Politicians, Parties, and the Persistence of Weak States:
Lessons from the Philippines
Gabriella R. Montinola
ABSTRACT
Under what conditions will politicians strengthen state capabilities through
bureaucratic reform? This article presents a principal±agent model of state
capacity that shows that unless competition to in¯uence policy is largely
con®ned to a single dimension, politicians have no incentive or `political will'
to adopt bureaucratic reform. The validity of this model is tested using the
experience of the Philippines in the period 1946±72. It is found that politically
relevant groups in the Philippines were competing to in¯uence policy over
issues of social welfare, economic nationalism and control over public
spending, and that groups' demands over these issues failed to align along a
single dominant dimension. Consistent with expectations derived from the
principal±agent model, there were numerous calls for and attempts to improve
bureaucratic performance, but the calls went unheeded and the attempts failed
miserably. The study highlights a lesson of potential use to countries currently
undergoing democratization. It argues that state capacity is not a function of
insulating the state from societal forces, but rather of clarifying lines of
authority and accountability in the hierarchy of principal±agent relationships
between society, politicians and bureaucrats.
1. INTRODUCTION
Many Ð probably most Ð development theorists agree that a country
needs a competent bureaucracy, often referred to as a strong state, in order to
promote economic development. But how does one create and maintain a
competent bureaucracy? And why do weak ones persist?
Some scholars argue that bureaucratic capabilities are determined by the
distribution of social control between the state and other societal organizations (Kohli et al., 1994; Migdal, 1988). According to this `state-in-society'
view, macro-historical forces, such as the spread of capitalism and colonialism from Western Europe, determined the distribution of social control
within less developed countries at independence. This colonial legacy in turn
determined whether states would have the capacity to `penetrate society,
regulate social relationships, extract resources, and appropriate or use
resources in determined ways' (Migdal, 1988: 4).
Development and Change Vol. 30 (1999), 739±774. # Institute of Social Studies 1999. Published
by Blackwell Publishers Ltd, 108 Cowley Rd, Oxford OX4 1JF, UK.
740
Gabriella R. Montinola
An alternative explanation for state strength focuses on micro-level
factors, especially the preferences of state leaders (Geddes, 1994). According
to this view, oce-seeking politicians ®nd themselves playing two overlapping prisoners' dilemma games Ð one with their potential supporters in
the electorate, and the other, a game with fellow politicians in the legislature.
Legislators, it is argued, will vote for bureaucratic reform and build state
capacity when the bene®ts to individual politicians from having an ecient
bureaucracy outweigh the bene®ts from having the ability to dispense
patronage and particularistic goods.
In this article, I argue that focusing on the microfoundations of the
decision to reform the bureaucracy is critical when explaining state capacity.
I contend, however, that using the prisoners' dilemma to capture the
interaction between politicians and their supporters is problematic because it
assumes that holding politicians accountable to their campaign promises is a
relatively simple task. Thus, I provide a di€erent analogy for the structure of
incentives and opportunities facing politicians and their potential supporters.
In particular, I present a principal±agent model based on works by John
Ferejohn, Kenneth Shepsle and Barry Weingast which shows that politicians
are unlikely to adopt bureaucratic reform if the electorate's demands over
various issues, including reform, fail to align largely along a single continuum (Ferejohn, 1986; Shepsle and Weingast, 1981a).
The following section discusses the state-in-society and micro-level
approaches to state capacity in more detail. Section 3 then presents a third
alternative: a principal±agent model of state capacity. This is followed in
Section 4 by an examination of the principal±agent model through the
experience of the Philippines, ®rst explaining the rationale for selecting the
Philippine case, then looking at the numerous attempts to reform the
Philippine bureaucracy in the ®rst twenty-®ve years after independence in
1946, and ®nally analysing the structure of competition to in¯uence policy in
the Philippines. The article concludes with a discussion in Section 5 of the
implications of this study for the literature on state capacity and economic
development more generally.
2. ALTERNATIVE THEORIES OF STATE CAPACITY
One of the most ambitious explanations for the variation in state capacity
across developing countries is that of Joel Migdal, who considers why some
post-colonial states have accomplished major goal-oriented social change
while others have not (Migdal, 1988). Based on a broad knowledge of
developing countries and a closer examination of Sierra Leone, Israel and
Egypt, Migdal contends that the nature of a country's colonial experience
and the timing of its integration into the world capitalist system determines
the strength of its state. According to Migdal, in a number of former
colonies, colonial rulers strengthened non-state organizations, such as
Politicians, Parties, and the Persistence of Weak States
741
regional tribes and local patron±client networks, and at independence these
non-state organizations resisted state leaders' attempts to extend control over
society. This resistance compelled state leaders to adopt strategies that
paradoxically crippled their own abilities to generate social change. To avoid
threats to their positions of power from within, rulers kept potential
challengers weak through the arbitrary use of their appointment powers.
They transferred top bureaucrats often to prevent the development of strong
loyalties within particular agencies. They used non-merit criteria for
appointments at every level. To avoid threats from power centres outside
the state, leaders accommodated the interests of capitalists and regional
strongmen. Rulers allowed these non-state actors to engage in direct
exchanges with local politicians and bureaucrats, and in the process, undermined their own abilities to e€ect social transformation. In sum, according to
Migdal, state leaders who inherited strong non-state organizations and
fragmented social control at independence engaged in `politics of survival'.
Consequently, they failed to forge strong states and generate state-led social
change in the immediate post-colonial period.
Once states are caught in the vicious cycle of accommodation between state
leaders, capitalists and regional strongmen, are there conditions that might
lead to change or ¯uctuation in states' capabilities? According to Migdal,
strong states will develop if two conditions are met: (1) if non-state networks
of social control are severely disrupted; and (2) if rulers and bureaucrats
emerge who identify their interests with an autonomous state. Many
developing countries have experienced the ®rst condition Ð seriously
disruptive events such as civil war, strong insurgency movements, mass
migration, and famine. The absence of strong states in these countries implies
that they failed to meet the second condition. Thus, the question becomes:
under what conditions will rulers and bureaucrats have an interest in
cultivating state autonomy? At ®rst glance, state leaders and bureaucrats
appear always to prefer more state autonomy than less. Yet the apparent
variation in state capacity across di€erent countries indicates the need to
examine individual ocials' preferences and interests more closely.
An alternative theory of state capacity provided by Barbara Geddes
confronts the issue of rulers' interests more explicitly (Geddes, 1994). Geddes
views the state as a collection of self-interested politicians and bureaucrats
attempting to maximize career success, and provides conditions under which
politicians will identify their individual interests with an e€ective state. She
argues that politicians in developing countries often ®nd themselves playing
two overlapping games that have signi®cant consequences for bureaucratic
competence. The ®rst is a prisoners' dilemma (PD) game between politicians
and supporters (in other words, a game between patrons and clients). The
second is a PD game among politicians in the legislature who must decide
whether or not to vote for bureaucratic reform.
In Geddes's framework, politicians promise clients particularistic bene®ts,
including government jobs, and clients promise to support politicians during
742
Gabriella R. Montinola
elections. Both groups maintain their pledges despite incentives to renege
because they expect to bene®t from co-operation over the course of many
years and elections. According to Geddes, the bene®ts which politicians
receive from their interaction with clients in large part hinder bureaucratic
reform in developing countries. If politicians choose to maintain a
patronage-based system of bureaucratic appointment, they increase their
probability of re-election in the short-run but cripple the state's ability to
implement policy. Alternatively, if politicians choose to vote for bureaucratic
reform, they risk losing elections in the short-run but create a competent
bureaucracy able to promote development. Politicians' choices depend on the
structure of payo€s that they face. In particular, Geddes argues that when
parties (or relatively stable coalitions of parties) have equal access to
patronage, payo€s are such that it would be in politicians' interests to pass
bureaucratic reform. She assumes that parties (or coalitions) have equal
access to patronage if they have relatively equal numbers of seats in the
legislature and have been alternating in control of the presidency. In sum,
Geddes argues that understanding why some states are strong and others
weak entails considering the conditions under which it would be in the
interest of politicians to pass bureaucratic reforms.
Geddes's emphasis on more immediate political variables, such as politicians' calculations, is a welcome re®nement to macro-historical explanations
of state capacity. Her work is also notable for the clear hypotheses that can
be derived from it and her attempt to test the theory using ®ve Latin
American countries (Brazil, Chile, Colombia, Uruguay and Venezuela).
Although Geddes's theory is con®rmed by the cases she adduces, I contend
that the use of the prisoners' dilemma as an analogy for the interaction
between politicians and their clients is theoretically problematic. The
prisoners' dilemma assumes symmetric power between actors, and this is
rarely the case with patrons and clients. I argue that while the prisoners'
dilemma may be the appropriate analogy for the strategic environment which
politicians face in their competition with each other over the problem of
bureaucratic reform, we need a di€erent analogy to capture the asymmetric
power and interaction between politicians and clients. Such a model is
presented below, which also provides a response to the question of why
politicians are more likely to renege on their campaign promises to reform
the bureaucracy in some countries than in others.
3. A PRINCIPAL±AGENT THEORY OF STATE CAPACITY
I introduce this model of state capacity with an abstract conception of
democracy as a hierarchy of principal±agent relationships between bureaucrats, politicians, and clients/supporters (Rose-Ackerman, 1978; Tirole,
1986). In a simple agency relationship, a principal expresses a set of
preferences over outcomes, and the agent accepts an obligation to act on
Politicians, Parties, and the Persistence of Weak States
743
Figure 1. Democracy as a Hierachy of Principal±Agent Relationships
behalf of the principal in exchange for some form of compensation. The
principal's problem is one of ensuring that the agent, who has interests of his
own, acts on the principal's behalf. In particular, I consider clients/
supporters as principals with politicians as their agents, and politicians as
principals with bureaucrats as their agents (see Figure 1). This view of
democracy implies that although bureaucrats are insulated from direct
penetration of societal forces, they are not autonomous from them. Bureaucrats are accountable to societal forces, albeit indirectly through politicians.1
This conception of democracy also deliberately turns the typical characterization of patron±client relationships on its head in order to gain analytical
leverage. This research tool directs our attention to the following questions:
under what conditions will political supporters, including so-called clients,
have the incentive and ability to induce politicians to build competent states?
What conditions prevent supporters from punishing politicians who fail to
do so?
In considering these questions, I assume that a signi®cant number of
individuals in every democracy has an interest in reform. Undoubtedly, in
any country, there exist a few individuals who bene®t unequivocally from a
state susceptible to their intervention, and they will oppose reform. If,
however, ineciency and corruption undermine the provision of government
services, economic development, and political stability, then the majority of a
country's population is likely to be better-o€ in the long run from an increase
1. This view of democracy also assumes that there is no single `public interest'. It assumes
con¯ict of interest in every society.
744
Gabriella R. Montinola
in bureaucratic competence. Not surprisingly, a perusal of local newspapers,
campaign speeches, and various single-country and cross-national surveys
shows that bureaucratic ineciency and corruption are major public
concerns where they are prevalent.
Many works address the diculties politicians face in their attempts to
control bureaucrats and improve bureaucratic performance (Ban®eld, 1975;
Klitgaard, 1988). They suggest that the keys to controlling bureaucrats are
appropriate rewards and punishments, and monitoring devices such as
citizens' committees. The weakness of this argument, however, lies in its
failure to consider that what appears to be bureaucratic behaviour beyond
the control of politicians may, in fact, be behaviour encouraged or at least
permitted by politicians in their attempts to maintain power. Thus, I focus on
the agency relationship between politicians and their supporters and on
specifying the conditions under which it will be in the interest of politicians to
pass reforms strengthening the bureaucracy.
The agency relationship between politicians and clients is somewhat
similar to that between bureaucrats and politicians. Politicians accept the
obligation to provide bene®ts to their clients, or principals, in exchange for
political support and some legal compensation. Clients are faced with the
task of ensuring that politicians ful®l their obligations. This task is complicated because clients can be induced to compete against each other for
bene®ts over which politicians have control (Ferejohn, 1986). Figure 2, a
standard winset model of spatial choice, illustrates how potential supporters
can be compelled to compete against each other (Shepsle and Weingast,
1981b). In the process, clients impede their own ability to ensure that
politicians ful®l their campaign promises, including the promise to insulate
the bureaucracy from particularistic pressures.
Figure 2 represents a democratic system with an incumbent and three
potential supporters competing to in¯uence policy over two dimensions. A
dimension is the structure of electoral preferences expressed through voting
behaviour. A structure of demands over bundles of socio-economic policies
constitutes one type of dimension, often referred to as the left±right
ideological dimension. Demands for bene®ts, such as public works and
patronage positions, can also constitute distinct particularistic dimensions of
competition (Shepsle and Weingast, 1981a). Constituents in each district can
demand more bene®ts for their district and less for every other district in
order to maximize their allocation while minimizing their taxes. Unless
districts form stable coalitions in their competition over the allocation of
public works, their demands are likely to be multidimensional. I assume that
all societies are composed of individuals with heterogeneous demands. The
critical factor for this study is whether aggregate demands over various
issues, including highly particularistic ones, are con®ned mainly to a single
dimension.
Competition to in¯uence policy is unidimensional when citizens' demands
are articulated such that each voter's preference over any issue appears
Politicians, Parties, and the Persistence of Weak States
745
Figure 2. A Standard Winset Model
correlated with his/her preferences over all other issues. Competition is
unidimensional, for example, if individuals' preferences on economic issues
can be used as predictors for their voting behaviour on all other policy issues.
Competition to in¯uence policy occurs along a single dominant dimension
when voters' preferences over one issue can be used as predictors for their
voting behaviour on a majority of issues. Competition is multidimensional
when voters' preferences over di€erent issues are uncorrelated with each
other such that knowledge of an individual's preferences over any issue
provides little insight into his/her voting behaviour on other issues.
It is dicult to imagine actual cases of perfectly unidimensional competition. Real world cases are likely to ®t under the categories of single
dominant or multidimensional competition. For example, a number of
works suggest that competition to in¯uence policy in Western European
countries and the United States tends to occur along a dominant dimension,
characterized as some variant of the left±right dimension, while the number
and nature of less salient dimensions vary across cases (Budge et al., 1987;
Laver and Hunt, 1992; Poole and Rosenthal, 1991). Alternatively, in
previous work on Chile, I found that the structure of competition to in¯uence
policy changed over time (Montinola, 1997). From 1891 to 1921 Chilean
deputies were competing in a multidimensional arena, which encompassed
confessional, trade, monetary and social welfare issues. Knowledge of
deputies' votes on any one of the four issues provided little insight into their
746
Gabriella R. Montinola
preferences over other issues. By the late 1930s, however, political parties had
become extremely cohesive, and competition to in¯uence policy began to
align along a party-de®ned left±right dimension.
In Figure 2, the ideal policy choices of three voters are denoted by the
points 1, 2 and 3, and the structure of their preferences is depicted as twodimensional. If we assume, for example, that the horizontal and vertical axes
in Figure 2 represent spending on two di€erent issues, such as welfare and
military spending, knowing that a voter preferred relatively high spending on
issue A would give us insucient information to predict whether he would
prefer more or less spending on issue B. A voter who preferred relatively high
spending on issue A might prefer less spending on issue B, as depicted by the
ideal point of voter 3, or he might prefer more spending on issue B, as
depicted by the ideal point of voter 2. Likewise, knowing that a voter
preferred relatively high spending on issue B would give us little information
on his preference with respect to issue A. Stated di€erently, if we assume that
points 1, 2 and 3 represent the ideal policy preferences of groups of voters, at
the aggregate level, voters' preferences over the two issues will not be highly
correlated with each other.
If the points 1, 2 and 3 depict voters' ideal policy mixes, the indi€erence
curves around each point denote each voter's preferences over alternatives.
Potential supporters are assumed to prefer policies closer to their ideal
points. They prefer all positions inside the curves to alternatives on the curve.
Supporter 3, for example, would prefer policies associated with points inside
his/her indi€erence curve to the point x1, but would be indi€erent to policies
associated with the points x1 and x2. The shaded areas depict a winset, the set
of policy positions that decisive majorities Ð in this case, at least two out of
three supporters Ð would prefer over the point x1.
To maintain power, the incumbent must obtain a decisive majority's
support. This can be done by adopting policies associated with any point
within the winset, e.g. x1 Ð a point representing policies acceptable to all
three voters. But the two-dimensional nature of competition to in¯uence
policy implies that this position cannot be sustained (McKelvey, 1976; Plott,
1967). An incumbent who adopts policies associated with x1 can invariably
be defeated by challengers because every other point within the winset will be
preferred by a decisive majority of at least two voters. Moreover, x1 is not the
only unsustainable position in this model. Every point acceptable to two
voters can be defeated by other points within the winset.
Consider, for example, policies associated with x2. Such policies would be
preferable to voters 1 and 3 over policies associated with x1. However,
policies associated with x3 would be even more attractive to voter 3, and a
coalition of voters 2 and 3 would be willing to support a politician who
adopted policies associated with x3. Alternatively, policies associated with x4
would be more attractive to voter 2 than x3; and a coalition of voters 1 and 2
would be willing to support a politician who adopted policies associated with
x4. Finally, policies associated with x2 would be more attractive to voter 1
Politicians, Parties, and the Persistence of Weak States
747
Figure 3. The Winset Model with Incumbent Corruption
than x4, and a coalition of voters 1 and 3 would be willing to support a
politician who adopted policies associated with x2.
This two-dimensional nature of competition to in¯uence policy would
send ambiguous messages to incumbents interested in re-election. When
voters are unconstrained in their ability to form electoral coalitions Ð as
they are when competition to in¯uence policy is multidimensional Ð then
incumbents are highly susceptible to defeat. This vulnerability minimizes
incumbents' incentives to ful®l their campaign promises. Paradoxically, it
also provides them with the opportunity to maintain power even when they
renege on their campaign promises. If incumbents can appeal to di€erent
majorities every election, then voters will have diculty punishing them.
The logic of this argument and its relation to building state capacity is
illustrated in Figure 3. In this ®gure, a third dimension is added to the
standard winset model depicted in Figure 2. The new (vertical) dimension
represents the amount of bene®ts an incumbent can secure for himself, and
conversely, the degree of bureaucratic insulation from politicians. Bene®ts, in
this case, refer to government resources that incumbents can use for their
personal enrichment or to further their political careers. The vertical
dimension is scaled from (0) for minimum bene®ts to incumbents and
maximum insulation of bureaucrats to (1) for maximum bene®ts to incumbents and minimum insulation of bureaucrats. The two horizontal dimensions in Figure 3 parallel those of Figure 2.
748
Gabriella R. Montinola
Figure 3 shows that if competition to in¯uence policy occurs along more
than a single dimension, incumbents will be uncontrollable and can exert
pressure on bureaucrats for particularistic bene®ts. Consider, for example,
the following scenario. An incumbent adopts policies acceptable to all three
voters and extracts bene®ts from bureaucratic agencies for his personal
enrichment. Graphically, the point SQ denotes the policies adopted by the
incumbent. The amount of bene®ts that the incumbent extracts for himself
can be conceived of as a move up the vertical dimension toward 1. Voters can
threaten not to support the incumbent in the next election unless he refrains
from intervening in bureaucratic a€airs for his personal enrichment, but their
threats will be dicult to carry through because the incumbent will have the
opportunity to start a `bidding game' between voters. He can o€er any two
out of three voters policies that they would prefer to SQ, in this case, any set
of policies associated with the winset, or shaded areas. Unless each voter can
be certain that the others will not support the incumbent, each voter will have
an interest in ignoring the incumbent's intervention in bureaucratic agencies.
Not wanting to be left out of the winning coalition altogether, voters are
more likely to accept incumbents' use of the bureaucracy for personal
enrichment, and incumbents will have the opportunity to maintain power
while enriching themselves.
Will the presence of challengers not compel incumbents to insulate the
bureaucracy? The analysis suggests that challengers provide insucient
motivation for bureaucratic reform. Although a challenger can always
promise to insulate the bureaucracy, given the structure of incentives facing
incumbents in a multidimensional arena, potential supporters will expect
challengers to renege on their promises as well. Thus, constituents will have
less incentive to replace the incumbent, and incumbents will have less
incentive to adopt bureaucratic reform. Alternatively, challengers will
recognize ex ante that they will not be able to maintain stable coalitions of
supporters because any set of policies they adopt can be defeated by others
bene®cial to di€erent decisive majorities. Consequently, since bureaucratic
insulation would limit their access to resources for future campaigns,
challengers will have the incentive to renege on their promises to adopt
bureaucratic reform. In sum, unless competition to in¯uence policy is con®ned largely to a single dimension and politicians are constrained in their
ability to obtain support, campaign promises will not be self-enforcing.
Politicians will always have an interest in reneging once in power.
Below, I examine this theory of state capacity through the experience of the
Philippines. The section starts with a note on selection of the Philippine case.
This is followed by a description of the way politicians and societal forces
have weakened the Philippine state through time and the various attempts to
reform the bureaucracy. Finally, data for the structure of electoral preferences is examined with a view to determining whether oce-seekers faced an
electorate whose preferences over di€erent policies were structured mainly
along a single dimension.
Politicians, Parties, and the Persistence of Weak States
749
4. THE PHILIPPINE CASE
Note on Case Selection
The Philippines was chosen for two reasons. First, it has the characteristics of
a crucial case (Eckstein, 1975). The case appears among the most likely to
con®rm Geddes's theory of state capacity, but a key hypothesis derived from
her theory is not validated by the experience of the Philippines. As mentioned
earlier, Geddes argues that when parties have relatively equal strength in the
legislature, politicians will be more likely to adopt bureaucratic reform. The
Philippines had two major political parties Ð the Liberals and the
Nacionalistas Ð from independence in 1946 to 1972, when the then
President Ferdinand Marcos declared martial law. The two parties consistently won roughly equivalent numbers of legislative seats and alternated
in their control over the presidency. Each party had a majority in the house in
three out of six congressional sessions from 1946 to 1969; the Nacionalistas
were in the majority when Marcos declared martial law three years into his
second term in 1972.2 Each party produced three presidents, and Marcos was
the only incumbent president ever re-elected. Thus, according to Geddes's
theory of state capacity, we would expect politicians in the Philippines to
have passed legislation insulating the bureaucracy. In fact, bureaucratic
reform was always one of many issues on both parties' platforms, yet reform
was minimal at best (de Guzman, 1968).
The second reason for selection of the Philippine case is its utility in
extending the state-in-society approach. Although it can be argued, based on
Migdal's framework, that the Philippine state was unable to e€ect social
transformation in its ®rst twenty-®ve years after independence (1946±72)
because of resistance from clientelist organizations with strong networks of
social control (see also Nowak, 1977), one is still left wondering why a
competent state failed to emerge given the apparently widespread interest in
reform. Minimizing bureaucratic ineciency and corruption was a salient
issue in every election: why then was the electorate unable to compel
politicians to adopt reforms strengthening the bureaucracy?
A number of students of Philippine politics suggest further responses to
this question, some of which are consistent with Migdal's framework. Some
scholars suggest, for example, that the introduction of elections before the
institutionalization of meritocratic civil service appointment procedures led
to the creation of a weak state in the Philippines (Lande, 1965; Scott, 1972).
Others argue that due to extremely low salaries and the severe post-war
in¯ation, bureaucrats in the Philippines did not enjoy the `®nancial basis
for bureaucratic self-con®dence [nor] the probity that it tends to bring'
(Wurfel, 1988: 79). Finally, some scholars maintain that the persistence of
2. Calculated from Republic of the Philippines, Commission on Elections (various years).
750
Gabriella R. Montinola
bureaucratic corruption in the post-war period is due in part to the Japanese
occupation. They argue that corrupt behaviour was legitimized during the
occupation, when `it was patriotic to cheat the occupying power' (Clemente,
1971: 134; Wurfel, 1988).
These are plausible explanations, and this paper does not directly
contradict them.3 Whatever their merits, however, these explanations leave
several crucial questions unanswered. If corruption in government was seen
as legitimate, why were there repeated calls for the `moral regeneration' of
public ocials? If the lack of meritocratic appointment procedures and low
salaries were causes of bureaucratic corruption, why was there little reform to
remedy these problems? There were many reports by experts advocating
reform of appointment procedures and pay scales (discussed below), but few
of the recommendations in those reports were e€ectively implemented.
Finally, if as conventional wisdom suggests, democracy leads to accountability of public ocials, why did bureaucratic ineciency and corruption
persist in the Philippines despite reasonably competitive elections, an
extremely free press, and a seemingly independent Supreme Court? (Wurfel,
1988: 88±90).
I believe that the principal±agent model presented in the previous section
provides a more coherent response to these questions than other
explanations. A closer examination of the experience of the Philippines will
determine whether the case is consistent with expectations derived from the
model.
The Persistence of a Weak State
The ®rst president of the Republic of the Philippines, Manuel Roxas, faced a
daunting set of tasks. Political sovereignty was transferred from the United
States to the Philippines on 4 July 1946, before the country had even begun to
recover from the destruction wreaked during the Second World War. Heavy
®ghting on Philippine soil had resulted in severe casualties and destruction of
the country's productive assets. Three years of Japanese occupation had
disrupted production in the country's main industries. The cost of living in
1946 was seven times higher than in the period just before the war. Relations
between employers and labourers in Manila were tense due to the failure of
wages to rise proportionately (Jenkins, 1954: 99). In the countryside,
landlord±tenant relations were also strained. Increasing oppression of
peasants by landlords' militias and government soldiers would soon lead
3. To do so would require a test of competing hypotheses using more than one case. My work
on Chile, however, casts doubt on one argument. Elections and party politics preceded the
development of a civil service in Chile, yet the Chilean state has e€ected signi®cant social
transformation (Montinola, 1997).
Politicians, Parties, and the Persistence of Weak States
751
to a peasant rebellion led by members of the Hukbong Mapagpalaya ng
Bayan (Huks) (Kerkvliet, 1977: 157±88).
In addition to facing these economic and political diculties, the Roxas
administration was dogged by corruption scandals, the largest of which
involved the sale of war surplus property. Under the Rehabilitation Act of
1946, the US government was authorized to transfer to the Philippine
government US military surplus property valued at US$100 million. A
Philippine Surplus Property Commission was created to dispose of the
property. When all the military equipment had been sold, the Philippine
government obtained $60 million less than expected. Some controversy
existed over the actual value of the property, but the discrepancy between
expected and actual values was so great, that even Roxas's press secretary did
not deny accusations that property had been sold at a fraction of its worth in
exchange for kickbacks (Gleeck, 1993: 61±4).
During his election campaign, Roxas had declared that he would save the
country from a number of evils, including government corruption (Jenkins,
1954: 82). Whether Roxas intended to ful®l his promises or not, any hope of
his doing so was cut o€ by his sudden death two years into his term. The task
of building an e€ective state and promoting economic development then fell
upon his Vice-President, Elpidio Quirino, who was himself elected president
in 1949. Assessments of Quirino's administration are mixed at best.
Under the Roxas administration, the Philippines imported almost twice as
much as it exported, and the import surplus was paid for by drawing down
Philippine foreign exchange reserves in the United States and by taking
advantage of the uncommonly high world price of copra, one of the
Philippines' traditional exports (Power and Sicat, 1971: 31). In 1948, a drop
in copra prices and the continued failure of domestic industry to meet
demands for consumer goods resulted in a trade imbalance so severe that in
1949, with the recommendation of an International Monetary Fund (IMF)
mission and the required approval from the United States president, the
Quirino administration adopted import and foreign exchange controls
(Baldwin, 1975: 20; Central Bank of the Philippines, hereafter CBP,
December 1949; Jenkins, 1954: 133±4).
The rent-seeking opportunities created by the controls prompted a strong
entrepreneurial response, and import and foreign exchange restrictions which
started as a balance of payments emergency measure soon became part of an
explicit industrialization strategy (Baldwin, 1975: 25; Power and Sicat, 1971:
33). Firms that received import licences and corresponding foreign exchange
allocations at the ocial exchange rate received substantial windfall gains.
Implicit rates of protection in the 1950s suggest that those who owned or
controlled businesses in the industrial sector received pro®ts of over 200 per
cent on commodities subject to quantitative restrictions (Baldwin, 1975: 98).
Controls were clearly successful in stimulating industrial growth. The growth
rate of value added in manufacturing from 1950 to 1956 was 10.5 per cent
(Power and Sicat, 1971: 39). Moreover, economic activities within the
752
Gabriella R. Montinola
manufacturing sector were signi®cantly diversi®ed. In 1948, food, beverages,
and tobacco accounted for 60 per cent of all value added in manufacturing.
By 1956, the share of these products had dropped to 44 per cent, while that
of textiles, chemicals, basic metals and machinery increased signi®cantly
(Baldwin, 1975: 123).
The potential for extra-normal pro®ts turned the agency created to
administer controls, the Import Control Oce, into an arena of pernicious
accommodation between politicians, bureaucrats and societal forces seeking
rent-inducing privileges. Testifying before a Senate Committee in 1953, the
chairman of the Import Control Oce con®rmed that politicians often
stopped by his oce to intercede for particular ®rm owners. He insisted that
the presence of such prominent individuals did not a€ect the decisions of his
oce. Yet he stated, `I gave privileges to senators and congressmen. They
didn't have to wait long because I wanted to show the people that [congressmen and senators] should be respected' (Philippines Free Press, hereafter
PFP, 21 February 1953: 2). These prominent elected ocials were well
rewarded for their services. Shortly after import and exchange controls were
established, the term `ten percenter' became popular (Hartendorp, 1961:
300±1; Manila Chronicle, hereafter MC, 7 October 1950: 1). The term
referred to elected ocials who were allegedly paid 10 per cent of the dollars
allocated to ®rm owners for their assistance in securing foreign exchange
licences.
As early as 1952, increasingly frequent scandals involving congressmen
and the Import Control Oce prompted Congress to allow legislation
authorizing controls to lapse. But with an eye to the impending 1953
elections and the need to maintain economic stability, President Quirino
decided to continue to restrict foreign exchange transactions through the
reputedly more insulated Central Bank. The move was not sucient to win
him re-election. Nacionalista party candidate, Ramon Magsaysay, beat
Quirino, the incumbent Liberal, by a substantial margin. Moreover, the
Nacionalistas won ®ve out of eight seats up for election in the Senate and 60
per cent of the seats in the House of Representatives.4
During his campaign, Magsaysay declared, `I will clean up all the garbage
of graft and corruption that the Liberals have piled up in our government!
Just give me a chance and I'll show the Liberals what a good garbage
collector I'll turn to be' (Gleeck, 1993: 138). Accordingly, his ®rst ocial act
was an executive order creating a Commission to investigate complaints
against bureaucrats (Corpuz, 1966: 228). He also authorized a survey of the
civil service's pay and position-classi®cation system, intending to overhaul
existing arrangements (Iglesias, 1967: 21). But the change in government and
comprehensive studies did not lead to e€ective adoption of reforms. Congress failed to appropriate sucient funds for the implementation of reforms,
4. Calculated from Republic of the Philippines, Commission on Elections (various years).
Politicians, Parties, and the Persistence of Weak States
753
and before long charges of in¯uence-peddling were again being hurled at
public ocials, including Central Bank ocials (Carroll, 1965: 180±3; Stifel,
1963).
Magsaysay's attempt to reform the bureaucracy was certainly not the ®rst
by a chief executive (de Guzman, 1968). In 1947, under the Roxas administration, a joint commission of Philippine and US experts investigated the
®nancial and budgetary problems of the Philippine government. The
commission recommended various strategies to strengthen the Bureau of
Internal Revenue, including raising salaries to improve morale, increasing
personnel in collection agencies, initiating criminal proceedings against
corrupt ocials, and applying criminal penalties for tax evasion (Jenkins,
1954: 110±19). In 1950, under the Quirino administration, another economic
survey mission, a group composed of US experts commonly referred to as the
Bell Mission, examined the country's ®nancial problems. The Bell Mission
recommended strategies to strengthen the capabilities of the Philippine civil
service, including more stringent recruitment examinations, better training,
and higher salaries (Corpuz, 1966: 226). Few recommendations were implemented. As one astute observer noted: `The way to crisis in the Philippines
[was] paved with good reports' (Jenkins, 1954: 157).
The extent to which the state continued to be corrupted by societal forces
even after Magsaysay's earnest attempts is illustrated poignantly by the case
of Harry S. Stonehill, an American soldier stationed in the Philippines during
the war.5 Stonehill started various businesses in the Philippines after his
discharge from the US Army in 1946. Over the course of ®fteen years, he
built an empire of more than forty establishments in various industries
including the tobacco, textiles, steel, glass, cement and real estate industries.
While rumours regarding the causes of Stonehill's phenomenal success in
business were widespread among the business community, the key to his
success was exposed completely in 1962 when a disgruntled associate
reported Stonehill's business strategies to the National Bureau of Investigation (NBI). Documents seized by the NBI suggested that Stonehill had been
treated favourably by many government agencies because of his connections
to prominent ocials. Some of the privileges Stonehill corporations received
were substantial loans from the government-owned Philippine National
Bank; exemptions from import restrictions on Virginia tobacco; especially
tight import protection for his cotton and glass enterprises; and particularly
generous allotments of foreign exchange for his import needs.
Over 130 public ocials were alleged to have received a total of US$1.5
million for their e€orts in building and protecting the Stonehill empire.
Members of the two dominant political parties of the period were implicated,
including thirty-four Nacionalista and sixteen Liberal high elected ocials
5. The details of the Stonehill case presented here are from Simbulan (1965: 299±318) and
PFP (July±August 1963).
754
Gabriella R. Montinola
and cabinet members. Among the politicians implicated were one former
Nacionalista president and the incumbent president, a Liberal (PFP, 27 July
1963: 2±3).6 The Stonehill a€air was not the only highly publicized case.
Examination of newspapers and congressional committee proceedings on
corruption suggest strongly that Stonehill's strategy in business was the norm
rather than an aberration.
The executive branch was not the only one concerned by bureaucratic
ineciency and corruption. The Senate Blue Ribbon Committee and House
Committee on Good Government were continuously engaged in the business
of ferreting out corruption in government. In 1958, legislators in the Senate
and House introduced anti-corruption bills, recommending various combinations of provisions including: (1) a requirement that all public ocers
declare assets and liabilities; (2) the creation of special courts or tribunals to
handle corruption cases; (3) immunity for witnesses; (4) permission for
private persons to initiate prosecution in such cases; and (5) suspension of
ocials awaiting prosecution for corruption (Iglesias, 1967: 22). After two
years of debate, an anti-corruption bill was ®nally passed in 1960 and signed
by President Carlos Garcia (Iglesias, 1967: 61).
The bill had little e€ect. In 1962, the Department of Finance and the NBI
discovered that thirty-four ®rms had been illegally exporting copra since 1957
with the assistance of a clique of customs ocials. The overshipment cost the
government over US$500 million in foregone export taxes, yet none of the
participants were indicted (PFP, 3 August 1963: 2±3). In 1964, seven congressmen, ®ve governors, ®ve city mayors and several lower level ocials
were found to have been involved in the smuggling of imported cigarettes.
Few of them were indicted (Gleeck, 1993: 307±8).
Shortly after his inauguration in 1962, Garcia's successor, President
Diosdado Macapagal created a Presidential Anti-Graft Committee whose
task was to assist the Department of Justice by gathering evidence against
corrupt ocials. In the committee's 1964 annual report to the president, the
chairman wrote:
I can say without hesitation that the overall picture of the performance of this Committee is
still NO HITS, NO RUNS, ALL EXPENSES! . . . a general view of the situation leads to the
conclusion that graft and corruption have invaded all branches of the government on a
nationwide and a more massive scale . . . after three (3) years of shaky existence, this
Committee, through no faults of its own, has miserably FAILED TO SEND TO JAIL A
SINGLE PUBLIC CROOK (Climaco, 1965a: 185).
In 1964 alone, the committee found evidence of corruption in hundreds of
cases, but no convictions ensued (Climaco, 1965b: 191±2). A headline in one
6. Macapagal denied any unethical involvement with Stonehill. One source suggests that
Macapagal received ®nancial aid for his campaign from Stonehill, and the latter counted
on exercising in¯uence on the Macapagal administration. It is noted, however, that
Macapagal never engaged in illegal or immoral activity with Stonehill (Gleeck, 1993: 265).
Politicians, Parties, and the Persistence of Weak States
755
popular weekly read, `Is the Administration Unable or Unwilling to Go after
the Smugglers? Has Everybody Been Bought?' (PFP, 28 March 1964: 6). The
headline referred to the Macapagal administration but would have been
appropriate for all six administrations from 1946 to 1972. In a survey of
bureaucrats conducted in 1971, two thirds of the respondents agreed that
corruption in government was widespread (Clemente, 1971: 136).
This article considers not whether but why each administration was unable
or unwilling to reduce corruption and ineciency in government. The
principal±agent theory of state capacity presented in the previous section
argues that if electoral preferences are not structured largely along a single
continuum, then it will not be in the interest of politicians to initiate
bureaucratic reform. It is therefore relevant to examine legislative votes and
the bases of party support in the electorate to determine whether or not
politicians and parties aggregated preferences over di€erent issues such that
competition occurred largely along a single dominant dimension. Undoubtedly, in new democracies, the preferences of certain actors, such as economic
eÂlites, are more likely to be represented than others. Using legislative votes to
infer the structure of electoral demands assumes only that Philippine
politicians are vehicles for the aggregation of issues salient to that part of the
electorate that is relevant to their re-election chances.
The Structure of Electoral Demands
The structure of an electorate's demands is a function of individuals'
preferences over di€erent universalistic and particularistic issues and the
political institutions that channel those preferences. The most common
institution for aggregating preferences is the political party. Hence, one
method for determining the structure of an electorate's demands is through
analyses of party platforms (Budge, et al., 1987). However, party platforms
are useful indicators of competition between social forces only if they
correspond to the actual behaviour of politicians, parties, and the electorate.
Party platforms in the Philippines from independence to 1972 were no more
than platitudes or wish lists, and they were very poorly di€erentiated. Thus,
to determine whether Philippine politicians were competing in an arena
con®ned to a single dominant dimension, I use two other methods: analyses
of legislative votes (Andrews, 1996; Heckman and Snyder, 1997; Poole and
Rosenthal, 1991), and analyses of election results.
Legislative Votes as Indicators
This section focuses on divided votes in the Philippine House of Representatives from the Third to Sixth Congresses. A vote was considered divided if at
least 10 per cent of legislators present voted against the winning side. The vast
majority of House votes during the period under investigation were
756
Gabriella R. Montinola
unanimous. The proportion of divided to unanimous votes in the House for
each Congress ranged from 0.3 per cent to 0.8 per cent.7 This suggests that
division is a clear indicator of issue saliency. Representatives will vote against
the majority only when it really matters to their supporters, or at least that
section of their supporters that they deem important to their re-election
chances. Thus, the structure of divided votes in the House provides a strong
indicator of the structure of politically relevant preferences.
Examination of divided votes in the House of Representatives shows
relatively strong party discipline, especially among members of the presidents' parties. An average of 91.5 per cent of the president's party voted for the
president's bills through the four congressional sessions covering 1954±69.
Opposition party members appeared to be slightly more susceptible to cross
pressures, although they were still relatively cohesive, with 80±7 per cent of
opposition party members voting together through time.8 This relatively
strong discipline in a two-party system seems to suggest that competition over
policy was structured along a single party-de®ned dimension.
To determine better the structure of competition in the House, principal
component analyses (PCA) were performed on legislative votes in the four
congressional sessions.9 Table 1 presents statistics associated with the ®rst
three dimensions extracted from legislative votes recorded during the Third
to Sixth Congresses, including the percentage of total variance in votes
explained by, and the percentage of votes highly correlated with, the ®rst
7. The ®gures represent the number of divided votes on the ®nal reading of bills over the total
number of bills passed in the House for a particular Congress. Data on bills passed by the
House are reported in the History of Bills and Resolutions (1954±69), an annual summary
of congressional sessions. Data on divided votes were collected by the author from the
House of Representatives' Congressional Record for each session during 1954±69. Many
divisive votes in the House occurred during the amendment procedure. Divided votes on
amendments are included in the data set. Because there is no readily available source for
the total number of votes on amendments, I cannot provide the proportion of divided
votes on amendments to total number of votes on amendments. From the Third to the
Sixth Congresses, there were six votes that were divided but not up to the 10 per cent
threshold. These were excluded from the data set. Also excluded were a handful of highly
particularistic votes, such as the renaming of streets, schools, etc., that were opposed by
only one or two House members.
8. Calculated from nominal votes published in Republic of the Philippines, House of
Representatives, Congressional Record, Third±Sixth Congresses.
9. PCA is a procedure that transforms a set of related variables, such as legislative votes, into
a set of uncorrelated principal components or underlying dimensions. Principal components are extracted in descending order according to the amount of variance in the original
variables for which they account. If the variables are highly correlated, although as many
principal components as variables are extracted, one or few dimensions will account for
most of the variability in the original variables. PCA is discussed in a number of social
science statistical textbooks. One particularly useful text solely on PCA is Jackson (1991).
The data consisted of all nominal votes for which at least 10 per cent of legislators present
were in the minority. Votes were coded as 1 for negative votes, 0 for abstentions or
absences, and 1 for armative votes.
Politicians, Parties, and the Persistence of Weak States
757
Table 1. Principal Component Analyses: Legislative Votes in the Philippine
Congress as Variables
III
1954±7
IV
1958±1
V
1962±5
VI
1966±9
12.94
3.04
1.68
9.74
2.64
2.00
19.48
1.99
1.54
13.15
2.33
1.46
B. % of total variance explained
Dimension 1
36.96
Dimension 2
8.68
Dimension 3
4.80
30.45
8.26
6.26
52.64
5.39
4.16
48.70
8.61
5.42
81.1
0
0
77.8
0
0
Congressional sessions
A. Eigenvalues
Dimension 1
Dimension 2
Dimension 3
C. % of votes strongly correlated with dimensions
Dimension 1
57.1
40.6
Dimension 2
0
9.4
Dimension 3
0
6.2
three dimensions extracted. The data indicate that the structure of legislative
competition varied across sessions. This is most evident when we compare
the di€erent percentages of total variance explained by the ®rst dimension in
each session and the di€erent percentages of votes strongly correlated with
each dimension in each session. The higher the percentage of total variance
explained by the ®rst dimension and the higher the number of votes strongly
correlated with the ®rst dimension, the closer legislative competition is to
being perfectly unidimensional. On the other hand, low percentages of total
variance explained by the ®rst dimension and low numbers of votes strongly
correlated with the ®rst dimension signify multidimensional competition.
As reported in Table 1, the ®rst dimension extracted explained 37 per cent
of the total variance in votes of House members during the Third Congress
(1954±7); 30 per cent of the variance in votes during the Fourth Congress
(1958±61); and 49 per cent or more of the variance in votes during the Fifth
and Sixth Congresses (1962±5 and 1966±9) (Table 1, Section B). Furthermore, 57 per cent of votes taken during the Third Congress were strongly
correlated with the session's ®rst dimension,10 and corresponding ®gures for
votes strongly correlated with the ®rst dimension for the Fourth, Fifth and
Sixth Congresses were 41 per cent, 81 per cent, and 78 per cent, respectively
(Table 1, Section C). Moreover, the table shows that the second dimension
extracted from votes taken during the four congresses accounted for less than
9 per cent of the variance in votes, while the third dimension explained 6 per
cent or less of the variance in votes taken during the four congresses. Finally,
10. Following one established convention, I considered votes strongly correlated with
dimensions if they had a component loading (or correlation coecient) of 0.6 or better
(Kline, 1994).
758
Gabriella R. Montinola
as reported in the table, no votes were strongly correlated with the second
and third dimensions for the Third, Fifth and Sixth Congresses. However, a
number of votes were strongly correlated with the second and third
dimensions of the Fourth Congress: 9 per cent of votes taken during the
Fourth Congress were correlated with a second dimension, and 6.2 per cent
of votes were correlated with a third dimension.
These results indicate that (1) competition during the Fifth and Sixth
Congresses occurred along a single dominant dimension; (2) competition
during the Third Congress occurred along a dominant dimension, although
it was less unequivocally dominant than the ®rst dimensions of the Fifth and
Sixth Congresses; and (3) competition during the Fourth Congress was
multidimensional. The percentages of variance explained by and the number
of votes strongly correlated with the ®rst dimensions during the Fifth and
Sixth Congresses were extremely high. The percentage of variance in votes
explained by the ®rst dimension during the Third Congress was slightly
lower, but no votes were strongly correlated with the second and third
dimensions of the Third Congress. In contrast, the percentage of variance
explained by, and the number of votes strongly correlated with, the ®rst
dimension of the Fourth Congress were relatively low. Furthermore, over 15
per cent of votes cast during the Fourth Congress were strongly correlated
with a second and third dimension.
If the structure of competition was e€ectively unidimensional in at least
three out of four congressional sessions, why was there no successful bureaucratic reform during these sessions? In fact, politicians were competing in a
multidimensional arena Ð which becomes apparent only when one considers the substance of legislative votes and policy positions taken over time.
These points are considered below.
Table 2 shows the number of divided votes cast in the House from 1954 to
1969, classi®ed by issue.11 As the table shows, four issues dominated the time
and attention of legislators, although some issues were more salient in
11. Interpreting the substance of bills being voted on is not always straightforward. Many bills
have provisions that are not related to their primary theme. In general, however, it
appeared appropriate to classify votes on bills (and amendments to bills) according to the
subject of their titles. Votes on bills that were extremely comprehensive, such as appropriations bills, or highly particularistic, such as a bill granting Cebu Heavy Industries a
franchise to establish taxicab services in Manila, were coded as miscellaneous bills. In his
extensive study of the Philippine Congress, Robert Stau€er (1975: 19±21) classi®ed bills
according to their nature (i.e., particularistic versus universalistic) and according to thirtyfour substantive categories. In contrast, I classify bills into ®ve groups. The di€erence in
classi®cation schemes re¯ects the di€erences between Stau€er's data set and goals, on the
one hand, and mine on the other. Stau€er considered both unanimous and contested votes
passed by the legislature and was interested in tracking the level of attention that
congressmen a€orded highly speci®c issues through time. I considered only contested votes
(a signi®cantly smaller set of legislative votes than Stau€er's set) and was more interested
in classifying issue dimensions of competition based on aggregated societal interests.
Politicians, Parties, and the Persistence of Weak States
759
Table 2. Divided Votes by Issue in Congressional Sessions during 1954±69
3rd Congress
(1954±7)
4th Congress
(1958±61)
5th Congress
(1962±5)
6th Congress
(1966±9)
Foreign Economic Policy
Social Welfare Policy
Control over Appointments &
Public Spending
Local Government Autonomy
Other
4
10
12
10
8
2
10
8
5
1
8
2
1
8
3
9
0
14
6
10
Total
35
32
37
27
Issue
Source: Calculated from record of votes in Republic of the Philippines, House of
Representatives, Congressional Record.
particular sessions. The issues were foreign economic policy, social welfare
policy, local government autonomy, and the division of control over
appointments and public spending between the President and Congress. The
protagonists in the debates on foreign economic and social welfare policies
and the nature of their demands over the two issues are described below.
Bills a€ecting the degree to which Philippine markets were to be reserved
for Filipino business were classi®ed under the category of foreign economic
policy. This category included bills on exchange rate, trade, and foreign
investment policies. The key protagonists in this debate over the appropriate
degree of protectionism were families that owned export-oriented concerns,
such as sugar planters and millers, miners, loggers, and coconut farmers, on
the one hand; and families that controlled commercial and industrial ®rms
that served the domestic market, on the other (Golay, 1961: 312±45;
ValdepenÄas, 1970: 70±1).12 Views of both groups were culled from newspapers and trade journals, such as sugar planters' Sugar News (SN) and
industrialists' Industrial Philippines (IP).
The largest domestic manufacturers were members of the Philippine
Chamber of Industries (PCI), a confederation of industry-speci®c chambers.
From independence to 1972, the PCI urged legislators to support protectionist measures, such as tari€s, and import, foreign exchange and foreign
investment restrictions (Araneta, 1965; Boyce, 1993: 7; IP, September 1965:
16±21; September 1966: 8±12). One measure that greatly concerned the PCI
and manufacturers for the domestic market was a proposal to extend the
Philippine Trade Act of 1946. The 1946 Act speci®ed the conditions that
would govern Philippine±American economic relations after sovereignty had
been transferred to the Philippine government. It contained three provisions
that manufacturers for the domestic market found particularly onerous.
12. See also PFP (30 May 1959: 14; 13 June 1959: 14; 17 February 1962: 2; 5 May 5 1962: 5).
760
Gabriella R. Montinola
First, the act required reciprocal free trade between the two countries for
eight years, to be followed by a twenty-year period of gradually diminishing
privileges. Second, the act speci®ed that the value of the Philippine peso be
®xed at the pre-war rate of US$2 to P1, that the convertibility of pesos into
dollars would not be suspended, and that no restrictions would be imposed
on the transfer of funds from the Philippines to the United States, except by
agreement with the President of the United States. Third, the act called for
parity or equal rights for US citizens in the development of natural resources,
operation of public utilities, and ownership of business enterprises in the
Philippines.13 Not surprisingly, the PCI was against extension of the Trade
Act. In 1965, the PCI argued: `Parity should be repealed immediately because
ten more years of the same . . . could easily result in placing the meaningful
and strategic areas of the national economy under the control of nonFilipinos' (IP, September 1965: 16).
In contrast with manufacturers for the domestic market, exporters
advocated extension of the Philippine Trade Act, asserting that preferential
treatment of Philippine products in the US market was tied to tax and tari€
privileges a€orded US products in the Philippine market. The views of
exporters were represented by confederations of commodity-speci®c export
associations, such as the Producers and Exporters Association of the
Philippines, the Chamber of Agriculture and Natural Resources (CANR)
and the Philippine Sugar Association (PSA). Exporters discounted fears that
parity rights, and foreign investment in general, would lead to loss of
national sovereignty. In a panel discussion on foreign economic policies,
CANR president Alfredo Montelibano criticized manufacturers' attempts to
reserve the economy for Filipinos by ®at as hypocritical and detrimental to
the economy (SN, August 1952: 385; February 1954: 55). Exporters were not,
however, for free trade per se. They opposed tari€s on US products for fear
of US retaliation but advocated government intervention in favour of their
sector, including policies maintaining the weak peso, export tax exemptions,
and credit subsidies (IP, June 1968: 26±8).
The second set of bills that dominated legislators' time and attention
involved policies commonly associated with social welfare Ð namely, tax
and spending policies as well as agrarian and labour reform. Key protagonists on this social welfare issue were landlords and industrialists on the one
hand, and labour and landless farmers, on the other. The policy position of
landlords against one major form of social welfare legislation Ð agrarian
reform Ð was most starkly presented by Manuel Gallego, President of the
National Rice Producers Association (NRPA). Gallego likened land reform
to `a form of legalized robbery' (PFP, 16 April 1955: 2). Moreover, he argued
that subdivision of estates into family-size farms would displace tenants, who
would then turn to communism. This position was vigorously opposed by the
13. Philippine Trade Act of 1946, Title III, Section 342, cited in Jenkins (1954: 68).
Politicians, Parties, and the Persistence of Weak States
761
Federation of Free Farmers (FFF) (Wurfel, 1958a: 15; 1958b: 29). The FFF
represented several thousand tenant and landless farmers in more than two
dozen provinces.
Industrialists were less strenuously opposed to agrarian reform than
landowners. They tended to advocate agrarian reform whenever social unrest
escalated. They did, however, oppose progressive wage legislation for urban
workers, unionization and collective bargaining (IP, July 1970: 36). On these
issues, they were in opposition to urban labour organizations such as the
Federation of Free Workers, the Philippine Trade Union Council and the
Katipunan Manggagawa Pilipino (KMP). By 1957, thirteen loosely organized
labour federations were engaged in activities designed to protect trade union
rights, and the rapid decline of real wages from 1960 heightened union
activity (Ramos, 1976: 282±3).
In sum, Philippine legislators spent a good deal of their time discussing
protectionist and social welfare policies. This is unsurprising given the
country's low level of industrialization and high level of wealth inequality.
The crucial question is whether politicians and parties readily changed
positions on these salient issues in a manner highly inconsistent with a
unidimensional structure of electoral preferences. If the Philippine electorate's preferences over social welfare and foreign economic policies aligned
along a single dimension, we would observe that a move toward more
protectionist policies would be accompanied by a corresponding move on the
issue of redistribution of wealth, and vice versa. In many Latin American
countries, for example, demands for economic protectionism tended to be
correlated with demands for more government redistribution of wealth, while
demands for freer trade were often associated with demands for less
government redistribution of wealth (Skidmore and Smith, 1997). Moreover,
if competition in the Philippines occurred largely along a single dimension,
we would expect politicians and parties to have changed voting behaviour in
the legislature depending on their perceptions of politically relevant voters'
preferences, but we would expect them rarely to reverse positions completely
on both issues. In fact, Philippine politicians and parties freely reversed
positions on foreign economic and social welfare policies, suggesting that
competition to in¯uence policy occurred along more than a single dominant
dimension.14
For example, under the leadership of president Magsaysay (1954±7) the
Nacionalistas, who held the majority in Congress, passed relatively progressive policies (understood as policies designed to bene®t the poor majority). In
particular, they passed three agrarian reform bills: the Agricultural Tenancy
Act of 1954, the Act Creating the Agrarian Relations Court, and the Land
14. The following discussion of legislators' policy positions is based on their nominal votes in
the House of Representatives published in the Congressional Records for the Third to
Fifth Congresses.
762
Gabriella R. Montinola
Reform Act of 1955. In retrospect, one can see that these bills, which were
greatly diluted as they made their way through Congress, resulted in minimal
changes in conditions of farmers (Putzel, 1992: 91±2, 113±5; Reidinger, 1995:
87±91).15 In the bills' ®rst years of operation, however, the Nacionalistas
were able to claim credit for providing tenants with slightly more favourable
sharing arrangements, greater security of tenure, and a court which favoured
the landless (Wurfel, 1958a, 1958b). Prior to the enactment of the Land
Reform Act of 1955, tenant farmers and peasant leaders had been sceptical
about the prospects of rural reform and the government's concern for their
interests. After the bill's enactment, `many of the rural people were convinced
that . . . their stake in [the government] had increased perceptibly' (Starner,
1961: 199).
The Nacionalistas also appeared to favour exporters while under the
Magsaysay administration. The agrarian reform bills were notable for their
exemption of the most powerful group of exporters: sugar plantation owners.
Farmworkers in sugar plantations were wage labourers not tenant farmers,
hence sugar producing lands were not a€ected by the agrarian reform acts.
Moreover, the Nacionalistas passed two bills strongly advocated by
exporters Ð the extension of parity rights for US citizens in the Philippines,
which was discussed earlier, and the No Dollar Import Law. Exporters had
been pressing for the latter since the advent of import and exchange controls
under the Liberal majority in 1949. The law was passed by the Nacionalistacontrolled House in 1955. It allowed export industries to barter exports for
imports outside the exchange and import control system. The act drew
vigorous resistance from importers and manufacturers for the domestic
market because it diluted their control over goods available in the domestic
market (Golay, 1961: 96).
Although the bills passed by the Nacionalista majority in the Third
Congress tended to favour export industries, the party did provide a few
concessions to economic nationalists. In 1954, the Nacionalistas voted
together with Liberal members to pass the Retail Trade Nationalization Act
of 1954. The bill banned non-citizens from engaging in retail businesses in the
Philippines. This concession to Philippine commercial interests was possible
because the act was primarily directed at Chinese businessmen and did not
directly a€ect Philippine±US relations, given US citizens' parity rights
(Agpalo, 1962). Philippine exporters' interests were not harmed so long as
mutually advantageous trade relations with the US were maintained.
As the Retail Trade Nationalization bill moved through the House, the
Liberals attempted to strengthen its nationalist component with amendments
calling for expropriation of alien property. Although their amendments were
15. Indeed, immediately after the bill was enacted, one astute contemporary observer
questioned the ability of the government to implement it, given its ®nance provisions
(Starner, 1961: 198).
Politicians, Parties, and the Persistence of Weak States
763
defeated, the Liberals ultimately voted for the bill together with the
Nacionalistas. They did, however, berate the majority party for coddling
alien businessmen. As one prominent Liberal congressman stated:
It is the stand of the [Liberal party] that it should seek, not only now but in the future . . . a
complete and drastic nationalization bill not only on retail trade but also on wholesale trade
or business in basic commodities, in rice, corn, ¯our, tobacco, lumber, sugar and the like.16
In short, the Nacionalista party was relatively progressive and exporteroriented during the Third Congress from 1954 to 1957.
In April 1957, President Magsaysay died in a plane crash, and his vicepresident and fellow Nacionalista, Garcia, assumed the presidency. Garcia
emerged as the party's nominee in the November elections held later that year
and was opposed by Liberal Jose Yulo, a member of one of the wealthiest
families in the sugar industry. Garcia won with a plurality of the vote in a
three-candidate presidential race, and 59 per cent of Nacionalista incumbents
in the House were re-elected in 1957.17
Although a majority of Nacionalista party members was re-elected, the
party completely reversed its positions in the legislature on foreign economic
and social welfare policies from 1957 to 1961. The party passed policies that
favoured producers for the domestic market rather than exporters (Baldwin,
1975: 123±5; ValdepenÄas, 1970: 44±5). In 1959, the Nacionalistas passed a
bill revoking all import tax exemptions that they had voted for only six years
earlier. Moreover, they repealed the No-Dollar Import Law that they had
passed in 1955 and passed a bill which imposed a levy on the foreign
exchange earned and sold by exporters. The party also began to block
consideration of legislation favouring the lower classes. The only legislation
passed by the Fourth Congress that could be considered progressive was a
price control act for various essential commodities which barely o€set the
increase in prices generated by other tax measures.
Similarly, the Liberals demonstrated a reversal of policy position with
respect to foreign economic policy. The Liberals, who had only three years
earlier accused the Nacionalistas of selling out to alien businessmen, began
calling for repeal of the retail trade nationalization law on grounds that it
discouraged foreign investment. The Liberals did maintain their conservative
stance with respect to social welfare policies during the Fourth Congress, but
this policy position would soon be reversed.
In 1961, the Liberal candidate, Macapagal, was elected president on a
relatively progressive and export-oriented platform. A major re-alignment
occurred in the House. Twenty-four out of ®fty returning Nacionalistas
16. Republic of the Philippines, House of Representatives, Congressional Record, Third
Congress, Second Regular Session, June 12, 1954: 3502.
17. Calculated from Republic of the Philippines, Commission on Elections Report to the
President of the Philippines and the Congress on the Manner the Elections Were Held (1958).
764
Gabriella R. Montinola
switched aliation to the Liberal party, leaving the Nacionalistas in the
minority (MC, 12 January 1962: 1). Under the leadership of Macapagal, the
`turncoats', as they were often referred to in the press, modi®ed their
positions on foreign economic and social welfare policies. Together with the
returning Liberals, they pushed through a bill lifting all foreign exchange
restrictions, e€ectively devaluing the peso. The bill bene®ted exporters and
hurt manufacturers for the domestic market, at least in the short run
(Baldwin, 1975: 60±1; Power and Sicat, 1971: 46±7).
The Macapagal administration, however, was not completely against
protectionist policies. Under Garcia, the Congress had passed a tari€ code
that a€orded protection of domestic manufacturing industries. At that time,
tari€s had little e€ect on industry pro®ts. Industries were already highly
protected by foreign exchange restrictions. With the lifting of currency
controls, tari€s became the principal instrument of protection for domestic
industries. Under the Macapagal administration, average tari€s rose by
approximately 5 per cent (Power, 1971: 269; Power and Sicat, 1971: 93).
In the social welfare realm, the Liberals, including the turncoats, passed a
new agrarian reform bill and a bill raising minimum wages. Assessments of
the welfare consequences of the 1963 Agricultural Land Reform Code are
mixed (Putzel, 1992: 114±17; Wurfel, 1988: 167). Moreover, the minimum
wage bill was insucient to raise workers' real standard of living (Baldwin,
1975: 147; Boyce, 1993: 28). The crucial point, however, is that the Liberal
party was able to claim immediate credit for passing seemingly progressive
bills.
In contrast, during the Fifth Congress, the remaining Nacionalistas
appeared more protectionist with respect to foreign economic policy and less
sensitive to the plight of the underclass. A majority of them voted against the
act to decontrol foreign exchange and worked hard to dilute the agrarian
reform bill through amendments.
In sum, parties shifted policy positions considerably from the Third to the
Fifth Congress in a manner highly inconsistent with a unidimensional
structure of electoral demands. This shifting of party positions is illustrated
in Figures 4A±4C. The ®gures represent the space along which demands of
various groups were arrayed. The vertical axes represent demands over
foreign economic policy. The horizontal axes represent demands over social
welfare policies. Party positions within the ®gures are meant to be illustrative.
The distance between parties' positions is not quantitatively derived.
As the ®gures and the above discussion show, neither party's position on
foreign economic policy covaried consistently with its position on social
welfare policy across congressional sessions. If policy re¯ects the interests of
politically relevant actors, then shifting of policy positions suggests that
parties were forming new coalitions of supporters at each election. The
formation of new coalitions in the electorate was, in part, due to the changing
mix of politicians in each party through time. As mentioned above, twentyfour Nacionalistas switched to the Liberal party shortly after the 1961
Politicians, Parties, and the Persistence of Weak States
Figure 4(a). Party Positions, 1954±57
Figure 4(b). Party Positions, 1958±61
765
766
Gabriella R. Montinola
Figure 4(c). Party Positions, 1962±65
elections. Fifteen Liberals switched to the Nacionalista party after the 1965
elections. If, as many scholars of Philippine politics suggest, voters are loyal
to individual politicians rather than parties, then party switching at the
legislative level is an indication of party switching at the level of the
electorate. Stated di€erently, party switching by politicians where voters are
loyal to individual politicians is evidence for weak party loyalties or weak
`parties-in-the-electorate'.18
Assuming that all societies are composed of individuals with various
interests, the presence of weak partisan loyalties is an indication that
demands are not aggregated along a dominant dimension. Strong partisan
attachments are insucient for policy competition along a single dominant
dimension because strong parties may continue to structure competition
along multiple dimensions. However, weak parties-in-the-electorate preclude
the aggregation of demands along a dominant dimension.
Election Results as Indicators
In a two-party system, one method for determining whether the electorate's
demands are arrayed along a single (and presumably party-de®ned) dimension is to determine whether voters identify with and vote consistently for the
18. The term is from V. O. Key (1942).
Politicians, Parties, and the Persistence of Weak States
767
same parties through time. Such analyses generally require public opinion
survey data, which are not available for the case and period under
investigation in this article. Consequently, I focus on the relationship
between election results and a voter characteristic that many students of
Philippine politics point to as the most salient determinant of voting
behaviour.
In particular, it has been argued that the most common criterion for
supporting an incumbent is his or her ability to provide public works and
patronage positions (Grossholtz, 1970; Lande, 1965). The time and attention
spent by legislators in Congress debating bills allocating control over public
spending suggests that they were well aware of this criterion. Moreover,
studies show that Filipinos are more likely to turn to politicians with family
and, consequently, ethno-linguistic ties when in need of such favours (Lande,
1965; Wurfel, 1988). These works suggest that the most likely single dominant dimension dividing the electorate may be de®ned by ethno-linguistic
groups. Thus, even if the electorate cares only about particularistic bene®ts, if
speci®c ethno-linguistic groups are loyal to speci®c parties, given the
Philippines' two-party system, their particularistic demands may be aggregated along a single party-de®ned dimension.
To determine whether speci®c ethno-linguistic groups consistently favour
one party over another, one could analyse the relationship between electoral
votes for congressional candidates and ethno-linguistic variables. However,
since no district-level data were available for the latter variables, I regressed
the provincial electoral vote for presidential candidate on ethno-linguistic
variables measured by province, in four elections from 1953 to 1965. Given
that presidential candidates are party leaders and have signi®cant control
over legislation as well as over members of their party in the House, this
analysis should help determine whether parties-in-the-electorate are divided
along stable ethno-linguistic lines. If the regression analyses show stable
partisan attachments based on ethno-linguistic aliation through time, given
the two-party system of the Philippines, we can conclude that the electorate's
demands aligned along a single dominant dimension de®ned by ethnolinguistic groups. If the analyses show that ethno-linguistic groups shifted
their support through time from one party's candidate to the other, this
would be evidence against the presence of a single dominant dimension of
competition based on ethno-linguistic aliation.
The results of the regression analyses are presented in Table 3. The
dependent variable is the percentage of the electoral vote for the Nacionalista
presidential candidate over the total vote for both Nacionalista and Liberal
parties by province.19 The independent variables are percentages of speci®c
ethno-linguistic groups to total number of residents by province for which
19. Calculated from Republic of the Philippines, Commission on Elections Report to the
President of the Philippines and the Congress on the Manner the Elections Were Held (1958).
768
Gabriella R. Montinola
Table 3. Regression of Provincial Vote for Nacionalista Party Presidential
Candidate on Ethno-Linguistic Variables
Ethno-linguistic group1
Ilocano
PampanguenÄo
Pangasinan
Tagalog
Bikolano
Cebuano
Ilonggo
Samar-Leyte
Muslim2
Other
N
1953
1957
1961
1965
0.39‡ (0.05)
0.86 (0.11)
0.72 (0.23)
0.82 (0.04)
0.71 (0.05)
0.71 (0.04)
0.70 (0.07)
0.63 (0.11)
0.62 (0.08)
0.68# (0.06)
53
0.56 (0.04)
0.25‡ (0.09)
0.37 (0.19)
0.58 (0.03)
0.49 (0.05)
0.81# (0.03)
0.50 (0.06)
0.53 (0.09)
0.58 (0.07)
0.58 (0.04)
54
0.25 (0.04)
0.27‡ (0.08)
0.52 (0.16)
0.41 (0.03)
0.44 (0.04)
0.53# (0.03)
0.42 (0.05)
0.46 (0.08)
0.45 (0.06)
0.44 (0.04)
54
0.87# (0.04)
0.11‡ (0.09)
0.36 (0.19)
0.57 (0.03)
0.48 (0.05)
0.52 (0.03)
0.51 (0.06)
0.50 (0.09)
0.33 (0.07)
0.51 (0.04)
54
Notes: 1Percentage population of speci®ed ethno-linguistic group over total number of residents
by province.
2
The Muslim category is a religious rather than an ethno-linguistic category. Muslims are divided
into three ethno-linguistic groups: Tausugs, Maranaos, Maguindanaos. Figures are aggregated for
the three groups.
‡
Liberal candidate's ethno-linguistic group; #Nacionalista candidate's ethno-linguistic group.
Sources: Republic of the Philippines Commission on Elections (1954, 1958, 1962, 1966, 1970);
Republic of the Philippines (1960).
census data were available.20 The category `other' includes the many smaller
minority groups across the country for which more speci®c census data were
not available. The table provides information on the voting behaviour of
speci®c ethno-linguistic groups within each province. Regression coecients
in this case indicate the average of the percentage of votes within provinces
received by the Nacionalista candidate from each group.21
As Table 3 shows, the Nacionalista presidential candidate's own ethnolinguistic group was clearly a factor in elections.22 Coecients for the
20. The ethno-linguistic groups are labelled as they are in the census data. The data take into
account the fact that some provinces are populated by several groups, while others are
populated by only one or two groups. Percentages were calculated from data provided in
Republic of the Philippines (1960).
21. On interpreting multiple regression coecients when the explanatory variables are
proportions, see Maddala (1992: 109±11).
22. In his comprehensive analysis of voting behaviour in the Southern Tagalog region of the
Philippines, Carl Lande (1973: 50±1, 98) concludes that in `supra-local' elections, including
presidential elections, the Tagalog region tended to favour Nacionalista candidates. This
®nding, which appears to be at odds with my own analyses, is due to the di€erent methods
and data used by Lande and myself. By taking the mean percentage vote for Nacionalista
candidates across towns in the Southern Tagalog region, Lande measured the region's
preference. That is, he measured the preference of the average Southern Tagalog town,
which could be populated by Tagalogs and individuals from other ethno-linguistic groups.
In contrast, the regression analyses I performed provide measures for each ethno-linguistic
group's preferences regardless of where they resided within the country. Thus, my ®ndings
are distinct from but not inconsistent with Lande's.
Politicians, Parties, and the Persistence of Weak States
769
indicator of votes from the candidate's own ethno-linguistic group were
extremely high, and standard errors were relatively low, pointing to a clear
tendency across provinces for particular ethno-linguistic groups to vote for
candidates from their own group. In 1957, the Nacionalista candidate,
Garcia, was a Cebuano and, on average, 81 per cent of Cebuanos within each
province voted for him. In 1965, the Nacionalista candidate, Marcos, was an
Ilocano; and on average, 87 per cent of Ilocanos within each province voted
for him. The Nacionalista candidate in 1953, Magsaysay, was extremely
popular across groups; but he did not win much support from his opponent's
ethno-linguistic group, the Ilocanos. On average, only 39 per cent of Ilocanos
within each province supported Magsaysay. In 1961, the unpopular
Nacionalista incumbent, Garcia, lost support across all groups; but on
average, 53 per cent of Cebuanos within each province continued to vote for
him.
In addition, Table 3 shows that vote shares of speci®c groups not related to
either presidential candidate were important factors in elections. Standard
errors for coecients of the di€erent ethno-linguistic variables were relatively
low, signifying that members of each group in di€erent provinces were voting
in similar ways. More importantly, Table 3 shows that the vote shares of
di€erent groups for the Nacionalista candidate changed substantially from
one election to the next.23 For example, examining coecients for the
indicator of votes from members of the Pangasinan group across the four
elections, we see that the Nacionalista party secured the support of this group
in 1953 and 1963, but lost the group's support in 1957 and 1965. On average,
72 per cent and 52 per cent of the Pangasinan vote within each province went
to the Nacionalista candidate in 1953 and 1961, respectively. The corresponding ®gures for the 1957 and 1965 elections were 37 per cent and 36 per
cent. Alternatively, Tagalogs supported the Nacionalista candidate in 1953,
1957 and 1965, and abandoned the Nacionalista in 1961. On average, 82 per
cent, 58 per cent, and 57 per cent of Tagalogs within each province voted for
the Nacionalista candidate in the 1953, 1957, and 1965 elections, respectively;
23. To determine whether coecients in each of the four regression equations were signi®cantly di€erent from those of subsequent equations, data on votes for the Nacionalista
candidate were pooled by pairs of elections. Two models were tested for three pairs of
election years: (a) 1953 and 1957; (b) 1957 and 1961; and (c) 1961 and 1965. Model 1 of
each pair of election years was constrained so that the e€ects of the ethnicity variable on
the vote for the Nacionalista presidential candidate were the same for both election years in
each pair. The ethnicity variable was measured in the same way as in Table 3. A dummy
variable for the ®rst election year in each pair was included in the equation to control for
secular changes across all groups. Model 2 allowed the e€ects of the ethnicity variable to
di€er between the two election years. The ethnicity variables were multiplied by dummy
variables for corresponding election years. The results con®rmed that the shift in votes of
the di€erent ethnic groups from election to election was substantial. F-ratios for the three
pairs of Models 1 and 2 were signi®cant well beyond the 0.01 level.
770
Gabriella R. Montinola
on average, only 41 per cent of Tagalogs within each province voted for the
Nacionalista candidate in 1961.
These swings in electoral support from one party's candidate to the other
were not simply a function of changing candidates. In 1961, the Liberal
candidate, Macapagal, won with substantial support from Ilocanos and
Tagalogs. In 1965, however, when he was the incumbent, Macapagal lost, in
large part due to the signi®cant proportion of these two groups that decided
not to support him. Table 3 provides data on the support of Nacionalista
candidates only, but given the e€ective two-party competition in the
Philippines at this particular point in time, one candidate's loss was the
other's gain. As Table 3 shows, on average, only 25 per cent of Ilocanos and
41 per cent of Tagalogs within each province supported the Nacionalista
candidate in 1961, indicating that a large majority of Ilocanos and Tagalogs
voted for the opposition Liberal candidate. In 1965, on average 87 per cent of
Ilocanos within each province and 57 per cent of Tagalogs within each
province voted for the Nacionalista candidate, indicating that a large
majority of these two groups had deserted the Liberal candidate.
In summary, the regression analyses show that ethno-linguistic group
aliation was an important factor in Philippine elections and that presidential candidates' ethno-linguistic support bases changed from election to
election. Since presidential candidates were also party leaders, the results of
the analyses indicate that Philippine parties were unable to organize stable
coalitions of supporters through time. The inability of Philippine parties to
maintain stable supporters given the country's e€ective two-party system
implies that competition to in¯uence policy occurred along more than a
single dominant dimension. That is, stability of party support bases does not
necessarily demonstrate unidimensional competition to in¯uence policy. For
example, if ethno-linguistic groups and party bases coincide perfectly in a
multiparty (that is, more than two-party) system, then parties can have stable
supporters and compete in a multidimensional arena. In a two-party system,
stability of support bases is evidence of competition along a single partyde®ned dimension. Conversely, instability of parties-in-the-electorate
indicates the presence of other dimensions of competition cutting across
the party-de®ned dimension.
This article has shown that there were numerous calls for and attempts to
improve bureaucratic performance in the Philippines from 1946 to 1972, but
that the calls went unheeded and the attempts failed miserably. It has also
shown that the structure of electoral preferences as aggregated by Philippine
political parties was multidimensional; that politically relevant groups were
competing to in¯uence policy on issues, including social welfare and economic nationalism, and that groups' demands over these issues did not align
along a single dominant dimension. The cross-cutting nature of competition
to in¯uence policy in the Philippines was evident in the party-switching
behaviour of individual politicians and policy-switching behaviour of parties.
The multidimensional nature of competition was also evident in the volatility
Politicians, Parties, and the Persistence of Weak States
771
of party support in the electorate. Based on the principal±agent theory of
state capacity presented earlier, we would expect minimal bureaucratic
reform and weak state capacity where electoral preferences fail to align
largely along a single continuum. The experience of the Philippines provides
support for the theory.
5. CONCLUSION
This article addressed the question of why some countries have strong state
capabilities while others do not. Of two alternative theories of state capacity,
the ®rst, Migdal's state-in-society theory of state strength, maintains that
variation in state capabilities across developing countries is the result of
macro-historical forces, such as the spread of capitalism and colonialism
from Western Europe. The second, Geddes's theory of state capacity, holds
that variation in state competence is the result of micro-level factors such as
the preferences and calculations of politicians given the particular structures
of incentives and opportunities that they face.
Both approaches provide valuable insights into the issue of state-building
but neither provides an entirely satisfactory framework. The state-in-society
approach provides a comprehensive explanation for the variation in distribution of social control and state capacity in former colonies at independence,
but it appears to fall short in its ability to explain changes after independence. The micro-level approach better explains changes in state capacity
across developing countries after independence, but its use of the prisoners'
dilemma as an analogy for the structure of incentives and opportunities faced
by politicians and their potential supporters is problematic because it
assumes symmetric power and resources between politicians and their
potential supporters.
An alternative analogy for the structure of incentives and opportunities
faced by politicians is a principal±agent model which shows that unless
competition to in¯uence policy is largely con®ned to a single continuum,
politicians will not have the incentive or `political will' to adopt bureaucratic
reform. Examining the validity of this model through the experience of the
Philippines in the period 1946±72 found evidence consistent with expectations of the model.
In conclusion, I would like to highlight an implication of this study that is
potentially relevant for developing countries currently undergoing democratization. The principal±agent framework used in this study argues that state
capacity is not a function solely of insulating the state from societal forces,
but rather of clarifying lines of authority and accountability in the hierarchy
of principal±agent relationships between society, politicians and bureaucrats.
Strong states are those with bureaucrats who are insulated from direct
societal pressure but who are indirectly subject to societal pressure through
politicians. The problem for societal forces Ð the ultimate principals Ð is
772
Gabriella R. Montinola
ensuring that it is in politicians' interests to adopt laws and practices that
create competent bureaucracies. This article has shown that this task is more
likely to be accomplished if voters' demands over various issues align largely
along a single dimension.
ACKNOWLEDGEMENTS
The author gratefully acknowledges David Denoon, John Ferejohn, Kathryn Firmin-Sellers,
M. Steven Fish, Geo€rey Garrett, Robert Jackman, David Kang, Margaret Levi, Andrew
McIntyre, Robert Packenham, Barry Weingast and an anonymous reader for their comments on
various versions of the arguments presented in this article. The work was supported in part by a
grant from the Institute for the Study of World Politics (ISWP). Views expressed in this paper
are those of the author and not necessarily those of ISWP.
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Gabriella R. Montinola is assistant professor of Political Science at the
University of California, Davis (Davis, CA 95616, USA). Her current
research interests include economic development, interest representation and
the causes and consequences of political corruption. She is the author or coauthor of articles in World Politics, Journal of Democracy, Crime Law and
Social Change, and Asian Journal of Political Science.