society at any given scale gains the opportunity to leverage societal institutions to achieve its goals, and potentially align economic development with the needs of diverse stakeholders. For example, referring back to our discussion about internalizing social and environmental costs in decision criteria, through the interaction with societal institutions, civil society can potentially gain access to societal levers of control such as the rule of law, and consequently enforce the internalization of such costs through formal institutional arrangements. The process by which community can achieve such high levels of interaction with equally well developed society is precisely where the gap is in the literature, and where I hope to contribute, albeit fractionally, in this article.

In the case study that follows I will argue that the initiatives of the Jardim Gramacho Community Forum amount to precisely such a transition in institutional arrangements, in this case from a near worsecase scenario of low community and low society, to higher community.

Case Study: The Forum Communitario de Jardim Gramacho

This case study is based on in-depth interviews with participants from all four working groups of the Jardim Gramacho Community Forum and IBASE (The Braizilian Institute of Social and Economic analysis, a leading NGO facilitating the initiative), several visits to the neighborhood of Jardim Gramacho, attendance at several forum meetings, numerous informal conversations with participants and residents, and access to research conducted to date. My research was conducted during an eight month period between September 2007 and April 2008.²⁰

I will begin with a brief background of the case study, followed by an analysis of the project’s theory of change. An evaluation²¹ of the process, outcomes, and obstacles to progress follows, using the evaluative model developed by Innes and Booher.²² Achievements, challenges, and future prospects are discussed in context of the theory of community/ society interaction and the theory of network power which I will discuss later. I conclude with a summary of our findings and proposed future research.

Case Background Despite having the second largest tax base of the ninety-two municipalities of the state of Rio de Janeiro, Duque de Caxias is ranked fifty-second by the Human Rights Index, which includes life expectancy, education, and wages. Jardim Gramacho, a neighborhood of Duque de Caxias, is one of the municipality’s poorest neighbourhoods and is home to one of Latin America’s largest landfill, the Metropolitan Landfill of Jardim Gramacho, spanning over 40,000 square kilometers.²³

An estimated sixty percent of Jardim Gramacho’s 20,000 residents either directly or indirectly live off the landfill that lies at the heart of their.²⁴ Over 600 trucks dump an average of 8,000 tons of garbage per day from six municipalities including Rio de Janeiro, with detrimental health and environmental impacts.

Yet without this socio-environmental tragedy an estimated 3,000 official and unofficial ‘catadores’ or ‘collectors’ (people who collect recyclable material for sale) would not earn between $R600 and $R1,200 per month (between $265 and $530 at March 2009 exchange rates) collecting recyclable material and selling it off to the market.²⁵ These ‘collectors’, most of whom (sixty-seven percent) work seven days a week, many (thirty-seven percent) day and night, support a large part of the local population by spending their hard-earned income in local shops and bars, often entering a spiral of debt to finance their consumption.

In 2005, following civil disobedience by collectors which attracted the attention of the media and local government officials (they closed off the main artery to the landfill by turning over cars and setting them ablaze), local community organizations were brought together to collaborate for the first time. The Jardim Gramacho Community Forum (the forum from here-on) was launched with the support of the NGOs IBASE, FURNAS Centrais Electricas, and Comunidade COEP. IBASE is known for its community building and mobilizing approach to community development and is one of the founders of the World Social Forums through the leadership and vision of its director Candido Grzybowski.

As will become evident in the following section, the dynamics and strategies of the forum were not pre-defined or consciously planned, but rather emerged from genuine collaboration between diverse community organisations through a process facilitated by IBASE, founded on their explicit theory of change.

Theory of Change IBASE’s explicit theory of change is based on generating “active and participatory citizenship made up of social subjects struggling and working in their communities to build civil society, economy, and power, all this in a spirit of equality and diversity.”²⁶ IBASE believes this process to be an expression of radical democracy. This broad theory of change allows for each community they work with to invent their own ‘theory of change’, through the participation of community members, to fit their unique local contexts.

Forum participants decided to organize themselves into a unified voice that could speak for itself and approach local public service providers together to demand their rights to better access to public services. (Details of the process and how it came about will follow.) This strategy for change, which as will become apparent emerged from numerous collaborative meetings and innovative exercises, amounts to a theory of change synonymous with an empowerment planning strategy, whereby local stakeholders develop voice with the objective of increasing the responsiveness of formal institutions.

Empowerment planning is a product of advocacy planning and participatory methods. In advocacy planning, “planners speak for or advocate on behalf of marginalized communities.”²⁷ Participatory methods implement “a process of social change that involves participants in identifying their own problems (research); acquiring the skills needed to address these problem (education and training); and implementing a plan (action).”²⁸ By adding participatory methods to advocacy planning, empowerment planning “attempts to mobilize and build capacity of disenfranchised communities to speak for themselves.”²⁹ Empowerment planning is a specific type of collaborative governance process.³⁰

Evaluation I begin by evaluating the process of the forum, followed by an evaluation of tangible and intangible outcomes and finally major obstacles to progress.

The Process The process can be categorised into three phases that reflect the three broad phases of collaborative planning³¹ as outlined in Figure 2.

Figure 2: The Jardim Gramacho Community Form Process

PHASE I – Collaborative problem-setting
         a. Activities:
                   i. Interviews
                   ii. Discussion groups
                  iii. Participatory consolidation day
b. Products:
                  i. Diagnostic of Jardim Gramacho (a research report on the
                     state of the neighbourhood)
PHASE II – Direction setting, structuring and official launch of the forum
          a. Activities:
                  i. Various ‘integration meetings’ (collaborative meetings)
                 ii. Launching of the forum structured around four ‘working
                      groups’
          b. Products:
                 i. Action plan (a printed high-quality color leaflet)
PHASE III – Implementation through individual and collective action
          a. Activities:
                 i. Training courses for individual community leaders
                 ii. Meetings with local government officials and departments
                 iii. Mobilising local residents around specific issues
                 iv. Networking at national and international level forums
                 v. Implementing other action points

Source: Author’s interpretation of the forum process, based on the three-phased collaborative planning process developed by Gray, 1989-57.

Phase I: Collaborative Problem-Setting In 2005, all known local community organizations were invited by IBASE for what Rita Brandão, IBASE’s community organizer, described in an interview as “a discussion and action proposition for the neighborhood.” That was the first time that diverse community organizations, many of whom had never met before, came together under one roof.

Participants were driven by a real and practical purpose to improve the quality of life for residents in Jardim Gramacho. One participant explains: “We were invited to join by IBASE. It was about how to help the community. What does the community need? We all had the same objective: To improve the neighbourhood.” Another elaborated: “I always thought about questions relating to my neighbourhood. I just want it to be a nice place, a safe place… we have to struggle for change as opposed to wait for someone else to do something… I believe in a good future for this neighborhood and for our children.”

Following the first meeting when a consensus emerged that collaboration and collective action was needed to improve the quality of life for residents in the neighborhood, IBASE conducted a series of interviews with participants to identify what people thought were the main problems in the neighborhood. This information was collated into a summary and shared with all participants in a public event (a participatory consolidation day). Participants were surrounded by the results of their interviews which were pasted across the walls. A public dialogue about the problems facing the neighbourhood took place on the basis of the information collated from all participants, and eventually a consensus emerged about the area’s major problems. This shared meaning was captured by IBASE and made public in the format of a document called the Jardim Gramacho Diagnostic.³²

The diagnostic was a very important document as it empowered participants who saw their words in printed format, and reflected a newfound shared perspective amongst participants who previously viewed their neighborhood from their narrow perspectives based on their areas of specialization. This document was based on two sources of information: the input of all participants and research previously conducted by professional researchers. No information was included in the document without complete agreement from all participants. The diagnostic thus united diverse participants with shared meaning, an integral force to the future of the forum.

Phase II: Direction Setting, Structuring, and Official Launch of the Forum Various collaborative meetings and events followed the diagnostic, each with its unique dynamic for engaging participants through authentic dialogue.³³ From these innovative participatory events a consensus emerged around a unique network structure for the forum, one very different from the institutional set-up envisioned by IBASE that would have included a board of directors as an accountable, democratically elected body.

These innovative, collaborative, and participative events were a powerful way of engaging participants and generating interest. These initial events set the mood for subsequent meetings.

At the early stages in 2005 most participants had just met each other in these preliminary meetings and events, so levels of trust between participants were consequently low. Most participants only knew the few members from their sector of specialization, with whom they enjoyed higher levels of trust and friendship. Participants thus decided to structure the forum into four working groups, each one specializing on a specific sector: education; health; social programs and quality of life in the neighborhood; and work and income.

Following these collaborative meetings and events, the official Jardim Gramacho Forum, a self-organizing network of diverse community organizations committed to a process of consensus building, joint learning and collective action aimed at increasing the quality of life of residents in Jardim Gramacho, was launched in March 2006. One participant explained: “Decisions are made through dialogue. It’s always been easy to reach a consensus because we all have the same objectives.”

Prior to the forum, each community organization worked in isolation on a narrow range of issues within their sector of specialization. Participants quickly recognized the potential of better serving the neighborhood by gaining a broader perspective of the problems facing their community and by working in collaboration with organizations from other sectors. In the words of one participant: “As trust increased, communication between organizations increased as well, and people started helping each other”.

Through various integration meetings (collaborative meetings) within and between the four working groups, participants jointly developed a plan of action to solve the major problems identified in the diagnostic. The action plan followed the structure of the forum with each working group outlining a set of targets (identified in the diagnostic), and several clearly defined action points for achieving each of these goals.

PHASE III: Implementation through Individual and Collective Action Once the forum was officially launched as an autonomous network, with a new sense of shared meaning and a broadening perspective amongst its diverse participants, the four working groups began implementing the action plan. This often required collective action across two or more working groups, with all four collaborating on many of the action points.

Approaching public and private service providers together, a strategy at the heart of their theory of change was reflected in each of the working group’s action points. Despite separating action points across the four groups, all four approached service providers together, as a single unified network representing the neighbourhood of Jardim Gramacho. This critical mass surprised public service providers in particular, who were impressed with what they perceived as a new powerful political force in the community. Rita Brandão from IBASE explains:

The forum is made up of around thirty organisations, each servicing hundreds or thousands of residents. The forum therefore became a powerful ‘formador do opinao no bairro’ (shaper of local public opinion). Consequently, local government departments had a high level of respect for the forum and its power to mobilize the local population. In fact their perceived power was higher than in reality.”

As the forum began implementing its action plan it quickly became apparent that achieving the forum’s goals meant challenging the status quo which was being maintained by a few people who possessed a great deal of political power in the area, and whose interests were served by it. The above strategy of collectively lobbying public and private service providers was paralleled with several initiatives to mobilize local residents in support of the forum’s demands by spreading awareness of the process and collecting signatures as evidence of popular support.

Two years after the launch in March 2006 the forum continues to meet on a monthly basis and each working group also meets separately once a month. The vast majority of action points have been executed with various degrees of success (see outcomes) while some remain in the pipeline, delayed due to a lack of time and perceived relative importance. Furthermore, participants have been to various training sessions and national and international forums, increasing their individual and collective capabilities and knowledge (discussed in more detail in a subsequent section).

From this analysis of the process, it is arguable that the forum followed a consensus building process as per Innes and Booher’s³⁴ theory of consensus building,³⁵ and can thus be declared a genuine collaborative governance initiative. As summarized below, the process adheres to the criteria of a consensus building process, what Innes and Booher argue is a fractal of a collaborative governance process:

The forum is a self-organizing network of diverse and interdependent participants mainly from local community organizations.
They have engaged in authentic dialogue, and from this process they successfully developed shared meaning as captured by the diagnostic and the action plan.
The action plan aims to achieve real and practical tasks through collective action, driven by real and practical purpose: to improve the quality of life in Jardim Gramacho, often by challenging the status-quo.
The structure of the forum and its theory of change based on a strategy of empowerment planning have emerged from this collaborative process by fostering creative thinking with the support of high quality information of many types.

Outcomes

Over the past two years, through a process of authentic dialogue and collective action, the forum’s diverse range of stakeholders achieved a set of tangible and intangible outcomes that continue to materialize and impact on the quality of life of residents in Jardim Gramacho. I will begin by examining intangible outcomes, followed by tangible outcomes.

Intangible Outcomes On the whole, when participants first came together they were not acquainted, particularly those who operated in different community sectors. This is evidence of the lack of communication and collaboration between community organizations prior to the forum. Over time however the level of trust between participants began to develop, culminating in a board of directors being elected in 2007, which was needed to administer funds. A representative was chosen from each working group. As one participant explained: “Through dialogue we realized that our objectives were the same. Personally I don’t usually trust anyone, but through our shared objectives we began to trust each other.”

Intangible Outcomes On the whole, when participants first came together they were not acquainted, particularly those who operated in different community sectors. This is evidence of the lack of communication and collaboration between community organizations prior to the forum. Over time however the level of trust between participants began to develop, culminating in a board of directors being elected in 2007, which was needed to administer funds. A representative was chosen from each working group. As one participant explained: “Through dialogue we realized that our objectives were the same. Personally I don’t usually trust anyone, but through our shared objectives we began to trust each other.”

As well as evident increases in social capital, participants gained intellectual capital. Whereas prior to the forum participants concentrated on their narrow sectors of specialization, today participants enjoy a broad understanding of the multifaceted reality of their neighborhood, as evidenced by the diagnostic and the action plan. One participant explained:

I knew a lot [before the forum] because I worked in the streets and I’ve always been interested in development. But with the forum I learned about other organisations as opposed to just education. For example I learned about health, employment and the plight of the ‘collectors’. Now I feel I know about all the problems of the neighbourhood.

Furthermore, IBASE and other institutions sponsored specialized courses and events to meet the specific demands of many participants, whose newfound knowledge is shared with the network through discussions and actions. Four participants, for example, enrolled in a one day course on the environment organized by the state environmental agency; several consultants were invited to speak to the forum over a period of three days about the structures of social movements; and one participant attended a capacity building course organized by the Council of Rio de Janeiro.

Arguably the most important intangible outcome to emerge from this process was political capital. Participants learned to work together in collective action, and learned how much more can be achieved by collaborating on action points rather than working alone. Participants also learned to navigate a complex and politicized local and state government apparatus. They learned who are their allies and enemies and what are the major political bottlenecks standing in the way of progress (see ‘Obstacles’ below). They also learned to rally popular support for specific campaigns to influence public social service providers.

Finally, the process has led to numerous high-quality agreements between community organizations, which have produced mutualgain solutions. These agreements are based around a common vision of problems, an agreed upon action plan of innovative strategies, and collective action that has materialized into numerous tangible outcomes.

Tangible Outcomes Many of the goals identified and made explicit in the action plan were achieved by approaching service providers and demanding that service be extended to the neighbourhood. Others were achieved by applying for funding from NGOs and charities. As a direct result of participants’ increased capacity to collaborate, apply for funding, manage funds and negotiate with service providers, the forum successfully applied for funding from NGOs, negotiated better service provision from government institutions, and generated synergies from the collaboration of local community organizations (members of the forum) on specific projects.

Tangible outcomes from collaboration between community organizations, increased funding and government service provision include the building of a state of the art center for the forum with conference rooms and multiple computer access points for residents (by successfully applying for NGO funding and managing the budget); extending roads and sanitation services to the entire neighborhood (by approaching government departments as a unified body); the building of a school and a community day care center, improved local schools with more courses, better scheduling, the construction of a library and swimming pool, creating more direct and democratic channels for accessing school places, free literacy courses for adults, cultural events, the official registration of residents, and a public event for increasing awareness of health issues (achieved by raising funds from the ministry of education and non-governmental organizations, as well as better collaboration between the schools and other community organizations).

Furthermore the following products were created: the diagnostic and the action plan; a feasibility study for collecting separated garbage from residents (this was achieved with the help of the NGOs supporting the forum and promises to generate added value to the collectors); a feasibility study for a community agricultural patch; and the feasibility study for refurbishing the community sports center.

Obstacles

The biggest obstacles to progress were identified at the political/ institutional (society) level, namely a dysfunctional system of democratic representation through the variador (the councilman with disproportionate power in Jardim Gramacho), and inefficient government institutions to create regulation and uphold the rule of law.

Dysfunctional System of Democratic Representation (Corrupt Leadership) In theory councilmen are supposed to operate at a municipal level and the council is supposed to act as a democratic and representative body that ensures the legitimacy and accountability of the mayor and local government departments. According to the interpretation of interviewees, however, the system evolved contrary to its intended democratic ideals, with a single councilman concentrating on the first district of the municipality, and consequently the neighborhood of Jardim Gramacho (rather than all councilmen being accountable to the district), a sufficient geographical scope to secure votes for reelection.

Within this narrow geographic scope the councilman has allies whom he counts on for votes, in return for reciprocity in the form of political favors. Although the mayor and councilman enjoy some degree of autonomy, many of his decisions must gain the support of the council. The councilman is therefore engaged in a series of politically charged negotiations, trading support for decisions as negotiating chips. Furthermore, the councilman is supported by the mayor who in return gains his votes, adding to the complexity and lack of transparency of a dysfunctional political process in the first district of Duque de Caxias, and Jardim Gramacho by default.³⁶

Jardim Gramacho falls under the jurisdiction of a councilman who enjoys excessive authoritarian power within the first district of Duque de Caxias (where the neighbourhood of Jardim Gramacho is located). His undemocratic and corrupt approach to politics has affected the work of the forum on several occasions.

On one occasion, the forum had successfully collaborated with the council to relocate 466 houses from their precarious self-built shacks in a favela (an informal settlement of self-built shacks and houses, otherwise known as slums) lacking sanitation and electricity, to an area close by with soon to be built council housing. Residents were asked to register for relocation at the municipal school, chosen by the mayor’s wife. The councilman who wields disproportionate power in this particular area turned up with his armed private bodyguards, and stood at the door of the registration room. No one was to enter without his permission. He subsequently turned fifty percent of households away claiming their shacks did no qualify for relocation. This allowed him to allegedly offer half the soon to be built council houses to his allies in return for votes.

In another example, the forum had generated popular support for building a community day care center by announcing the plan by loud speakers, distributing leaflets, and collecting signatures. The day care center was built with the support of the Secretaria de Acao Social (the state-level government department for social services), and the Secretaria de Educacao (the state-level education department). The same councilman claimed credit for the day care center however by erecting signs and spreading false rumors. It took a great deal of effort by the forum to counteract such false propaganda by mobilizing residents and spreading the truth about the true founders of the crèche. The truth is important because with false credit to the councilman he gains support and consequently votes, further increasing his power. Newspapers also reported a story whereby he allegedly physically assaulted the director of the State Education Department for supporting the forum in opening a direct channel for parents to find school places for their children. Prior to this initiative parents had to go through the councilman to apply for schools for their children.

Today the councilman continues to walk freely on bail and awaits trial, despite being arrested three times on charges of assault and association with drug traffickers. There is the possibility that he will be found guilty as charged, but the judiciary process is slow and might fail to reach justice when it does finally bring the case to bear, estimated to take place in at least two years time (2010).

Rita Brandão, IBASE’s community organizer, explains why people do not simply vote the councilman out of power: “Jardim Gramacho doesn’t have the political conscience to organise their voting patterns. People are primarily concerned with getting food to the table.”

Participants have made allies with many cooperative local government staff members whom they consider to be effective, but the problems are perceived to be with leadership and institutional level. I will now turn to explore the obstacles at the institutional level.

Inefficient Institutions No institution exists in Jardim Gramacho to manage the occupation of land and the building of shacks (favelas). It is in the interests of the drug traffickers to maintain this status quo as the larger the favela, the larger their potential customer base and the easier it is for them to hide from the police, who until now allegedly only enter to collect bribes. So even if the forum is successful at relocating the 466 households to newly built council housing, they will be replaced with a new wave of occupants. Without regulation and enforcement of the rule of law, there will be no end to the problem of growing slums in the neighborhood.

In another example of inefficient institutions, the forum had successfully convinced the local government to deliver two ambulances for twenty-four hour access to areas where the existing service does not operate at night for security reasons. The local government convinced a private hospital to deliver the ambulances to a council car park, but the ambulances somehow disappeared. It is not even known if they were delivered in the first place or stolen en route. This lack of accountability, security and efficiency stands in the way of confidence and progress, no matter how successful the forum is at influencing the decisions of public service providers.

Achievements, Challenges, and Future Prospects

The forum has successfully filled a governance vacuum with nearly thirty community organisations from diverse sectors engaged in a collaborative governance process based on authentic dialogue and collective action, through a strategy of empowerment planning. Jardim Gramacho has arguably evolved from a state of low community and low society, to a state of higher community yet persistently low society. This change represents a trajectory from near worst-case-scenario toward a suboptimal scenario, a move in a positive direction as illustrated in Figure 3.

Figure 3: Jardim Gramacho’s Shift from Near Worst-Case Scenario to Sub-Optimal Scenario

Source: Author’s interpretation of community/society interaction theory (Storper and Rodriguez-Pose, 2006) in context of this case study

This transition is a great achievement and in the process the forum has filled a governance vacuum by empowering a previously disconnected community sector. This coalition formation has ensured that diverse community voices are heard and in many cases has been acted upon by existing low levels of responsive public sector service providers. Tangible outcomes have begun evening out access to basic services such as housing, sanitation, education, and infrastructure, thus improving distributional tradeoffs.

The widening rift between society and community, however, poses upside and downside risks, with several possible future trajectories including rapid progression towards the optimum scenario, and rapid regression to the worst-case scenario.

In order to maintain a positive trajectory and an eventual rapid progression towards the optimum scenario, and to avoid some of the risks associated with high levels of community in the absence of society, three existing conditions need to be overcome:

Unresponsive and corrupt senior government officials (Higher ‘society’)
Inefficient institutions that develop regulation and uphold the rule of law (Higher society)
Lack of active citizenship amongst residents (Higher community)

The theory of network power in collaborative planning³⁷ developed by Judith Innes and David Booher offers a useful framework for developing a next-level transition strategy to overcome these obstacles and consequently accelerate towards a balanced state of high community/society interaction.

Network power is defined as “the shared ability of linked agents to alter their environment in ways advantageous to these agents individually and collectively”.³⁸ In contrast to other forms of power, network power is distributed throughout the network for all participants to share, and is a product of shared knowledge, experience, and power of participants in networked collaboration, resulting in collective intelligence.

Interdependence is a two-way relationship between two parties, whereby the self-interests of each party is dependent on the actions of the counterpart. (Note that when only one party’s self-interests are dependent on the actions of the other, this constitutes dependence but not interdependence.) One could argue that the threat of closing down the only street that leads to the landfill through the collectors social unrest generated interdependence between the government and the community of Jardim Gramacho, which arguably contributed to the success of the forum in negotiating with government service providers for extended service. The civil disobedience of 1995 also arguably generated interdependence between the community of Jardim Gramacho and the NGOs. The community realized it needed help to change the status quo, and the NGOs realized they had an opportunity to work with the community towards community development.

The authors conceptualize the triad as integral to the consensusbuilding process, which they argue is a fractal of collaborative governance. Network power emerges from this process as illustrated in Figure 4.

Figure 4: How Network Power Emerges from Collaborative Planning

Source: Author’s visual representation of Innes and Booher’s (2002) theory of network power in collaborative planning

The authors believe that although most difficult to achieve in the short-term, through network power “deep structure may change more quickly now than at other points in history.”³⁹

From this theoretical model one can deduce that the success of the forum is contingent upon achieving a critical mass of diversity (assuming the consensus-building model based on authentic dialogue is maintained). Players are incentivized to join the collaborative network if a sufficient level of interdependence is achieved and recognized. A strategy for strategically increasing diversity is thus contingent on identifying potential partners whose knowledge, experience, or power are likely to benefit the network as a whole, and to generate or raise awareness of interdependence to the tipping point whereby joining the network becomes in the self-interest of the target player(s).

The forum has identified a great source of power embedded in the collective action of residents. In the words of one participant: “I think the biggest obstacle we face is the lack of conscience amongst the majority of residents in the neighbourhood. If people mobilized against the current political system, we would change it.” Or as Rita Brandão argues, the reason residents do not simply vote the councilman out of office is because they do not have the political conscience to organize their voting patterns.

Engaging residents in the collaborative governance process would vastly increase the diversity of the network and consequently its network power. This in turn would impact the self-interests of potentially institutionalizing actors in government institutions, who would either become incentivized through political interdependence to join the collaborative process or be replaced by cooperative and responsive politicians through direct elections. This in turn would further diversify the network, potentially culminating in a critical mass of diverse participants for initiating a next-level transition to an optimum scenario of high community and high society. This creative and entrepreneurial process is arguably the next big challenge for the forum.

This strategy of engaging residents has already begun, but the process is slow. This strategy is being complemented by extending the network upwards by continuing to engage cooperative actors in existing government institutions, and by linking the network to other networks through national and international conferences. IBASE’s official handson engagement in this process ended in January 2008, but as Brandão explains: “We will continue to support the forum through networking and strategizing.”

Conclusion

Recent theoretical breakthroughs in the field of new institutional economics⁴⁰ highlight the synergistic nature of community/society interaction, its socioeconomic impact at various scales, and the expected pace of change in institutional arrangements through social forces. I hope to have contributed to this emerging literature by analyzing a positive transition in institutional arrangements in a neighborhood of 20,000 low income residents from a near worst-case scenario of low community and low society to higher community. Although not generalizable, findings from this case raise an interesting hypothesis of a community-led institutional change strategy for testing in various contexts.

The theory of change behind the forum’s success over the three year period since its launch in 1995 was based on a strategy of empowerment planning through a community-led collaborative governance process.⁴¹ The process is based on a self-organizing network of diverse and interdependent participants engaged in authentic dialogue, united by shared meaning, and aimed at collective action driven by the real and practical purpose of improving the quality of life in the neighborhood. Network power, a source of non-excludable and non-rival power and collective intelligence (essentially a public good generating positive externality for group members),⁴² emerges from this process for all participants to share.

Theory on community/society interaction highlights the risks and opportunities of the consequent imbalance between higher community and persistently low society. First, the resultant suboptimal scenario risks potentially negative externalities from higher community operating in isolation from equally developed societal institutions.⁴³ Furthermore, the speed of change in currently imbalanced institutional arrangements is potentially very high and unpredictable. If the forum loses momentum, the diverse community institutions risk regressing to their previous fragmented state of non-collaboration, taking the neighborhood back towards the worst-case scenario. Alternatively, a rapid shift towards the best-case scenario of high community and society is possible, albeit again not strategized at the neighbourhood level by the theory.

Drawing on the theory of network power, the collaborative governance process is strengthened by the diversity of participants and their interdependency. Continued success is thus contingent on further diversifying the network by generating interdependencies between diverse actors.

This next-level transition strategy would continue to build on the successful strategy of empowerment planning, complemented by a focus on extending the network toward the grassroots by engaging residents in the political process, and by extending the network upwards by targeting potentially institutionalizing actors in formal government institutions. The former would likely contribute to the latter as strategic voting power and civic engagement would align the interests of politicians (and the formal institutions they manage) with those of their constituents through higher interdependencies (politicians would need votes and legitimacy from conscientious and politically-engaged residents).

Furthermore, consistent with network theory,⁴⁴ connecting the forum with other national and international networks by participating in various conferences and events would expose the forum to innovation-inducing knowledge from weak ties with such distant and distinct networks. Both of these strategies have been in progress, which is promising for the future outlook of the forum.

Community/society interaction promises to align social, economic, and environmental priorities through formal and informal institutional interaction at multiple scales. Unsustainable development occurs when costs are externalized from the economic considerations of companies and regions, thus paid for by people (present and future generations) and/or the environment. By including all stakeholders in economic development processes, the voice of those bearing the burden of these externalized costs (or their representatives) are heard, increasing the chances of these costs being internalized in economic development decisions. Shaping socioeconomic development outcomes through the collaboration of diverse stakeholders thus promises to steer development in more sustainable trajectories, precisely because these stakeholders will struggle to internalize all costs of economic growth in decisionmaking criteria. This is arguably a process of radical democratization at multiple scales, the primary objective of IBASE.

Further research, particularly long-term case studies to allow complex processes to play out, are necessary in order to test the applicability of this transition strategy in other contexts, and to document other transition processes and strategies of institutional arrangements at various scales.

Naji P. Makarem is currently a doctoral student in the department of Urban Planning at the University of California, Los Angeles (UCLA). He earned his Masters in Local Economic Development at the London School of Economics (LSE) in 2007, and spent 8 months in Rio de Janeiro, Brazil, prior to his Ph.D. conducting research on IBASE’s work with the community of Jardim Gramacho. He comes from a business background, having worked in the private sector and done an MBA at IESE Business School in Barcelona, and launched an ethical T-shirt label prior to his Masters at LSE.

He would like to extend his sincere gratitude to Candido Grzybowski, the Director General of IBASE, for supporting his research; Itamar Silva, the coordinator of Democratizing the City Program, for his support; Rita Brandão from IBASE’s Democratising the City Program for her support, insights, several trips to Jardim Gramacho and her time and effort with our in-depth interview; and all forum participants for welcoming him to forum meetings and for their hospitality, with particular thanks to: Pascual, Sandra, Denise, Gloria, and Andrea for their time and effort with in-depth interviews.

Endnotes

1 See Michael Storper, “Society, Community and Economic Development,”
Studies in Comparative International Development (SCID), Springer,
New York, 39, no. 4, (December 2005); Andres Rodriguez-Pose and
Michael Storper,“Better Rules or Stronger Communities? On the Social
Foundation of Institutional Change and its Economic Effects,” Economic
Geography, 82, no.1 (2006): 1-25.; Thomas Faroles, Andres Rodriguez-Pose
& Michael Storper, “Social Capital, Rules and Institutions: A Cross-Country
Investigation”, Working Paper Series in Economics and Social Sciences, iMdea
Ciencias Sociales, (December 2007), Available online at http://repec.imdea.
org/pdf/imdea-wp2007-12.pdf.
2 The World Bank, World Tables: From the Data Files of the World Bank,
(Baltimore: John Hopkins University Press, 1992).
3Susan S. Fainstein, Competitiveness, Cohesion and Governance: A Review
of the Literature. (New Brunswick, NJ: Rutgers University, 2001).
4 Aron Janiene, “Growth and Institutions: A Review of the Literature,” World
Bank Research Observer 15, no. 1 (2000): 99-135.
5 Robert Putnam, Bowling Alone: The Collapse and Revival of American
Community. (Simon and Schuster, 2001).
6 Francis Fukuyama, “Social Capital and Civil Society” (paper presented at
the International Monetary Fund conference on Second Generation Reforms,
Washington, D.C., 1999).
7 Rodriguez-Pose and Storper, 3.
8 Ibid., 4.
9 See Storper and Rodriguez-Pose for a detailed analytical review of the
literature.
10 Rodriguez-Pose and Storper.
11 Rodriquez-Pose and Storper, 2.
12 Ibid., 1.
13 Ibid., 9.
14 Archon Fung and Eric Olin Wright, “Deepening Democracy: Innovations in
Empowered Participatory Governance,” Politics and Society 29, no. 1 (March
2001): 5-41.
15 See Susan Fainstein, Competitiveness, Cohesion and Governance: A
Review of the Literature. (New Brunswick, NJ: Rutgers University, 2001) for
a review of the literature of competitiveness and cohesion
16 Kevin Morgan, “The Learning Region: Institutions, Innovation and
Regional Renewal,” Regional Studies – Cambridge and New York, 31, no. 5
(1997): 491-504.
17 Fainstein , 2.
18 Rodriguez-Pose and Storper, 21.
19 See Rodriguez-Pose and Storper for details beyond the scope of this paper.
20 This research was conducted independently by the author who is solely
responsible for the contents of this study.
21 Judith E. Innes and David E. Booher, “Consensus Building and Complex
Adaptive Systems – A Framework for Evaluating Collaborative Planning,”
Journal of American Planning Association 65, no. 4 (Autumn 1999): 6.
Innes and Booher argue that a new lens is needed for understanding and
evaluating collaborative governance initiatives as they create new breeds
of self-organising institutions capable of learning from their environment,
adapting to change and evolving without centralized control. Unlike
traditional frameworks for evaluating top-down planning initiatives, with an
emphasis on outcomes vis-à-vis pre-determined goals, they recommend an
equal emphasis on process, arguing that a good process is more likely to lead
to good (pre-defined or unanticipated) outcomes. This process is likely to lead
to tangible and intangible outcomes which can emerge in the short, medium
or long-term. Some important outcomes can emerge outside the context of the
project, in the form of spin-offs or other collaborative partnerships.
22 Innes and Booher, 9.
23 IBASE, FURNAS Sociais Electricas, Comunidade COEP, (August 2005),
“Diagnóstico Social,” http://www.ibase.br/pubibase/media/diagnostico_
gramacho.pdf.
24 Valéria Bastose and Maria Stela de Araujo, “Possibilidades e Limites
do Trabalho de Organização Social dos Catadores de Lixo do Aterro
Metropolitano do Jardim Gramacho,” Construtora Queiroz Galvão S.A. –
Programa Social do Aterro Metropolitano do Jardim Gramacho. Duque de
Caxias, 1998 (Quoted from the diagnostico Social, see note 23)
25 Gloria. Interview by author. ACAMJG, January 2008.
26 IBASE, “About Us,” (accessed on 05/16/09), http://www.ibase.br/modules.
php?name=Conteudo&pid=379.
27 Barbara Loevinger Rahder, “Victims No Longer: Participatory Planning
with a Diversity of Women at Risk of Abuse,” Journal of Planning Education
and Research, 18 (1999): 221-222.
28 Ibid., 222.
29 Ibid., 229, cites: K.M. Reardon, “Community Development in Low-Income
Minority Neighborhoods: A Case for Empowerment Planning,”presented
at the 36th Annual Conference of the Association of Collegiate Schools of
Planning, (November 4, 1994, Phoenix, Arizona).
30 Collaborative governance can take many specific forms depending on
context and strategies employed. Examples include: policy consensus building,
community visioning, participatory budgeting, negotiated rulemaking,
networking among social service delivery agencies, collaborative resource
management, and the type under consideration in this case, empowerment
planning.
31 Barbara Gray, Collaborating: Finding Common Ground for Multiparty
Problems. (San Francisco: Jossey-Bass, 1989).
32 See endnote 23
33 Where all participants speak openly and in an informed way and are
listened to and taken seriously. E.J. Innes and D.E. Booher D. E., “Network
Power in Collaborative Planning,” Journal of Planning Education and
Research 21 (2002): 221-236.
34 Ibid.
35 The authors use complexity science as a powerful metaphor for
understanding why and how consensus building and collaborative processes
can work more effectively in today’s “complex, uncertain, fragmented policy
context”; and the concept of communicative rationality, based on dialogue
and joint learning by participants with common interests, as a framework
for understanding and evaluating consensus building. They propose that the
consensus building process may be a fraction of the larger phenomenon of
collaborative governance, a type of complex adaptive system.
36 Although interviewees suggested that the geographic fragmentation of
disproportionate power within the municipality’s jurisdiction spans across
the whole municipality of Duque de Caxias, my findings are limited to a
single corrupt councilman with disproportionate political power in Jardim
Gramacho, and cannot be generalized to the entire municipality.
37 Innes and Booher, 222.
38 Ibid., 225.
39 Ibid., 225.
40 Storper; Rodriguez-Pose and Storper.
41 Consensus-building is a fraction of colaborative governance, as defined by
Innes and Booher, Network Power in Collaborative Planning.
42 Mancur Olson, The Logic of Collective Action. (Cambridge, MA: Harvard
University Press, 1965). Olson defines a public good as non-rival and nonexcludable.
43 These have been widely documented in Rodriguez-Pose and Storper, with
reference to a broad New Institutional Economics literature.
44 Mark Granovetter, “The Impact of Social Structure on Economic
Outcomes,” Journal of Economic Perspectives 19, no. 1 (Winter 2005): 33-50.

Positive Institutional Change from the Ground Up: A Case Study of a Community-led Collaborative Governance Process

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