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Seeing institutions in different ways
Seeing institutions in different ways

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1.7 Looking at BancoSol through a different lens

I suggested that Otero was using an ‘institutional development as intervention’ lens when looking at BancoSol’s history. I want to conclude my account of BancoSol by briefly looking through the other, ‘institutional development as history’, lens.

Otero provides a story of action from the point of view of the activist. What we don’t get is a proper sense of the context in which that action was taken, the history it becomes part of. The ‘history’ lens enables us to do this. The following brief extract from a paper on the development of micro-finance illustrates what I mean:

The Bolivian intervention [BancoSol] displays: brilliant dedicated individuals, country-specific economic, social and intellectual conditions, and the constant pressure of international thought and fashion. ... In the mid 1980s Bolivian economics and politics were changing quickly. A failing socialist regime was giving up its ownership of industry and liberalising the economy. This brought, on the one hand, a welcome end to hyperinflation and on the other massive unemployment ... A wave of unemployed people flooded into the towns looking for employment, but, not finding it, settled for self-employment, causing a ballooning of the informal sector. The streets of La Paz and other towns were packed with street vendors and small-scale producers, all hungry for capital.

The micro-credit idea had already reached Bolivia in various ways, including the influence of expatriate Bolivians living in the United States and, crucially, through American ODA (USAID), which had already carried out several micro-credit experiments in Bolivia.

(Rutherford, 2003, p. 5)

It doesn’t take away from the brilliance of the ‘dedicated individuals’ to recognise that they were operating within a historical context which provided opportunities which they were able to exploit. Nor, of course, does it detract from the significance of their breaking of the rules of Bolivian banking.