An institutional approach to analysis of state capacity in housing systemsin the developing world: Case studies in South Africa and Costa Rica

Mutually balanced roles and activities within state, market and society are needed to underpin effective and equitable housing systems. How these deve lop and interact necessitates negotiation, which in itself requires certain basic structures to be in place and certain capacities to be available. In the developing world this is often not the case, leading to theories based on the limitations of the command economy, market failure, or promoting st ate-market partnerships. While it draws on a political economy analytical f ramework, the paper is grounded in the application of new institutionalism to the study of housing systems, which it argues provides a more relevant t heoretical framework for housing system analysis than previous structural a nalyses. The paper focuses on the constraints that state capacity can have on state-society relationships within the broader context of negotiations b etween the state, the market and society on housing policy and delivery iss ues. The empirical experience of state capacity vis-a-vis housing policy de velopment and delivery is investigated in South Africa and Costa Rica, whic h, despite being very different in many respects, display a number of strik ing similarities in the analysis.