THE SOCIAL CONTRACT REPORT OF

AFRICA AND ASIA

A study case by UNDP

Abstract
UNDP is the United Nations’ global development network advocating for change and connecting countries to
knowledge, experience and resources to help people build a better life.

Aanchal
Ashutosh Deepak
Karthi Raju
Rinku Baloda
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TABLE OF CONTENTS

Introduction.......................................................................................................................1
What is Social contract?.....................................................................................................2
COMPONENTS AND DIMENSIONS OF THE SOCIAL CONTRACT.............................................4
Formal and informal institutions...................................................................................................4
The impact of external factors on the social contract...................................................................5

Economic elements of the social contract...........................................................................6

Why the social contract? Why now?..................................................................................8
Social contacts matters!!....................................................................................................9
UN Social contract in india............................................................................................................9

Conclusion.......................................................................................................................10
INTRODUCTION

This concept note presents an analysis of the use of a “social contract” as a way of framing UNDP’s governance
practices in fragile and conflict-affected contexts.

The report outlined the key components of an approach that would help improve the social contract in fragile
and conflict-affected contexts. These included the following:

a) Promoting responsive public institutions at both national and local levels;

b) Supporting inclusive politics, based on transparent and predictable mechanisms that include and engage
individuals or social groupings commonly marginalized or wholly excluded from political life;

c) Fostering resilient societies, chiefly by promoting robust state–society and society–society relations.

In order to achieve this, the report also proposed strengthening partnerships at multiple levels: at the
international level, with other UN agencies, other multilateral and bilateral agencies, and non- governmental
organizations (NGOs); and at the national level, with governmental institutions, civil society organizations, and
the private sector, as this work would require the coherent engagement of multiple actors.

The conceptual model (see Figure 1) thus placed

the social contract at the heart of an ideal UN-wide approach. These main elements, and others subsidiary to
them, required further specification and analysis in order to better build the case for the social contract
as a beacon to guide policy and concrete measures for positive change.

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WHAT IS SOCIAL CONTRACT?

One of the first thinkers to address the concept of the

social contract was Jean-Jacques Rousseau. He was
interested in the creation of a political community that
could balance collective with individual rights and could
resist prevarication and exclusion, dominant features of
the mercantilist era. A social contract, thus, was to be
regarded not only as a utilitarian transaction (i.e. as an
agreement to forfeit some rights in return for some other
benefits), but also, if not primarily, as a conscious effort
to achieve an egalitarian governance system, while still
respecting and guaranteeing the most fundamental
individual freedoms and rights.
The term “social contract” can be used descriptively,
referring to something substantively real; or heuristically,
as an aid to analysis. In the international development
community, however, it is often used normatively: an
ideal that states and societies should aspire to.
BOX 1: DEFINITION
The social contract refers to processes by which everyone
in a political community, either explicitly or tacitly,
consents to state authority, thereby limiting some of her or
his freedoms, in exchange for the state’s protection
of their universal human rights and security and for the
adequate provision of public goods and services. This
agreement calls for individuals to comply with the state’s
laws, rules, and practices in pursuit of broader common
goals, such as security or protection, and basic services.
The validity and legitimacy of a social contract may be
gauged by the extent to which it creates and maintains an
equilibrium between society’s expectations and obligations
and those of state authorities and institutions, all amidst a
context of constant flux.

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Social covenant refers to a “horizontal” process that brings together various ethnic, religious, clan, and
ideological groups within a political community (Kaplan, 2014). In covenants, the major groups within a society
come together and agree on a new framework and vision for cooperation. A social covenant may inform and
underpin a formal peace accord or even a nation’s constitution.

Social cohesion refers to the reduction of disparities, inequalities, and social exclusion within or between
societal groups, as well as the strengthening of social relations, interactions, and trust. Such disparities often
coincide with political divisions and forms of organised violence, sometimes driven by long–standing
grievances and collective humiliation. Social cohesion and the social contract can be mutually reinforcing, for
better or worse. Damaged social cohesion can possibly be repaired by

the very process of negotiating a social contract. Social cohesion affects the quality and durability of the social
contract; a nascent or transitional state can make greater social cohesion a goal that orients its contribution to the
social contract. Understanding and respecting factors that promote or undermine social cohesion are thus vital in
advancing robust social contracts.

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COMPONENTS AND DIMENSIONS OF THE SOCIAL CONTRACT

The significance of social contracts typically depends on the capacities and legitimacy of public institutions and
the interplay of economic and political forces, including interests beyond territorial levels. This sub- section
reviews some of these key dimensions and components.

FORMAL AND INFORMAL INSTITUTIONS

States and politics typically involve both formal and informal rules and practices. Especially, though not
exclusively, in non-Western states, “informal networks and personal relations still influence how power is
distributed and used” (OECD, 2010a: 17). The legitimacy of local authorities and rules may pose challenges to a
social contract, where the “local turn” may set limits to principles of universalism. In peacebuilding,
international agencies have shown ambivalence toward customary structures, sometimes seeing them as
socially regressive and sometimes as valid helpmeets for peace, such as in parts of the Democratic Republic of
Congo and Myanmar (Mac Ginty and Richmond, 2013; Hellmüller and Santschi, 2014).

In practice many non-Western states are “hybrid” political orders. These are constitutional liberal democracies
that nominally operate according to formal, legally enforceable rules. But they coexist with other, competing
socio-political rules with indigenous roots that rely on webs of social relations to establish trust and reciprocity
(OECD, 2010b: 17–19). Given high levels of “informalization” in fragile and transitional contexts, social
cohesion can be at risk where locally legitimate institutions are set aside – or made instruments of control – by
formal authorities. On the other hand, the “invisibility” of informal systems of authority has historically helped
foster social exclusion and weak institutionalization of the state, as in some zones of Guatemala, Bolivia, and
Ecuador. That invisibility hinders the access of minorities and others to basic services and justice.

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In addition, the assumption that social contracts take place between a state (i.e. government institutions and
possibly political elites) and the individuals living within the official boundaries of that state (and who are
recognised as legitimate counterparts) does not automatically lead to an understanding
of the dynamics and power structures present in that society. Some observers (e.g., Leonard, 2013) hold that
“contracts” may exist at both local and transnational (diaspora) levels, among families, clans, and informal
associations. These exist alongside links with the state and formal politics. Together these can mediate
relationships between individuals and the state. They are not necessarily conducive to robust social contracts;
indeed they may enforce unequal power relations and exclusion. The cases of denied citizenship of the Muslim
Rohingya community in Myanmar, and of the influential role that diasporas can play in domestic politics, serve
as reminders of extra-territorial complexities of fragile situations and the related power dynamics central to
the emergence (or lack thereof) of a social contract.

THE IMPACT OF EXTERNAL FACTORS ON THE SOCIAL CONTRACT

It is also important to emphasize that, despite its strong domestic connotations, a social contract can hardly be
regarded as a dynamic agreement that takes place completely unconnected with the supranational level.
International covenants, security pacts, trade regimes, financial agreements, governance institutions, social
movements and forces, all add concrete boundaries and pressures to the eventual shape and reach of a
national social contract. Although national actors may have the feeling that they are involved in their own
negotiations, existing supranational structures and forces may greatly reduce the space for maneuver and may
influence the result of those negotiations. Once fiscal, monetary, and trade policies have been locked in to
binding agreements, or the control has simply been transferred to international centres of power, then public
contestation is doomed to become irrelevant, unless it takes massive and often violent forms.

 The fiscal weakening of governments subjected to strict requirements by the international community
to liberalize capital controls and trade taxes (with resulting revenue losses), and also to strong
transnational tax competition, which tends to favour “light” domestic tax regimes and, in the worst
cases, non-transparent accounting and illicit capital flight;

 The insertion of national economies into global trading and financial circuits, exposing national
producers, consumers and public treasuries to fluctuations in income, prices, and revenues that often
trigger violence.

 Exposure to transnational criminal circuits and other armed actors. Decades of lucrative and
competitive rent-seeking created by drug prohibition regimes have seen the rise of networked and
diversified criminal industries that have often penetrated political classes and legitimate businesses
and have supported violent political movements.

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ECONOMIC ELEMENTS OF THE SOCIAL CONTRACT

The interactions between the supranational and the national level mentioned above also highlight the
importance of economic dimensions in the formation of a social contract. While often stemming from bona
fide commerce and industry, economic interests can have large shadow sides: criminal control of illicit
activities, corruption of state institutions, support for an economy of war, capital flight, and other interactions
with the international financial sector. Services and laws that in principle should be accessible for all, and
underpin a social contract, can sometimes be controlled and “protected” by actors such as criminal gangs, as in
Karachi and in Central America, which oversee illegal land distribution and access to basic urban services.

Access to social protection and basic public health and education services, housing, land, credit, and jobs are
fundamental to a social pact. Together these may be termed an “economic social pact,” something that
naturally implies private sector responsibilities. Economic inclusion is the hallmark of an economic social pact,
insofar as the terms of inclusion are fair rather than adverse.

Inclusive and equitable economic outcomes are thus fundamental elements of the social contract. To achieve
these outcomes, taxation and expenditure policies are often among the most effective short- to mid-term
instruments available to public authorities. Fiscal policies can affect prospects for peace by redistributing
income and wealth. Bargaining about them can instil content to political life, lending it legitimacy.
Improvements to public services for non-elite groups can be an important part of sustaining a strong social
contract. People can benefit from public expenditure through the allocation of contracts and employment, as
well as through their access to public services, and fair revenue-sharing formulas can increase the sense of
regional equity in the collection and redistribution of national resources – an issue that often takes centre
stage in separatist struggles

Policies that can help build up the economic basis of a social contract include the following:

 Pro-employment and livelihood policies that focus on, among other things, the informal
sector and its main actors in the processes and institutions that create policy;
 Social and labour policies guaranteeing a country- defined set of basic social rights, services
and facilities available to everyone and consisting
of, among other things, cash transfers, universal access to health care services, food-based
programs, school supplies, and vocational and training programs for the unemployed. A
growing body of evidence demonstrates that basic components of social protection, such as
disability and old age cash transfers as well as support of families with many dependents, can
be afforded even in poor states in sub-Saharan Africa (Cook and Kabeer, 2009);

 Policies pushing back against the sweeping commodification of fundamental services such as
water, sanitation, health, education, and housing. Since this commonly takes place in the
context of weakened public regulation, such a commodification brings with it risks of

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 “market failure,” exemplified by cartels, price-fixing, deception, and fraud, not to mention
increasing social and political inequalities;
 Food security policies, which can be crucial from a social contract perspective, as most of the
marginal income of the poor is spent on food.

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WHY THE SOCIAL CONTRACT? WHY NOW?

The UNDP’s Governance for Peace: Securing the Social Contract has put the social contract into the
foreground. As a process by which “rules of the game” are negotiated and renegotiated, the social contract is a
deeply political matter posing both opportunities and risks. In light of the harm than can arise from poorly
formed or inoperative social contracts, refusing to acknowledge and engage with political realities is not a
viable option. Disorder and violence are being reproduced continually for want of political engagement
between state and society. Synthesizing recent scholarship and conflict monitoring, the World Development
Report 2011 concluded that “Many countries and subnational areas now face cycles of repeated violence,
weak governance and instability” (World Bank, 2011: 2). Such cycles can be found in many settings, including
those whose fragility was supposed to have been reduced through outside intervention and “peace
processes.” Cases where those measures did not “stick” – Afghanistan, the Democratic Republic of Congo,
Libya, South Sudan – are troubling.

Lack of coherence in concepts, and their mismatch with socio-political realities, have rendered the current
“fragile state” model too feeble to support a robust and effective framework for policy. Indeed, that model has
been highly contentious, not least among countries designated as “fragile.” Many saw it as a label of
disapproval applied to those failing to follow prescriptions imposed from international actors, such as pro-poor
policies, the Millennium Development Goals, and human rights. The failure of imposed economic formulas and
of state-building along Western (Weberian) lines in settings as diverse as the Balkans and West Africa indicate
the limitations of conventional paradigms. The pursuit of alternatives has become imperative.

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SOCIAL CONTACTS MATTERS!!

 Peace and stability, since consent to be ruled means refraining from political violence toward the
ruling order;
 Resilience, as it allows for change through renegotiation of its terms;
 Legitimacy of states, since agreed mutual roles and responsibilities are seen as valid and appropriate;
 Accountability of states to citizens, insofar as upholding terms of the contract will help keep public
expectations in (rising) equilibrium with leadership performance.

Shorter-term issues of war, peacekeeping, and project operations have been studied in depth. The same kind of
depth and rigor should be applied to studying how longer-term matters such as justice, security, and jobs–
matters of crucial importance to people – become anchored in political life.

UN SOCIAL CONTRACT IN INDIA

TRIPURA

Decades of armed insurgency assailing this small state in the east of India abated in the early 2000s thanks to a
new political dispensation and scaled-up programmes for food security, job creation, and public service
provision. Local level “micro-democratic” bodies such as autonomous development councils, gram
panchayats,4 and village councils were strengthened. Results of public anti-poverty and anti-corruption efforts
surpass those of other Indian states, including its neighbours, which continue to suffer sporadic organized
violence.

Although there is limited systematic empirical evidence of the role of the social contract, the concept reflects
an important move towards a more holistic and systemic view of governance and development. It promotes a
focus on a broader range of relationships and processes than earlier approaches, which tended to emphasize
the activities and roles of elites. The merits of the concept of the social contract for development practitioners,
therefore, lie in its focus on the role and agency of “ordinary people,” in their engagement with government,
and in their governments’ accountability to them. It is this “interface” of state and society that the social
contract usefully highlights for us. The concept of the social contract holds promise to help us focus our
thinking on how best to engage the interface between the state and society. Further rigorous analytical study
should be undertaken to make sure that we can capitalize on this promise, rather than having the social
contract become a conceptual “bucket” that is applied loosely and without deeper understanding. The danger
that must be avoided is that a glib adoption of the social contract may cause us to bundle together concepts
that should be distinct. By being careful to keep these concepts separate we will be better able to assess how
to support processes and structures in a way that contribute to development and peacebuilding outcomes.

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CONCLUSION

Outcome that came from the social contract is as following:

 Growth and development are inclusive and sustainable, incorporating productive capacities that
create employment and livelihoods for the poor and excluded;

 Citizen expectations for voice, development, the rule of law, and accountability are met by stronger
systems of democratic governance;

 Strengthened institutions to progressively deliver universal access to basic services;

 Reducing gender inequality and promoting women’s empowerment.

Each of these outcomes is fundamentally connected to the relationship between state and society. In a sense
this is good news, because the building blocks are already in place for a comprehensive plan to work on
building the social contract in fragile and conflict- affected areas.

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