Imagination and Development : The Salience of Social Values, Entrepreneurship and Cooperation

Rational behaviour is required for markets to function efficiently; but myopic rational behaviour could work against pro-social choice, limit creativity, and minimise the extent of cooperative action. This tension is a serious drawback of the recent promotion of markets in developing countries because economic development will only occur if some significant set of individuals have coherent preferences for the enhancement of relevant social or public values (a social vision); the capacity for and commitment to invention, innovation and entrepreneurship (an entrepreneurial social ethic); and a willingness to act cooperatively and voluntarily in dealing with non-market issues (a cooperative social ethic). In other words, social vision and an entrepreneurial and cooperative social ethic are sufficient conditions, while investment, freedom, appropriate formal and informal institutions, are necessary for economic development. These sufficient conditions for development are themselves enshrined in a country’s ‘collective imagination,’ which constitutes the somewhat neglected demand-preference dimension of development. The paper’s main contribution is its argument that education, culture and religion, which are the things that create, mediate and transmit a society’s shared values across people and over time, fundamentally affect economic performance; and they do so through their effects on people’s capacity to imagine a better, more developed, and more life enhancing socio-economic space