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Governance

Informal institutions

J. Banning / Panos Pictures

Are customary institutions or informal institutions, as they are known, detrimental to the development process? Do these institutions have any relevance in the modern society? Do they matter for development at all and how? What is the relationship between the formal and informal institutional set-up? This key issue guide addresses these questions. It discusses the prevalance of informal institutions in many developing countries and examines their role in development and the associated challenges. The author notes that formal institutions alone do not shape human behavior, but that much of what goes on can be better understood by a closer examination of informal institutions that are grounded in and emanate from a society’s culture.

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