What is co-ordination?
When people agree to behave in a particular way in relation to the allocation, use, and exchange of assets, goods, and services, they are in a sense co-operating in co-ordination - they are co-operating by following a set of rules that define people's respective roles and leads to some degree of co-ordinated behaviour. The rules may be written or unwritten ones, explicitly stated or implied by convention and social norms.
Thus, as part of joint livelihood strategies individuals may co-ordinate their activities and resources with those of other household members or with other members of their village or community. At the other end of the scale different nations (or at least the governments that represent them) may co-ordinate their efforts to achieve national and international goals. Bear in mind that co-ordination is not synonymous with co-operation. It can, for example, take place via competitive markets, although market co-ordination still requires people to co-operate in following the rules of market exchange.
The effectiveness of co-ordination in achieving a specific goal depends upon (a) the extent to which decision-makers and actors comply with the co-ordination rules, (b) the appropriateness of the co-ordination rules to the particular co-ordination task or goal, and (c) the quality of the information available to decision-makers and actors in making decisions within the co-ordinating rules.
'Effectiveness' implies some comparison of actual outcomes against desirable outcomes, and of course what is considered desirable will vary between actors. Thus whilst co-ordination, is a necessary condition for economic development to take place, it is not a sufficient condition - co-ordination can serve to maximise the welfare of a few at the expense of the many. The form that co-ordination takes and the rules that govern it are therefore critically important in determining whether or not co-ordination achieves broad-based sustainable development.
Voluntary or coerced?
Co-operation may be a fairly democratic process involving co-ordinated activity amongst relative equals who voluntarily work together to achieve common objectives. But often it is a top-down process in which people lower down the hierarchy have little voice in the matter and are forced to co-operate with rules determined higher up.
This can still lead to the co-ordination of resources, but unless decision-makers can be held accountable by those lower down, there is a risk that co-ordination will serve the purposes of an elite rather than the goals of broad-based development.
Top down systems also tend to suffer from weaknesses in information as the decision-makers at the top of the hierarchy may have poor information about real conditions, constraints, and opportunities lower down the hierarchy where actors are implementing or are directly affected by decisions.
In the economics literature voluntary co-operation by a group of people to achieve a common goal is often known as collective action. It is typically used to distinguish itself from the co-ordination that is achieved via the market place or through state intervention. Note, however, that the very existence of the state is sometimes thought of as collective action on a grand scale. We shall be discussing these different forms of co-ordination later on in this section.
Deliberative or evolving
Co-operation and co-ordination may be a deliberative process in which the rules governing assets or exchange are consciously designed to achieve a given purpose. In reality, though, rules often develop and change through an evolutionary process as they are inherited or passed down from one generation to the next or from one situation to another, while all the time evolving with only limited and 'path dependent' changes taking place during this process. This is especially the case with informal rules based upon custom and tradition. Tradition perpetuates existing forms of co-ordination, whatever these may be; but, although the rules it protects help co-ordinate the use of resources, they don't necessarily lead to broad-based development: they tend to perpetuate the interests of existing elites, and to evolve in ways that serve the interests of these elites.