The absence of social capital and the failure of the Ghanian neoliberal mental model

Abstract

In the 1980s, Ghana sought to institute market liberalization reforms based on policy prescriptions outlined by the IMF (International Monetary Fund) and the World Bank known as Structural Adjustment Programs (SAPs). SAPs were designed in accordance with a neoliberal framework known as the Washington Consensus (WC). The WC, a strand of the neoliberal shared mental model that was first coined by John Williamson, articulated a set of market-oriented policy prescriptions and goals that if pursued faithfully, would help encourage countries on the path to greater economic performance and prosperity. Such prescriptions included instructing governments to pursue policies and strategies aimed at promoting fiscal discipline, interest rate liberalization, privatization, deregulation of entrance and exit barriers, and establishing transparent and public-seeking institutions that are established to enforce and abide by a rule of law that would secure property rights and discourage predatory rent-seeking practices.