Paper short abstract:

This paper reviews two cases of institutional change; Nepal’s transition to federalism and the outlawing of gold mining in El Salvador. Both cases show how institutional change requires analysis of cultural as well as political and economic sources of power and of ideas as well as interests.

Paper long abstract:

The rules that govern how we distribute resources, protect rights, and confer respect are important for development outcomes. This paper reviews two cases of significant institutional change. One is the transition to federalism and inclusion of reservations in Nepal’s 2015 Constitution and the other concerns the 2017 outlawing of gold mining in El Salvador. The paper demonstrates how an analysis of the causal process in each case requires attention to cultural as well as political and economic sources of power and to ideas as well as material interests.

Drawing on insights from political settlements analysis, discursive institutionalism and cultural political economy, this paper presents and demonstrates a cultural political economy approach to institutional change. The paper argues, as per political settlements analysis, that institutions and their outcomes are shaped and transformed by societal power relations. However, contra political settlements analysis, the paper argues that actors’ power must be understood as ideational as well as material, drawn from cultural as well as political and economic sources. Applying a cultural political economy analysis of power to the two case studies, this paper shows how shifts in the way resources are governed and rights protected are not a reflection of material and political interests and power alone. Instead, each case shows how identities form around shared beliefs as well as interests and actors collaborate to claim rights and respect, not just to seize control of resources.