The retention of highly skilled returnees in Mozambique

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The retention of highly skilled returnees in Mozambique an institutional approach
Correa d’Almeida, Andre Monteiro Fernandes
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xx, 256 leaves : ; 28 cm


Subjects / Keywords:
Since 1975 ( fast )
Return migrants -- Mozambique ( lcsh )
Skilled labor -- Mozambique ( lcsh )
Economic history ( fast )
Return migrants ( fast )
Skilled labor ( fast )
Economic conditions -- Mozambique -- 1975- ( lcsh )
Mozambique ( fast )
bibliography ( marcgt )
theses ( marcgt )
non-fiction ( marcgt )


Includes bibliographical references (leaves 241-256).
General Note:
School of Public Affairs
Statement of Responsibility:
by André Monteiro Fernandes d'Almeida.

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Source Institution:
|University of Colorado Denver
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Auraria Library
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Resource Identifier:
707467234 ( OCLC )
LD1193.P86 2010d D34 ( lcc )

Full Text
f I
Andre Monteiro Fernandes Correa dAlmeida
Licenciatura, New University of Lisbon, Portugal, 1995
M.S., Inter-University Institute of Macau, China, 1999
A thesis submitted to the
University of Colorado Denver
in partial fulfillment
of the requirements for the degree of
Doctor of Philosophy
Public Affairs

2010 by Andre Correa dAlmeida
All rights reserved.

This thesis for the Doctor of Philosophy
degree by
Andre Monteiro Fernandes Correa dAlmeida
has been approved
Peter deLeon
Paul Teske
Peter Van Arsdale

Correa dAlmeida, Andre M.F. (Ph.D, Public Affairs)
The Retention of Highly Skilled Returnees in Mozambique: An Institutional
Thesis directed by Professor Peter deLeon
This thesis combines Institutional Rational Choice (IRC), the Institutional
Analysis and Development (IAD) framework, Return Migration theories and
International Development theories to understand how Mozambican highly skilled
returnees (HSRs) interact with the institutional setting in the home country while
pursuing their personal aspirations. Institutional setting in this context is defined as a
multidimensional space of factors institutions plus other contextual variables co-
evolving as they interact with each other in which HSRs try to mobilize resources
over time towards their personal goals. Factors impose elements of order in the
context where they operate and they affect the distribution of preferences, incentives,
and outcomes. A better understanding of the constraints imposed by these
factors/elements on HSRs behavior and personal satisfaction could allow
governments in extremely poor countries to prioritize interventions for institutional
development given the very scarce resources available. These could have the
interacting effect of increasing the capacity of HSRs to contribute to the development
of Mozambique and provide positive signals to encourage the return of more.
Hypotheses around three specific types of factors/domains professional
opportunities, information and communication technologies (ICTs), and
governmental programs are tested. The methodology applied includes (i) a cross-
sectional purposive sample of Mozambicans who recently returned to the home
country after obtaining post-secondary education abroad; (ii) an online survey
complemented with field interviews; (iii) bivariate analysis; and (iv) multivariate
model-building. The results demonstrate, first, that all three factors tested are
associated with retention. This finding supports the IADs argument that new policies
and institutions can be devised to shape those other contextual variables. Second, this
research demonstrates that the degree of this association differs across factors. Third,
this research shows that the degree of association also differs from urban to rural
settings. Moreover, the first and foremost role played by professional-related
elements in the capacity of a country to retain some of its most well-educated citizens

supports previous literature. Next, this research supports the argument that
institutional development precedes economic development. Also, this thesis does not
find empirical support for the hypothesis that Mozambique has been facing increasing
levels of the brain drain. In addition, the Satisfaction With Life Scale (SWLS)
proxy for retention is among all proxies tested the one mostly associated with the
institutional setting in the home country. More specifically, the possibility of
achieving personal goals is the most important component of ones overall life
satisfaction. Finally, there is a temporal ripple-effect on the association (i.e.,
progressively weaker) of the current institutional setting both with past and with the
possibility of future behavior. The implications resulting from these findings are
discussed and classified into three categories: (i) theoretical; (ii) practical for policy;
and (iii) and for future research.
This abstract accurately represents the content of the candidates thesis. I recommend
its publication.
Peter deLeon

To Mae, Pai, and Sara

During my undergrad studies I never really considered pursuing a higher
academic degree such as a Masters, let alone a PhD. However, at some point of my
life when I was completely immersed in community and charity activities and
probably neglecting my studies, my Father said: If you really want to help others and
make a difference in their lives, you better start with helping yourself and focus on
your education.
There are many people and organizations that contributed towards this scientific
journey; those who accompanied me, inspired me, and were my supporters.
Following are a few of the individuals and groups that I would like to acknowledge
and thank.
Without the grant obtained from the Foundation for Science and Technology
(FCT) of the Portuguese Government I would not have been able to enjoy the
material comfort needed to allow my body and mind to focus on my doctoral studies.
Moreover, this thesis would never have existed without the tireless and continuing
support obtained from my Research Committee, in particular from my Chair, Dr.
Peter deLeon, and from my professor Dr. Christine Martell. It is important to
emphasize how impressive Dr. deLeons time, patience, and dedication in the
multiple revisions of my drafts was for me.
My personal road towards a doctoral degree started to find inspiration in Macau,
China, almost 15 years ago with Dr. Luis Valadares Tavares and Dr. Joao Louren^o,
who introduced me to the academic world. After the year 2000, while back in Lisbon,
I obtained further support and extraordinary guidance from Dr. Roberto Cameiro and
Dr. Joao Cesar das Neves. While it was through Dr. Stephen Block, whom I met in
Lisbon in the spring of 2005, that I first learned about the School of Public Affairs in
Denver (SPA), it was Dr. Paul Teske who selected me for the program. Dr. Paul
Teske, currently the Dean of SPA, has since been a major advisor for my professional
career and Dr. Stephen Block was a key element for the grant I obtained from the
Portuguese Government. Thanks to Dr. Peggy Cucity from SPA and my very good
friend Marta Cabral I was able to design the survey tools used for this thesis.
Upon arriving in Denver on January 13, 2006 with no place to stay, it was my
good fellow scout-leader, Dr. David Eckhardt MD, whom I had met in London the
previous summer, who accommodated me the first few weeks. Through him I had the
enormous privilege to meet and enjoy the company of his wonderful family, his father
John Eckhardt in particular, on so many great occasions. For some time the Eckhardts
were my adopted Denver family.
Dr. Katrina Miller-Stevens, Jonathan Pierce, and Lisa McCann were not only
amazing and very supportive friends and classmates but also provided valuable
logistic support on the many trips I made to Denver to work with my research

committee. Cheryl Kaas, who became a very close friend, was also incredible in her
generosity making me feel at home in my last few trips to Denver. Also, I was
extremely fortunate to have Cheryl helping me both with the rehearsals for the final
defense and with the final copyediting of the entire manuscript. In addition, during
my research assistantship at the Center of Education Policy Analysis (CEPA) at SPA,
Dr. Robert Reichardt and Dr. Beverly Buck provided a very important intellectual
stimulus for my research work. Of special note is Dr. Donald Klingner, who guided
me towards the publication of my first scientific paper in the United States. To Dawn
Savage (Student Services Team) and Rob Drouillard (IT Coordinator) I am deeply
thankful for making my whole experience at SPA much easier and more enjoyable.
The present thesis has profited enormously from many other people in other parts
of the world. From Firenze, Italy, Dr. Jean-Pierre Cassarino of the European
University Institute provided very important references to assist on the theoretical
framing of my research. From Pittsburgh, Dr. Ill-Chull Moon and Geoge Davis of the
Carnegie Mellon University dedicated a very considerable amount of time
introducing me to computational modeling of social dynamics. From Washington DC,
Dr. Liesl Riddle and Dr. Jennifer Brinkerhoff of George Washington University
provided a very strong incentive to continue pursuing research on highly skilled
retumees-related topics. In Boston, the Kennedy School of Government gave me the
unique opportunity to present my preliminary results to an outstanding panel of
political scientists. In New York City, I am thankful to Columbia University for
allowing my participation in an agent-based modeling course that complemented the
previous learning experience on dynamic social structures in Carnegie Mellon.
My two months of field research experience in Mozambique were unique, not
only from an academic perspective but also as an inner journey. In Maputo, Andre
Nogueira and Isabel Neto provided all the logistics I needed (you name it!). Through
the guidance of Isabel Ramos I was able to navigate within the local institutional
setting. Without the collaboration of the Center for African Studies at Eduardo
Mondlane University it would not have been possible to access the work and research
of some very important Mozambican authors. In Beira, Father Francisco Ponsi, the
Vice-Rector of the Catholic University of Mozambique, who I had been
communicating with by email for the last two years, provided all the necessary
logistics and introduced my research to the Ministry of Education. In the sequence,
Dr. Octavio de Jesus from the Mozambican Institute of Scholarships (IBE) was
appointed by the Ministry of Education as the contact point for my research. Dr. Jesus
was very helpful for building my study sample. Several other organizations, including
Mozambican embassies worldwide and the Portuguese Institute for Development
(IPAD), provided valuable contributions to reach out to Mozambicans studying
abroad. Also in Beira, Father Lucas, who happened to know my brother Bernardo (a
Franciscan priest) very well, proved to be a wonderful friend and social support. In
Nampula, Amisse, the 30 ton sugar truck driver that drove me for 36 hours from
Beira, started by being a service provider the ride to very soon becoming in charge
of my personal security. At some point, I started to look at him as a good companion.
Upon arrival to Nampula, after a thousand miles on the road, he was more a friend,
and when I realized that I had no place to sleep for Christmas Eve, he became my
host and my Muslim brother. He was my star of Bethlehem. I knew that I was going

to meet Nuno Lopes in Nampula, but I did not anticipate that he was going to be one
more star in this African journey. Coincidently, Nuno was leaving the city the exact
same day that I had arrived. All of a sudden, I had a five-star hotel room just for me.
When he got back in town he continued to share it with me. However, more than a
logistic support, Nuno, whom I had known since my adolescence, symbolized all
those in the world that I love the most and that I carried in my mind and heart
throughout my African journey... I had already been collecting a constellation of
stars since I landed in Maputo on my birthdays eve November 24th. Without the
collaboration of Manuel Pires, a Portuguese armed-forces retiree, Auduro, a Muslim
entrepreneur, Sami Gadalle, a religious Muslim leader, and Americo Sardinha, a
World Wide Foundation executive, I would not have been able to collect all the
information I needed in the north of the country. Thanks to Hotel Girassol I was
always able to access the internet when the hotel 1 was lodged in could not provide it.
In Cuamba, a rural settlement towards the border with Malawi, I benefited
enormously from the logistic support of the Agriculture Studies Campus at the
Catholic University of Mozambique. Once again, Father Ponsi was invaluable.
Once back in NYC, and now with the main goal of analyzing all data collected,
Nuno Antonio, my old friend, provided valuable scientific guidance and draft revision
in the statistical analysis. I have to thank the U.S. office of the firm he represents -
STATISTICA for sponsoring the software license used in my data analysis. Dr. Jody
Fitzpatrick and Dr. Joao Lopes Dias also provided valuable contributions towards the
end of preparation of the final version of this manuscript.
Last but most important, Helena Albuquerque and Dr. David Fenyo, who have
been the safety net of my life-trapeze since in the fall of 2005 when I landed on the
other side of the Atlantic Ocean.
And for you, my beloved Sara!

Acronyms List.........................................................xvi
CHAPTER 1: THE PROBLEM....................................................1
Research Focus and Question.............................................6
Research Relevance......................................................8
Overview of Thesis.....................................................12
CHAPTER 2: THE CASE OF MOZAMBIQUE........................................14
A Multidisciplinary Overview...........................................14
Traits of a Mozambican Identity........................................26
CHAPTER 3: LITERATURE REVIEW.............................................32
New Institutionalism...................................................33
New Institutionalism, Institutions, and Institutional Rational Choice.33
New Institutional Perspectives on Development.........................38
Institutional Creation, Role, and Change in Institutional Rational Choice ...47
Breaking Down the Institutional Setting................................50
Institutional Analysis and Development, Contextual Factors, and
the Action Arena....................................................51
Return Migration Theories and Community Attributes....................55
International Development Theories and Biophysical/Material Conditions.. 65
Government, Institutions, and Rules in Place......................... 70
Urban Bias, Rural Development, and Contextual Factors................ 76
CHAPTER 4: METHODOLOGY...................................................81
General Purpose........................................................81
Population and Sample..................................................83
Study Extended Sample and Study Sample.................................84
Research Tools, Data Collection, and Variables.........................86
Dependent Variables...................................................91
Independent Variables.................................................95
Measurement Validity, Reliability, Accuracy, and Error.................98
CHAPTER 5: DATA ANALYSIS................................................103

Gender, Age, Marriage, Spouse, and Fertility Rates........104
Ethnic and Religious Affiliation..........................105
Political Affiliation.....................................106
Reasons to Leave Mozambique...............................107
Foreign Destinations......................................108
Degree Preferences........................................109
Professional Training and Skills..........................Ill
The Return................................................112
Reasons not to remain abroad..............................118
Reasons to remain abroad..................................118
Reasons preventing from remaining abroad..................119
Personal goals............................................122
Geographic Mobility.......................................124
The Independent Variables...................................126
The Institutional Setting and Contextual Factors..........126
Three Specific Contextual Elements........................139
The Dependent Variables.....................................156
Exploratory and Hierarchical Analysis.......................161
Professional Opportunities and Retention..................162
ICTs and Retention........................................166
Governmental Programs and Retention.......................170
Urban vs. Rural..........................................171
Multivariate Analysis.......................................176
Major Findings..............................................195
Theoretical Implications....................................196
Policy Recommendations......................................204
Future Research.............................................212
Closing Notes...............................................216
POLICY EXAMPLES...........................................218

Fig. la: Political Map of Africa...........................................15
Fig. lb: Mozambiques HDI..................................................15
Fig. 2: Mobil Communications Network Coverage in Mozambique...........79
Fig. 3: Map of Field Research..............................................82
Fig. 4: Social Connectivity in Sample Construction.........................85
Fig. 5: HSRs Migratory Cycles Time Line..................................95
Fig. 6: HSRs Mental Models of Association between Returning Factors......116
Fig. 7: HSRs Mental Models of Association between Personal Goals........123
Fig. 8a: Africas Connectivity with Global Networks.......................153
Fig. 8b: The Telecommunications Backbone of Mozambique....................153
Fig. 9: Eastern Africa Submarine Cable System.............................209
Fig. 10: HSMs Social Connectivity........................................213

Table 1: Population of Mozambique and Incidence of Extreme Poverty
by Province...........................................................16
Table 2: Theories of Return Migration..........................................57
Table 3: Urban vs. Rural Infrastructures in Mozambique.........................79
Table 4: Hypothesis 1 (Hi).....................................................96
Table 5: Hypothesis 2 (H2).....................................................97
Table 6: Hypothesis 3 (H3).....................................................97
Table 7: HSMs Fields of Study Abroad.........................................110
Table 8: HSMs Areas of Professional Experience Abroad.......................111
Table 9: HSMs Areas of Specific Training Abroad.............................112
Table 10: HSRs main reasons for returning to Mozambique......................113
Table 11: HSRs main reasons not to remain abroad.............................118
Table 12: HSMs main reasons to remain abroad................................119
Table 13: HSRs main reasons preventing them from remaining abroad............120
Table 14: HSMs main reasons not to return....................................121
Table 15: HSRs Geographic Mobility...........................................125
Table 16: Perceptions of Conditions in Mozambique.............................136
Table 17: HSRs Job Fields....................................................140
Table 18: ICTs Market Opportunities..........................................149
Table 19: Correlations between Professional Opportunities and Satisfaction
with the Circumstances of the Return................................163
Table 20: Correlations between Professional Opportunities and current Overall
Personal Life Satisfaction in Mozambique.............................164
Table 21: Correlations between Professional Opportunities and the Possibility
of Fulfilling Personal Goals in Mozambique..........................164
Table 22: Correlations between Professional Opportunities and Ones
Perceptions of His/Her Contribution for the Community...............165
Table 23: Correlations between Professional Opportunities and Perceptions
of Others Recognition of Ones Contribution for the Community......165
Table 24: Correlation between Professional Opportunities and the Probability
of Leaving Mozambique Again..........................................165
Table 25: Correlations between Overall Satisfaction with ICTs and Proxies for
Retention at Different Points in Time of the Migratory Cycle.........166
Table 26: Correlations between Overall Satisfaction with ICTs and Aspects of
Community Involvement................................................168
Table 27: Correlation between an ICT and the Probability of Leaving
Mozambique Again.....................................................170

Table 28: Correlations between Governmental Programs for HSMs and
Proxies for Retention.................................................170
Table 29: Hypotheses (Hi to H3), Dependent and Statistically Significant
Independent Variables.................................................177
Table 30: Model-building for Hypothesis 1 (Hi)...............................180
Table 31: Model-building for Hypothesis 2 (H2)...............................181
Table 32: Model-building for Hypothesis 3 (H3)...............................182
Table 33: Overall Structural-effect of Institutions on Retention...............185
Table 34: A Theoretically Complete Model......................................190

Charts la to lc: Institutional Setting and Contextual Factors overall impact....127
Chart 2: Institutional Setting relative impact...................................129
Chart 3: Institutional Setting overall quality...................................130
Charts 4a to 4c: Institutional Setting and Contextual Factors overall impact....132
Chart 5: Institutional Setting relative impact..................................133
Chart 6: Institutional Setting overall quality...................................133
Chart 7: Institutional Setting dynamics and change...............................134
Chart 8: HSRs Perceptions of Conditions in Mozambique.............................137
Chart 9: HSRs Expectations about their Future Professional Fulfillment...........145
Chart 10: HSRs ICTs Usage Intensity...............................................147
Chart 11: Selected ICTs Penetration Rates for Mozambique.........................152
Chart 12: Relevance of Programs for HSMs Decision to return.......................155
Chart 13: Items of HSRs Life Satisfaction in Mozambique and Variability
within SWLS..............................................................158
Chart 14: HSRs Overall Life Satisfaction in Mozambique............................159
Chart 15: HSRs Life Satisfaction Gaps.............................................160
Chart 16: Items of HSRs Satisfaction with the Degree of Recognition in
Chart 17: The Mediating Effect of Geographic Location: the Maputo effect........167
Chart 18: The Mediating Effect of the Maputo bias................................173
Chart 19a to 19c: Maputo bias......................................................174
Chart 20: Structural-effect, HSRs Migratory Cycle, and Retention:
theRipple effect.......................................................186
Chart 21a to 21 e: Normal Probability Plot of Residuals............................188

ADB AfDB CDF CIA CPR DV EASSy EU FDC FDI FRELIMO GDP HDI HSM HSR IAD IBE ICT IDB IFC IMF IOM IRC ISP IV MANU MDG MIDA MiReM NGO NI NRI OLS PARPA PC Ph.D. PPP PRSP Asian Development Bank African Development Bank Comprehensive Development Framework Central Intelligence Agency Common Pool Resources Dependent Variable Eastern Africa Submarine Cable System European Union Fundaqao para o Desenvolvimento da Comunidade Foreign Direct Investment Frente de Libertazao de ogambique Gross Domestic Product Human Development Index Highly Skilled Mozambican Highly Skilled Returnee Institutional Analysis and Development Institute de Bolsas de Mozambique Information and Communication Technology Inter-American Development Bank International Finance Corporation International Monetary Fund International Organization for Migrations Institutional Rational Choice Internet Service Provider Independent Variable Mozambican African National Union Millennium Development Goal Migration and Development for Africa Migration de Retour au Maghreb Projet Non-Governmental Organization New Institutionalism Networked Readiness Index Ordinary Least Squares Plano de Aczao para Reduzao da Pobreza Absoluta Personal Computer Philosophiae Doctor Power Purchase Parity Poverty Reduction Strategy Paper

RENAMO RQAN RQNLA SANSA SMEs SUR SWLS TDM TOKTEN TV UDENAMO U.K. UNAMI U.S. UCD UN UNDP WB Resistencia Nacional Mogambicana Return of Qualified African Nationals Reintegration of Qualified Nationals of Latin American South African Network of Skills Abroad Small and Medium Enterprises Seemingly Unrelated Regression Satisfaction With Life Scale Telecomunica9oes de Mo9ambique Transfer Of Knowledge Through Expatriate Nationals Television Uniao Democratica Nacional de Mo9ambique United Kingdom Uniao Africana de Mo9ambique Independente United States University of Colorado Denver United Nations United Nations Development Program World Bank

Upon reflection, I am also a highly skilled citizen according to the definition used
in this thesis. Contrary to the highly skilled returnees (HSRs) surveyed, however, I
am still living outside my home country Portugal. Three times I have left Portugal for
a long period, and two times I returned. The first time I left Portugal was to conclude
my degree in economics and the destination was The Netherlands. I was definitely
encouraged by some family members with international experience, but I never really
thought of remaining abroad since my plan was to initiate my professional life in
Portugal. The scholarship, funded by the European Unions students exchange
program ERASMUS had been spent, my personal goals accomplished, and I valued
the company of my eight siblings, parents, and friends. Six months after leaving for
abroad, I was back.
One year and a half after returning from The Netherlands I left Portugal for the
second time for professional reasons, and the destination was Macau, China. After
more than three years in Macau I accomplished my purpose and, in spite of several
invitations to remain in China, I returned to Portugal again. Now, holding a Masters
degree, I wanted to start teaching in my home country and apply my international
experience to national projects. Financial conditions were not the motivation. I had
my savings from my experience in China and returned without any professional
contract signed, but I was highly motivated to look for something more relevant in

my own country. To some extent I was already feeling the need for personal
recognition from my community. I stayed almost six years in Portugal before
emigrating again. While during this period 1 felt highly recognized by those inviting
me for a wide diversity of academic, management, and artistic projects, at some point
I felt the need to disrupt the incremental unfolding of my career and my life. Even
with several challenging projects in hand life had become too comfortable and
predictable. As it had happened when deciding to return from China, I needed a
renewed big-push transformation in my life. I needed to empty my mind, to go back
to the basics of existence, to get ride of the superfluous and to disentangle from my
comfort zones in order to be able to reinvent myself.
The third time I left Portugal was for academic reasons, and the destination
chosen was the U.S., where I have been for the last five years. With the completion of
my Doctoral degree I do not plan to return in the near future. While professional
opportunities and access to resources in the U.S. are unique, what motivates me the
most to remain in this country is the possibility of continuing enriching and investing
in my professional and life experience, in particular within the context of major
global organizations. Most likely, I will return to Portugal one day to play a very
active role and to make a difference in the development of political institutions. On
one hand, I want to do it regardless financial conditions offered in Portugal; on the
other, I need to feel that the people of my country recognize my value and merit. I
acknowledge that as a highly skilled Portuguese it is also up to me to create the
conditions needed for my return. It is like a co-evolving interaction between the
institutional setting in my home country and my own initiative to search for a relevant

place in it. Am I brain drain? Maybe, a circulating brain looking for recognition and a
sense of belonging in multi-spaces...

The ultimate explanatory variable of development is the education level of
communities and nations (Fukuyama 1992; Huntington 1993). More specifically,
Fukuyama (1992) argues that knowledge is the key to the directionality of history
(ibid., p. 72). This is so because science regulates the direction of economic
development by establishing a constantly changing horizon of production
possibilities (ibid., p. 77). Moreover, closely intertwined with this expansion of the
technological horizon is an increasingly rational organization of labor favored by an
adequate supply of skilled labor (ibid.).
As part of their continuing struggle with persistent, pervasive poverty, African
countries have systematically been facing rates of emigration of well-educated
citizens increasingly larger than the corresponding rates of immigration (Carrington
and Detragiache 1998; Docquier and Marfouk 2004). This condition has been
characterized as the brain drain phenomenon. Some 130 million people worldwide
are living outside the country of their birth, and in the context of globalization the
number of migrants is generally presumed to be growing (Black et al. 2003, 5). The
authors also estimate that 30 percent of the most highly educated African nationals,
defined as possessing a post-secondary education, live outside their countries of

Although extreme poverty fell globally from 1.5 billion persons in 1981 to 1.1
billion in 2001, sub-Saharan Africa was not part of this positive development (Chen
and Ravallion 2004). This region was the only one facing a dramatic increase it
doubled and is currently the home of approximately 30 percent of those 1.1 billion.
The World Bank (WB) defines extreme poverty as living on less than US$1 per
day (PPP).1 In general terms, and within the context of this research, persistent
extreme poverty in Africa refers to situations where successive generations of
families have not succeeded in increasing their living standards above that threshold
in the post-independence period (Carter and Barrett 2006).
Mozambique has been facing increasing levels of the brain drain phenomenon
with disproportionate levels of less educated living in Mozambique. From 1990 to
2000, (i) the percentage of educated emigrants to total population (25 years plus) in
the country quadrupled from 0.04 percent to 0.16 percent; (ii) the percentage of
educated emigrants to total educated population more than doubled from 36.26
percent to 82.24 percent (nearly 45 percent of all university-graduated Mozambicans
live abroad), meaning that Mozambique has been increasingly losing its highly
skilled, educated human resources; and (iii) the percentage of educated emigrants to
total emigrants quintupled from 3.57 percent to 17.73 percent, suggesting that
emigration opportunities were increasingly accruing to the most educated members of 1
1 Power Purchase Parity (PPP) theory suggests co-movements of changes in the
exchange rate with the inflation differential of two countries. The average U.S. citizen
earned $127 (PPP) per day in 2009 (IMF 2009).

society, to the disadvantage of the less educated left at home (Docquier and Marfouk
The basic problem is that the welfare of nation and those left behind could readily
diminish because the social return to migrants education exceeds their private
returns. Moreover, given that education is often partly publicly financed, the brain
drain phenomenon has been recognized to be injurious to most African nations (Beine
et al. 2001).
Countries of origin have to create incentive mechanisms to encourage their most
well-educated and skilled citizens to return and remain in the home country, so they
can more actively participate in its economic-social development. Within this context,
it is important to understand the returnees motivations, behavior, and patterns of
reintegration (Patinkin 1968; Thomas-Hope 1999; Dustmann and Kirchkamp 2002;
Cassarino 2004).3 This process of return and retention of highly skilled citizens was a
fundamental means for the development of some Asian nations in the 1960s, 1970s,
and 1980s, such as Japan, Singapore, Republic of Taiwan, and Republic of Korea
(Iredale and Guo 2001).
Patinkins Nationalist Model of development specifically addresses the
relationship between brain drain and opportunities for scientific activities in the home
country. This authors emphasis in on what the underdeveloped countries can
themselves do to diminish the brain drain (p. 95). This model encompasses three
2 World Bank. Database on Brain Drain at http:
3 The term development here used refers to variations on the United Nations (UN)
Human Development Index (HDI) that measures a countrys average achievements in
three basic dimensions of human development: life expectancy, educational
attainment, and adjusted real income ($PPP per person).

interrelated aspects: (i) the countries must encourage their trained scientific personnel
to identify with the development of the country; (ii) the countries must show that
these people can indeed fulfill a vital role in that development; and (iii) the countries
must provide at least minimally for them to fulfill their scientific aspirations.
Algerian President Abdelaziz Bouteflika puts it this way: We have to find a way
to reduce our brain drain! This is an open wound contaminating the whole nation.
The highly educated and skilled are the very ones that Third World countries can
least afford to lose (Todaro 1985, 123). Referring to diasporas and returnees
initiatives, Riddle and Nielsen (2008, 23) observe countries of origin should identify
the key obstacles investors face.
Rodrik and Wacziarg (2005) addressed the potential role of returnees to improve a
countrys capacity to induce change and foster development. In their words, the
returnees would also bring home far more benefits than their wage alone: experience,
entrepreneurship, funds to invest, and an increased work ethic (p. 151). However, to
make sure these benefits are realized, states must generate incentives for the workers
to return and stay (Brown 2000).
Rodrik (1996) examined the clear success of Republic of Korea and Peoples
Republic of China in the second half of the 20th century, in particular how the sharp
increases in physical and human capital as well as in labor-force participation account
for virtually all the rise in output (p. 13). Further, Cerase (1974, 259) argued more
than 30 years ago that the returnees will, his means, and his belief are new and,
strictly speaking, innovative. The returnee aims to disrupt the old equilibrium in the
local power structures (ibid., p. 258). Iredale and Guo (2001, 1) agree, albeit on a

more diffuse national context: A study on the return migration of Yemenis from
Saudi Arabia found that upon their return, many people invested in small business
such as convenience stores, but there was no analysis of the processes or of the
interaction between the returning migrants and the society at large. They call for
study of the interaction of personal networks with contextual factors and they write,
there has been little work on impacts of highly skilled returnees (ibid.). Harvey
(2009, 2) concurs, there has been a disappointing level of analysis of highly skilled
migrants returning to their home countries.
The highly skilled returnee (HSR) interacts with the context at home because s/he
is motivated to pursue personal goals that guided the return (Iredale and Guo 2001;
Doreian 2006).4 These personal goals can be multiple, of any kind (e.g., finding a job,
creating a company, having land, supporting the family), and change over time.
Analyzing the factors shaping highly skilled returnees adaptive inclination (e.g.,
what are the barriers, constraints, difficulties, favoring factors) should shed light on
the reasons for which their patterns of reintegration at home and their capacity to
adaptively invest their skills in the local context differ.
Complementarity, knowing how HSRs interact with the indigenous contextual
structure to pursue their personal aspirations will inform governments about how to
prioritize development policies towards HSRs retention. These could have the
interacting effect of increasing the capacity of HSRs to contribute to the development
of Mozambique and provide positive signals to encourage the return of more.
4 HSRs here used refers to those who have returned from overseas after earning an
advanced degree (i.e., post-secondary education).

Research Focus and Question
The return and retention problem just described emphasizes three critical features.
First, it emphasizes the broad socio-economic, political, and cultural structure which
HSRs are embedded in (i.e., the contextual factors of Africa and, more specifically, of
Mozambique). Second, it emphasizes the HSRs patterns of reintegration through
which personal goals in Mozambique are pursued (i.e., HSRs decisions and behavior
in the home country). Lastly, it emphasizes the relationship that can be established
between contextual factors and behavior. To address these critical features and to
clarify the relevant variables to address them (Schlager 1999), New Institutionalism,
and more specifically, Institutional Rational Choice and the Institutional Analysis and
Development framework, combined with Return Migration theories, and International
Development theories are applied and explored in this thesis to explain and
operationalize the constructs contextual factors and behavior.
The focus of this research is on whether and how the existing contextual structure
offer opportunities and/or impose constraints on HSRs efforts to mobilize resources
towards personal goals associated with their retention. By understanding the intensity
of these hypothetical benefits and/or constraints, governments can prioritize their
scarce resources towards more efficient institutional arrangements (Acemoglu 2006;
Vitorino 2006). To make this contribution possible for policy making, it is assumed
that HSRs behaviors can be studied structurally, that is, in terms of the ways in
which they interact with and respond to indigenous contextual factors upon their
return. Ultimately, then, this research is about HSRs patterns of reintegration and the
contextual factors influencing their decision to remain in Mozambique.

Even though this research takes HSRs return as a given and therefore not being
directly about factors influencing that decision, factors influencing retention (e.g., job
opportunities, education system, dynamic markets) may also encourage more to
return.5 This thesis proposes to address a single research question (RQ), which is
broken down into four hypotheses introduced throughout the literature review:
RQ: What factors affect retention of HSRs in Mozambique?
This research question follows Fernandez and Raineys (2006) recommendation
that, more than studying final outcomes, independently from which were the initial
intentions, the fundamental issue is to know whether an intended outcome (e.g.,
retention) actually occurs and which were the strategies to achieve them (e.g.,
This thesis is not only about factors affecting individual behavior. The problem
this thesis seeks to address can also be framed from a collective action point of view.
Factors common to more than one HSR, either favoring or hindering ones behavior,
can also be viewed as network nodes bridging different interests within the same
action arena.
Even though this research is not, strictly speaking, about institutional change, the
identification of factors affecting behavior and the quantification of their relative
5 Within the context of this research retention does not imply confinement of
HSRs operations to Mozambican geographic boundaries. It implies that HSRs have
their residency in Mozambique but it includes situations of brain sharing (i.e.,
situation in which activities are carried out in and out of Mozambique) (Saxenian

importance, both goals of this thesis, are viewed as signals for policy making
ultimately determining the patterns of institutional development. To the extent that
institutional change can be viewed as a legislative process where demand (i.e., civil
society) and supply (i.e., state) forces interact, the focus of this thesis is on the
demand side only. For instance, in Bangladesh, a female returnee professor initiated a
new gender studies courses for the first time in her campus after she returned from
completing her doctoral degree (Ph.D.) in Australia (Iredale and Guo 2001). This
thesis is not about changes introduced in Mozambique by the HSRs, as this
Bangladeshi Professor did in her home country, but it is about the interaction between
HSRs and conditions found in the home country that will eventually push for and/or
demand change.
Research Relevance
It is relevant from a conceptual point of view to study and bridge persistent
poverty with contextual factors and HSRs. The trend to move from a macroeconomic
to a more micro analysis of social, political, and economic groups and individual
behaviors has been defended by several authors that argue that studying social
structures in discrete settings is a key to understand political and economic change
and development (Granovetter 1973, 1985; Williamson 1985; Ostrom 1990, 2008).
This thesis is also relevant from a theoretical perspective. On one hand, it is a
theory-exploring research viewed through four hypotheses; on the other, it bridges
four different theoretical fields Institutional Rational Choice, Return Migration
Theory, International Development theories, and Happiness Studies with the goal of

explaining which are the factors most likely to affect retention of HSRs.6 According
to Cassarino (2004, 253) the growing diversity of migratory categories ranging
from economic migrants to refugees and asylum seekers necessitates a distinction
between the various types of returnees. This author adds, we still need to know who
returns when, and why; and why some returnees appear as agents of change, in
specific social and institutional circumstances at home, whereas others not"
[emphases added]. Sun (1999) concurs that previous research on returnees has
focused on the process of their return to the origin country, while how they were re-
integrated as active members of society after their return has been assumed to be
problem free.
It is also salient from a policy-making standpoint to study and bridge persistent
poverty with contextual factors and HSRs. The phenomena of technological, social,
political, and economical globalization increases peoples and societies awareness of
events and realities happening globally. On one hand, governments of developing
countries are becoming increasingly exposed to the international community and to
their own people, which raises new issues of political efficiency and accountability.
On the other hand, governments and non-profits from more developed countries face
an increasing pressure from their citizens and stakeholders to improve the efficiency
of their foreign aid policies. For example, Hulme and Shepard (2003, 3) write:
In the last few years national and international commitments to
poverty-reduction have reached levels that could barely have been
imagined ten years ago. Most world leaders have committed their
countries to ambitious targets for reducing global poverty, national
governments are drafting Poverty Reduction Strategy Papers (PRSPs),
6 For an emphasis on multidisciplinary approach to Policy Sciences, see Lasswell

and international agencies are focusing their attention on mobilizing
resources and influencing policies that will provide pro-poor growth
and alleviate poverty.
Contrary to what was the aspiration of the UNs Millennium Development Goals
(MDGs)7 8, extreme poverty will not be eradicated by 2015. Therefore, we ask, on
what terms, and under which principles and guidelines, will the international agenda
on poverty for the period after 2015 be developed? The scholars around the world
continue to learn from a century of research on development and growth, of policy
experimentations, of successful and unsuccessful practices, and of desired and
undesired outcomes (Samuelson 1954; Galbraith 1987; Putnam 1992; Herbst 2000;
Sen 2006). This thesis aims to contribute to this global involvement towards
eradication of extreme poverty and human suffering in sub-Saharan Africa, in
general, and Mozambique, in particular, through the lens of HSRs.
This thesis is the first study ever developed about retention of HSRs in
Mozambique. For the first time, Mozambican policy-makers will have access to a
data-driven relationship with which to inform policies aimed at retaining some of
their nations most well educated citizens. Problems with the Migration de Retour au
Maghreb Projet (MiReM) (2007) in northern African nations are instructive in this
sense. More specifically, in this report on return migration to Algeria, Morocco, and
Tunisia, the statistical sources do not provide a comprehensive, precise vision
regarding the socio-demographic characteristics of the returnees, nor do they allow
the return migration phenomenon and the link between return migration and
7 United Nations Development Program (UNDP) at
8 MiReM Report at lamruaue=en.

development in migrants countries of origin to be properly understood and analyzed.
Moreover, owing to the fragmentary nature of the data, used sources do not
sufficiently inform the reader about return migration in at least two aspects: (i) the
motivations, factors and circumstances that led migrants to return their country of
origin; and (ii) the migrants resources and patterns of reintegration in their country of
origin, as well as their respective impact on the local and domestic economy.
Within the context of development policies, it is particularly relevant to focus on
HSRs. As human capital is viewed as a major factor for development, a positive
change in the stock of this factor should induce further development (Fukuyama
1992; Huntington 1993). Viewing HSRs as a positive flow of human capital back
home, attempts to study this phenomenon should contribute to illuminate certain
development mechanisms. For Huntington, the ultimate explanatory variable for the
democratization wave occurring in the last quarter of the 20th century was the
political entrepreneur emerging from better educated and prepared elites. Referring to
Africa, Guest (2004, 3) writes that it is A continent in need of leadership. For
instance, a survey of elite return migrants to Ghana and Ivory Cost revealed that
being an advocate for community was perceived as the most important type of
change they introduced in their home country after returning (Black et al. 2003).
From a methodological point of view, this thesis melds quantitative and
qualitative research techniques to illuminate results and inform conclusions. From an
empirical perspective, this thesis is the most complete effort to date to create a
database of highly skilled Mozambicans (HSMs) who studied or are still studying
abroad. More than fifteen hundred have been identified.

Summarizing, Ostrom (1999) seems to support research focusing on behavioral
and contextual aspects of highly skilled people when writing, Far more important is
a deep understanding of... the capacity of citizens to learn entrepreneurial and to
undertake important economic and social activities relying primarily on their own
skills (p. xv).
Overview of Thesis
With its problem defined, the correspondent research question formulated, and its
relevance highlighted, the remainder of this thesis is structured as follows. Chapter 2
provides an overview of some of the most relevant current trends describing the
evidentiary base for this research: Mozambique. For this, a multidisciplinary
approach, combining data from fields such as Geography, Demography,
Ethnography, Sociology, Economics and Political Sciences, provides a balanced
understanding of the context in which the elements framed by the research question
evolve and interact (i.e., co-evolve). Chapter 3 introduces and explores the theoretical
framework chosen to illuminate the problem being addressed in this research. The
goal of this chapter is to propose a set of testable hypotheses for theory-testing.
Chapter 4 introduces and describes the methodology used to test the research
hypotheses, and includes a discussion on its validity and limitations. Chapter 5 is
dedicated to data analysis in light of the methodology designed. The ultimate goal of
this chapter is to answer the research question by accepting or rejecting the
formulated hypotheses. Chapter 6 closes this thesis by (i) presenting the major
findings brought to surface by this research; (ii) discussing the major theoretical

implications arising from those findings; (iii) providing recommendations for policy
making in the light of lessons learned from the HSMs life experiences with and in
Mozambique; (iv) suggesting future research; and (v) offering both a brief summary
of the entire research project and some thoughts on the possibility of a future global
partnership for highly skilled migrants.

A Multidisciplinary Overview
Relatively little research has been conducted on Portuguese former African
colonies (e.g., Angola, Guinea Bissau, Cape Verde, Sao Tome and Principe) when
compared to a certain tradition of Anglophone and Francophone research on former
British (e.g., Botswana, Ghana, Uganda, Kenya, Tanzania, and Nigeria) and French
(e.g., Cameroon, Ivory Coast, Mali, and Gabon) colonies, respectively.
Mozambique provides the evidentiary base for this research because it
simultaneously combines aspects that represent current socio-economic trends of
general development in Africa (e.g., poverty, gender inequality, growing democratic
orientations, domestic peace) with unique specificities relevant to address the
hypotheses of this research (e.g., patterns of economic growth, aspects of the
democratization process, regional divisions and ethnic diversity).
Mozambique is a country in the southeast part of Africa with about 20 million
inhabitants spread over 313,661 square miles of territory. Maputo City is its capital
and largest city. This eastern African country is divided into ten provinces which
allows for the study of both regional effects and urban versus rural relationships given
that different geographic locations are associated to different levels of development.
Complementarily, there is a wide diversity of linguistic and ethnic minorities.
Given that, by in large, they are established within specific regions the Yao,
Makonde, and Makua in the north (Provinces of Niassa, Cabo Delgado, and

Nampula), the Thonga, Chewa, Nyanja, and Sena in the center (Provinces of
Zambezia, Tete, Manica, and Sofala) the Shona and Tonga in the south (Provinces of
Inhambane, Gaza, and Maputo) relationships can be suggested between ethnicity
and poverty rates. See Figures la and lb for the Human Development Index (HDI) in
Mozambique by province for the year 2000.1
Cabo Delgado
- "HTimari "Development Index
I--- .205 .236
Wm 236 .257
Fig. 1 a: Political Map of Africa
Fig. lb: Mozambiques HDI
Sources: WB (2007), data UNDP (2000)
Table 1 provides additional detailed and geographically disaggregated
demographic and economic data for Mozambique. The joint analysis of Table 1 and
Figure lb allows the identification of three distinct regional patterns. The North
Provinces have lower HDI but face a country-average proportion of extreme poor
population. The opposite happens in the Center Provinces: country-average HDI but
lower proportion of extreme poor population. A paradoxical situation happens in the
1 The United Nations (UN) HDI is expressed as a number between 0 and 1, with
higher scores indicating a better development. Discrepancies in how HDI and the
percentage of extreme poverty rank provinces are due to the fact that the latter only
reflects the monetary aspect of development. See footnote #3 in Chapter 1 (p. 3).

South Provinces: all provinces face both high HDI and high proportion of extreme
poor population. To propose the understanding of this reality goes beyond the scope
of this research, but there is evidence to conclude that higher HDI is associated with
higher urban development, which, while favoring a better average economic situation,
inexorably results not only in higher economic inequality but also in very severe
urban poverty.
Table 1: Population of Mozambique and Incidence of Extreme Poverty by Province
Province Pop. Extreme
(103)1 poor pop.2
Niassa 1,178 52.1%
Cabo Delgado 1,633 63.2%
Nampula 4,077 52.6%
Zambezia 3,893 44.6%
Tete 1,832 59.8%
Manica 1,419 43.6%
Sofa la 1,654 36.1%
Inhambane 1,267 80.7%
Gaza 1,219 60.1%
Maputo 2,359 60.8%
TOTAL 20,531 54.1%
Sources:1 Mozambique (Census2007)
2 Mozambique (Census 2003)
Some aspects of Mozambique are representative of the current trends in general
development in Africa. For instance, it is only a recently viable democracy, which
reflects the general efforts in Africa to implement sustainable political institutions
(Jacobs and Penate 2008). It was around the 11th century when small socio-economic
human settlements of subsistence-base, in what is today Mozambican coastal
territory, were transformed into emerging state organizations. Trade had
incrementally been developed since the 9th century with the arrival of the first Arab

travelers crossing the Indian Ocean towards the west, mainly from the Persian Gulf.
Until then, people who were mainly Bantu migrating south and east from west-central
Africa practiced agriculture and kept both cattle and small livestock. These people
had mastered iron technology and combined the cultivation of some grains with the
knowledge of root and tree crops. The regions economy was rooted in agriculture
and cattle raising, but its social and political organization became more complex with
Arabic-driven development of local industries and trade, specifically the mining of
gold, copper, and iron ore, and the development of salt pans, tool forges, and potting
industries (Newitt 1997).
As societies evolved, gained complexity, and stratified, the differentiation of
patterns of consumption, viewed as the internal factor, in complement with
immigration, the external factor, boosted trade and economic development. Over the
course of the first half of the second millennium the flow of Muslim immigration,
now also from India, favored further development of trade, markets, supporting
institutions, and also cultural melting resulting from a preponderant male Muslim
immigration. Coastal societies were governed by kings, some of whom were elected,
but mostly due to their own armies.
Mozambiques colonial history began when the Portuguese arrived in
Mozambique in the early 16th century and governed it as part of their India holdings
until 1752. During this period, Mozambique was mainly a source of slaves, gold, and
ivory for Portuguese entrepreneurs and expeditioners profiting from them in
international markets (ibid.). Although the Portuguese style of colonialism was
typical of that time, which in general had the common goal of resource extraction, the

Portuguese rule of overseeing this process was closer to the British than to the French
model and less belligerent than the Spanish. The Portuguese administration reflected
essentially an economic plan focused on maintaining stability, without the goal of
cultural assimilation or the extension of citizenship to colonial subjects as was the
case in the French model. Under this system, the need for direct government
intervention from the Portuguese government was relatively less common. Not only
was this a cheaper system, but it was also more compatible with the relatively small
population that imposed very strong limitations on the Portuguese capacity to occupy
and hold all its territories overseas. Minimizing direct involvement in the colonial
economies (e.g., the Portuguese vice-King in charge of administrating Mozambique
was based in India), the Portuguese government allowed private enterprises to exploit
the natural resources of the colonies in exchange extracting high rents and/or taxes
(e.g., system of Prazos and Companhias) (Ferreira 1982).
The 19th century was a period of intense indigenous insurgence against the
colonial power, but by early 20th century Mozambique was by and large pacified
under the Portuguese domination. In the meantime, as a result of the Berlin
Conference in 1884, which was organized to promote an international agreement to
avoid conflicts among colonial powers because of the division of African territories,
Portugal and England, at that time occupying the neighboring countries to
Mozambique, defined in 1891 what the political boarders of Mozambique would be.
Under the Portuguese administration, Mozambique became an overseas province in
1951 and, after a decade of war for independence, gained its freedom from Portugal

in 1975, as part of the world-wide retreat from colonization. Indigenous democratic
rule, however, had to wait twenty more years to be established (Newitt 1997).
Under a single-party state ruled by FRELIMO, the Mozambique Liberation Front,
Mozambique, like many of its African neighbors, endured a civil war from 1975 until
1992 over the ideological and political control of the country. In 1990, a new
constitution ended a disastrous post-colonial Marxist collectivism and introduced
privatization, a market economy, and multiparty government. Mozambique had
become a parliamentary democracy.
A peace treaty was signed in Rome in 1992 between FRELIMO and RENAMO,
the Mozambican National Resistance and rebels political arm. In the same year,
these two political factions signed an accord, therefore, ending the civil war. The first
multiparty election in Mozambique was held in 1994, and in 1998 the country held its
first local elections to provide for local representation and some budgetary authority
at the municipal level. The influence of provinces, their minority tribes, and even of
other parties at central government level is still very limited, however.
FRELIMO has won all the multiparty presidential, parliamentary, and local
elections held so far since independence in 1975, and it has also achieved majorities
in the subsequent multiparty general elections, beginning in 1994 (i.e., 1994, 1999
and 2004). RENAMO became the second most important political actor in the
country and formed the main opposition in the subsequent parliaments. Other
important non-party political actors are religious in nature (i.e., the Catholic Church,
the Christian Council of Mozambique, which represents the main Protestant churches
in the country, and the Muslim community).

In total, there are currently 42 registered political parties in Mozambique. There
has been, however, an increasing bipolarization of the political spectrum in the
country since 1994. FRELIMO and RENAMO together won 82 percent of the valid
votes in the 1994 election, 44 percent and 38 percent respectively. In the subsequent
elections FRELIMO has been progressively increasing its representative power. In
the 1999 election, the combined share of FRELIMO and RENAMO grew to 88
percent (49 percent for FRELIMO and 39 percent for RENAMO)* 3 and to 92 percent
in 2004. FRELIMO currently holds 64 percent of the 250 seats in the Parliament and
RENAMO the remaining 34 percent (Sitoe et al. 2005). Noteworthy within the
context of this thesis, FRELIMO was created in 1962 by Mozambican emigrants in
neighboring countries.
There are some indicators of Mozambiques socio-economic development. For
instance, measured by the Heritage Foundation (2009) Index of Economic Freedom,
Mozambique was selected as the best country in Africa during the last decade and the
fifth in the world in terms of the overall improvement of its institutions.4 More
specifically, from 1995 (with an average index score of 45.5 points), one year after
the first elections (the year The Heritage Foundation first published this Index), to
Since the majority of the running parties did not reach the minimum threshold rule
of five percent of votes to seat in the Parliament their votes were redistributed among
the parties that reached that threshold. FRELIMO held 51 percent of the seats and
RENAMO 44 percent.
3 The final result was 53 percent for FRELIMO and 47 percent for RENAMO,
respectively, after redistribution of votes.
4 For more details see http://www. heritage. or&/index/.

2009 (average index score of 57.3 points)5, Mozambique improved its overall
institutional quality by 11.8 points, a positive variation of 26 percent. Freedom from
Corruption (the score nearly tripled), Monetary Freedom, Investment Freedom,
and Financial Freedom were the institutional domains that most contributed for this
overall improvement. However, Business Freedom and Trade Freedom faced
depreciations in their scores within this 14 years time interval. After 14 years the
Government Size item, viewed as an indicator of government efficiency, changed
marginally only (+2 percent). The Property Rights indicator remained at the level
of 1995.
According to the Freedom House (2009)6 indicator, which is more focused on
political and civic aspects of the context, institutional advancement was not so
obvious. Political rights conditions in Mozambique remain unchanged since the first
year of elections in 1994 (3 in a scale from 1 [most free] to 7 [least free]). Civil
liberties improved from a rate of 5 to 4 with the first elections in 1994 but have
improved no further since then. Overall, the Freedom House classifies Mozambique
as a partly free country.
The combination of these two sets of indicators, from the Heritage Foundation
and the Freedom House, suggests three observations:
i) Mozambique has been improving some institutional domains (e.g., financial
markets) and has been neglecting others (e.g., non-fmancial markets);
5 The labor conditions component was not included in the calculations for 2009
since it was not yet being part of the Index in 1995.
6 For more details see

ii) The persistent size of government may be hindering the empowerment of
iii) Both of these observations may be related not only to the absence of party
rotation in power, but also to the increasing power of the ruling party.
Mozambicans social, political, and economic dynamics result from being both
one of the poorest and fastest growing countries in Africa and in the world.
Mozambique is the worlds 161st economy out of 177 countries, with $1,379 of gross
domestic product (GDP) per capita PPP (International Monetary Fund [IMF] 2006),
but it grew 9.8 percent in 2006 (CIA 2008). Mozambique is one of the eleven out of
45 African countries that between 1990 and 2003 saw its annual GDP per capita grow
above two percent on average (UNDP 2005), which may benefit a discussion on
cross-country and regional effects from highly skilled returnees (HSRs). Eight
countries grew between one and two percent, eight others between zero and one
percent, and 18 African countries faced negative growth within that period.
Mozambicans sustained growth, driven primarily by investments in physical capital,
reduced monetary poverty by 22 percent between 1997 and 2003 (WB 2007).
Even though this rapid rate of growth is due to a relatively very low baseline for
the absolute value of the Mozambican economy, it makes this country an attractive
case-study for processes of social, economic, and political dynamics. Mozambiques
22 percent poverty reduction rate is attributable to the character of its growth,
including the increased crop income from the rehabilitation of agriculture. The World
Bank (2007) report states:

Growth was also supported by donor aid, which appears to have been
pro-poor as well through backward linkages. Rural and urban
economic growth raised incomes and stimulated demand for nonfarm
goods and services. Growth remained pro-poor because changes in the
structure of production were labor intensive pulling labor out of
agriculture into higher value sectors, in both rural and urban areas.
This raised the productivity of labor and incomes in agriculture, lifting
incomes for the bottom half of the distribution, and contributing 75
percent to the fall in the poverty headcount (p. ii).
In spite of this trend, the principal drivers of personal economic growth are
changing as education becomes more important. Large, labor-intensive firms in urban
areas need educated workers there are virtually no opportunities for those who did
not graduate from secondary school. The shortage of qualified workers has already
pushed up their wages (WB 2007). Moreover, if effective results are to be obtained,
new technologies in agriculture will also require some education for effective
application, either as smallholders or working on medium and large farms.
Mozambique has had a comprehensive poverty reduction strategy since 1999
(called PARPA), but the government lacks a systematic program to collect data on
changes in poverty reduction and household welfare in order to monitor outcomes.
This data gap limits the assessment of the governments effectiveness as well as of
policy monitoring. Perceptions data report widespread satisfaction among the poor
with the governments efforts to expand infrastructure in health, education, and water
supply (WB 2007). The HDI, composed of indicators related to knowledge (e.g.,
literacy and enrollment rates), a long healthy life (e.g., life expectancy at birth), and
standard of living (e.g., income), improved 37 percent, increasing from 0.281 in 1994
to 0.384 in 2005. The real GDP per capita (PPP) that improved 26 percent, from $986

to $1242 within the same 11 years period (UNDP 2008), shows how important the
monetary component of their well-being still is for Mozambican communities.
Overall, inequality in Mozambique measured in terms of income by the Gini
coefficient is relatively low (39.6) when compared to the average Gini coefficient in
sub-Saharan Africa (72.2),7 suggesting a high social permeability to HSRs as opposed
to a more stratified socio-economic rigid society.
In 2008, the service sector was the most important contributor (46 percent) for
GDPs composition, followed by agriculture (28 percent) (e.g., cotton, cashew nuts,
sugarcane, tea, tapioca, com, coconuts, sisal, citrus and tropical fruits, potatoes,
sunflowers, beef, poultry) and industry (26 percent) (e.g., food, beverages, chemicals
[fertilizer, soap, paints] aluminum, petroleum products, textiles, cement, glass,
asbestos, tobacco). With the improvement of crops, techniques, and expansion of
farmed land, agriculture has been gaining importance in the overall GDP composition
(+5 percent than in 2000). The exportation of goods (e.g., aluminum [1/3 of the total],
prawns, cashews, cotton, sugar, citrus, timber, bulk electricity) was 32 percent
(almost twice than in 2000) of the GDP, and imports (e.g., machinery and equipment,
vehicles, fuel, chemicals, metal products, foodstuffs, textiles) accounted for 42
percent. In spite of its one-quarter share in the total GDP composition agriculture still
represents 81 percent of the entire workforce, while services represent 13 percent and
industry six percent only.
The long track record of sound economic and political results since the first
elections in 1994 induced large inflows of foreign direct investment (FDI) into
7 100=maximum inequality and 0=minimum inequality (UNDP 2005).

Mozambique (US$427 million in 2007, more than tripling since 2000), mainly in the
natural resource sectors. Today large foreign investments projects in mining (e.g.,
tantalum, beryllium, coal, gemstones, natural gas) and aluminum smelters have
become the major drivers of growth. In fact, ores and metals represented 55 percent
of all exported merchandize in 2004.
While strong donor support (net official flows totaled US$1,939 millions in 2008)
has been a key driver of development, its 70 percent share in total government
revenues is generally viewed as jeopardizing government autonomy and legitimacy.
Strong efforts have been developed to generate domestic drivers of growth and reduce
its dependence on official development assistance by expanding its fiscal base,
revising its tax policies, fighting economic informality, and investing in infrastructure
development. Nevertheless, domestic businesses continue to encounter difficulties in
accessing electricity, procuring credit and licenses, and dealing with high taxes (WB
The present value of total external debt has been decreasing, partly due to debt
forgiveness. Down from 76 percent in 2004 external debt was equivalent to 34.5
percent of GDP in 2008. Consequently, the debt service as a percentage of exports of
goods, services, and income dropped from 12.5 percent in 2000 to 1.3 in 2007.
Complementarily, Portuguese is the official language in Mozambique and it is
spoken by 40 percent (72% in urban areas) of its population.8
The authors cultural proximity to Mozambique, including the Portuguese as a
common language, which facilitates communication and access to data, sources, and
sample, is also one of the factors determining the choice of Mozambique as the
evidentiary basis for this research.

Traits of a Mozambican Identity
According to Serra (1998), the Mozambican collective way of being (i.e., its
identity) can be characterized by two main ideas: a duty and a task. On one hand, it is
the duty of Mozambicans to preserve the sovereignty and liberty arduously achieved;
on the other, it is their task to improve and solidify the same for future generations.
Never before has the Mozambican identity been so in the center of the intellectual and
political debate, but the paradox, according to Serra, is that never since the
independence has this identity been so threatened. From the outside, national
sovereignty is bound by interdependence of global markets and international
interventionism (e.g., donors, non-governmental organizations [NGOs], political
guarantees). From the inside, national sovereignty is threatened by the apology of the
individual and his/her micro-nationalist interests that ignore a broader idealized
citizenship. Similarly to the United States (U.S.) experience, the cradle of the
Mozambican political project was the rejection by its people of the continuation of
foreign dominance. This collective aspiration has to be understood within the broader
independence and pro-black liberation movements happening across the world in the
1950s and 1960s (Newitt 1997).
For Cahen (1994), Mozambique is a Portuguese invention later developed by un-
rooted dispersed Mozambican elites in search of an identity. Actually, to the Maputo
City-centered Marxism system created by FRELIMO after the independence, Cahen
calls it the centralism of the dispersed. In perspective, FRELIMO, founded in
Tanzania, is the result of a unification of several parties and their leaders: the
National Democratic Union of Mozambique (UDENAMO), founded in Zimbabwe,

the Mozambican African National Union (MANU), founded in Kenya, and the
Independent Mozambique African Union (UNAMI), founded in Malawi.
Eduardo Mondlane, founder of FRELIMO in 1962 and the Mozambican leader
for independence, was the most prestigious Mozambican scholar. He was also a UN
worker in New-York and the husband of a white American woman. Killed in 1959, he
viewed the Mozambican identity as an ambition to transcend the different traditional
micro biology, histories, economies, religiosities, ethnographies, societies, cultures
created within the geo-political space created by the Portuguese colonization.9 For
Mondlane (1983), this ambition is the opposite to tribalism, micro-nationalism, and
regionalism which can only subsist in the isolation of each within their own
particularities. To the extent that, as a unified nation, Mozambique aims at
aggregating traditional societies, Mondlane saw it more associated with modernity,
departing from overcoming particularities through politics, than with traditionalism. It
is so because its vocation does not to go back to its roots, but rather transcends them
by unification.
It is from this idea of nation that institutions are created. Founded upon these
legitimizations, and for power to be exercised, concrete material conditions enabling
a unifying national construction would have to be in place. Only then would the
construction of a one nation project, based on a deep cultural understanding of
populations aspirations and needs, be possible. This was, for Mondlane, the
9 Eduardo Mondlane is an example of HSR who studied in Lisbon and actively
participated in the Mozambican Diaspora there. In Portugal he was exposed to
modem western political schools of thoughts including, as it happened with many
Africans with experience in the U.S. and Europe, getting involved in the political life
of the host country (e.g., parties, independent churches). It was in Lisbon that
Mondlane met the leaders of the Angolan and Cape Verde nationalist movements.

foundational cornerstone of the Mozambican socio-politico contract. The above
described unification of the political parties for the foundation of FRELIMO was,
then, the first materialization of this new ethics.10 Overall, the combining effects of a
common anti-colonial spirit (i.e., the exogenous factor) with the perception of a
common belonging to the same macro-entity by different tribes and regions (i.e., the
national unity and the endogenous factor) should, in Mondlanes vision, be the drivers
for this new and modem Mozambican identity.
Within this framework, the Mozambican government faces tremendous
challenges to set up this socio-politico contract (i.e., the national political project
manifesting a unity in differences). With a very scarce amount of resources available
upon which to base its economy, the government has been challenged to find
innovative and creative solutions to provide for these common and aggregative,
inducing of an active citizenship, institutions (Macuene 2001). For this to be possible,
and closely related to this thesis, Cahen (1994) argues that special responsibility in
this construction have the intellectual, moral, and economic elites of this country (p.
32). In this context, Mozambican institutions should be conceived and viewed much
beyond a functionalist perspective. Instead, there should be a dynamic body of
interactions mediating tensions between the individual (i.e., the content of society)
and the society itself (i.e., the form of society). For without uniting institutions,
Mozambique, as a nation, will cease to exist.
For Cahen (ibid.), conflicts are about resources and not about ethnic identities.
Providing that there is a clear distinction between national (i.e., centralized) and
10 Presidents Kwane Nkhrumah from Ghana and Julius Nyerere from Tanzania played
a key role in encouraging this unification.

regional (i.e., decentralized) resources, the Mozambican construction will not be
threatened (Lundin 1995). Should this prove not the case, urban bias and/or ethnic
hegemony could trigger competition for resources that international aid would then
try to mitigate. The consequence is that traditional tribal/clans authorities, assisted in
some of their most fundamental needs, not by their own state, but by NGOs, will
resist an unfamiliar modernity incapable of providing for life standards (i.e., they will
resist to the new idea of a Mozambican identity and be suspicious of the one nation
In spite of a macro-construction, two elements at a micro-level are important to
build this national identity, Cahen adds: a territory and resources beyond natural
characteristics and life experiences. In this context, moreover in a scenario of very
scarce resources, political leaders have to be able to minimize, if not avoid, regional
economic inequalities. They have to be able to build institutions capable of
redistributing national wealth and/or setting up efficient social arbitrage.
Decentralization implies a concrete administrative division of the territory so that
jurisdictions can be defined, state bureaucracies expanded, taxes collected, and
resources (re)distributed. In this process, as Artur (1999) warns, expansion of the
modem state will collide with ancient traditional jurisdictions and authorities. Not
only will new divisions not match perfectly the previous naturally well defined and
accepted territories, but it will also create confusion and tension among neighboring
traditional leaders eventually adhering to conflicting logics: the traditional or the
modem. For instance, one of the questions raised very often is in which jurisdiction
taxes will be paid. Overall, these institutional overlaps and voids result in a lower

value posited in the usefulness of participating in the democratic constructions,
namely voting, given the reservations and suspicions around the capacity of the
modem state to truly improve the life standards of the communities.
Nowadays, 35 years after the independence and 16 years after the first elections,
there is a larger convergence between the top-down state expansion (i.e., the rational
approach) and the bottom-up incremental adjustment of traditions (i.e., the emotional
approach). Traditional authorities are viewed less as a threat for the politic mainly
because it is now widely understood that they never had the aspiration to rule at
territorial level high enough to include tribes/clans from outside their natural
traditional jurisdiction and legitimization (Salamao 1999). In fact, it would be a
contradiction in nature to have a traditional leader ruling a community that is not his.
Ethnical identity is not only about territory and resources, but also power (Serra
2000). If this is so, the unequal distribution of territory, resources, and power can only
trigger divisions, instigate racism (i.e., exclusion), and ethnocentrism (i.e., inclusion).
Studies in the regions of Inhambane, Lichinga, Tete, Beira, and Maputo point to the
evidence that almost all perceptions of discrimination and stigmatization are related
to possession or depravation of power-related resources, such as schooling,
professional position, and money. It is not by chance that in many Bantu languages,
from which Mozambican local dialects originated, the same expression is used both
for power and wealth (Cabago 1995). More than in reference to a natural
racism differences and divisions are perceived at a material racism level (ibid., p.
45). Racial perceptions are based not on a primordial substance, in its essence, nor
on a specific ontology, but rather on the possession or not of power-related resources

(ibid., p. 52). Being poor for not having money is as detrimental as not having family
or friends to provide for material support (UNDP 2008). More specifically,
perceptions of racism are systematically related to inequalities both in professional
opportunities and access to financial banking credit. In short, it is not from the idea of
race, as a social phenomenon, that one gets to the idea of racism, but rather through
the social construction operated by the association of different ethnicities or races to
different levels of access to and control of power. Paradoxically, it is through
socialization that these constructions are ultimately dismantled.
In conclusion, to make the construction of the Mozambican nation viable,
Mozambican democratic authorities are called upon to design and implement unifying
institutions capable of equally distributing resources, harmoniously bridging
traditional authorities (typically in rural areas) with the modem state (typically in
urban areas), and legitimizing power jurisdictions. Given the very scarce resources
available, however, institutional voids have to be identified and institutional
development prioritized.

Many key variables determine the development landscape. Among them there are
the institutional variables/elements such as the rule of law, governmental
bureaucracies, social safety nets, religion, and market rules. This thesis adopts the
theoretical assumption that quality of institutions trumps everything else (Rodrik
et al. 2004, 131).
The goal of this chapter is to introduce and explore the theoretical framework
chosen to address and illuminate the research question of this thesis. This is
accomplished through a chain of theory-narrowing and focusing steps. First, this
chapter discusses different approaches for and definitions of institutions. Second,
the same discussion is narrowed down and reframed within the developing countries
context. Third, intertwined dynamics between institutions (i.e., context) and
individuals (i.e., behavior) are explored from a rational choice perspective. Next, the
institutional setting is broken down into its building factors towards the identification
of more specific operationalzing elements/variables. Lastly, the institutional approach
is combined with several other developmental theories to identify testable hypotheses
specifically applied to the case of Mozambique.

New Institutionalism
New Institutionalism, Institutions, and Institutional Rational Choice
Using data from 137 countries and applying econometric models to a wide set of
institutional variables, Rodrik et al. (2004) attribute the primacy of economic growth
to the power of institutional change, as opposed to the classic macroeconomic
variables, such as saving rates, trade, foreign direct investment. Rodrik and
Wacziargs (2005) argue that before growth, there has to be the right domestic
institutions in place and not the other way around.1
New Institutionalism (NI) is an approach to politics that holds that behavior is
fundamentally molded by the institutions in which it is embedded (March and Olsen
1984; 1989). As opposed to atomistic views of preferences and resources determined
exogenously, rational calculations of expected utilities, efficient histories, and of
single-equilibrium states (Truman 1951; March and Olsen 1998; Olsen 2001), new
institutionalism views organizational life as highly contextual, assumes rule- and
identity-based action, models actors behavior in accordance with their
interpretation of rules and practices that are socially constructed (Olsen 2001, 193).
Moreover, it seeks to elucidate the role that institutions play in the determination of
social and political outcomes (Hall and Taylor 1996, 936).
DiMaggio and Powell (1991) define institutions as the shared schemas, routines,
norms, government regulations, symbols, and ceremonial traditions that facilitate and
constrain the behavior of social actors. Elinor Ostrom (1999, 37) provides a similar
definition focusing on game theory aspects of human interactions: institutions are
1 From the same author, with different econometric assumptions, but same
conclusions see also Rodrik (1999).

the shared concepts used by humans in repetitive situations organized by rules,
norms, and strategies. North (1994, 2) emphasizes enforcement aspects and
distinguishes between formal and informal institutions: Institutions consist of formal
rules, informal constraints (e.g., norms of behavior, conventions, and self imposed
codes of conduct), and the enforcement characteristics of both.
The differences within these definitions reveal much more than semantic nuances.
Together, these three definitions illustrate the relative wide spectrum of views on how
autonomous an institution can be. DiMaggio and Powells long-lasting institution can
be viewed as the most autonomous, stable, and resilient type of institution. Ostroms
instrumental institution can be viewed as the least autonomous and more manipulated
type of institution. Norths historical institution lies some where between the two.
More autonomous and less autonomous institutions strongly interact across this
continuum. For instance, Argentinas minimum quota laws (i.e., less autonomous
institutions) regulating womens representation in Congress, which increased women
participation to rise from 5.9 percent in 1992 to 30 percent ten years later (Gray
2003), has been reversing the long-standing cultural biases (i.e., more autonomous
institution) against women.
A more structured definition of institutions is proposed by Lowndes (1996, 182):
i) Institution is a middle-level concept:
Institutions are devised by individuals, impose constraints and shape
human action while also providing opportunities. They are the medium
through which day-to-day decisions and actions are taken.2
ii) Institutions have formal and informal aspects:
Institutions involve formal rules of law but also unconscientiously
designed or specified informal norms and customs that are part of
2 See also Rivera et al. (2009) for the mediating role of institutions.

habitual action. Institutions refer to organizational forms as well
processes (i.e., the way things get done).3
iii) Institutions have a legitimacy and show stability over time:
Institutions have legitimacy beyond individuals preferences,
immediate purposes, or outputs. Their legitimacy may result from
stability over time or from their link with a sense of place.4
Departing from this broad definition, several schools of thought have developed
specific approaches to two fundamental analytical issues: (i) how to construe the
relationship between institutions and behavior; and (ii) how to explain the process
whereby institutions originate or change. While Hall and Taylor (1996) talk about the
historical and sociological approaches to institutionalism, Lowndes (1996) includes
the political, economics rational choice, and the organization theory approaches to
The result of autonomy discussed earlier is that many institutions determine social
legitimacy (Suchman 1995) through coercive, normative, and cognitive pressures that
have an isomorphic effect (i.e., the leading actors that operate in the same
organizational field to adopt similar structures and strategies) (Powell and DiMaggio
This thesis assumes the opposite. This thesis adopts Ostroms concept of least
autonomous institutions to assess the extent to which opportunities to manipulate
them can be identified (i.e., changed by the Mozambican Government to improve its
capacity to affect its citizens, in this case, to encourage the retention of highly skilled
returnees [HSRs]). Within the context of this thesis, what informs these opportunities
3 See also Carey (2000) for a discussion on the boundary condition of what is not an
4 See also Kaufman (1976) for a discussion on the resilient nature of institutions.

for change are, then, the HSRs patterns of reintegration once they have returned to
their home country (i.e., their experiences, both positive and negative, with the
indigenous institutional setting). Factors favoring and/or hindering these agents
experiences (i.e., behavior) are viewed as the demand side of a process of institutional
development in which the government supplies (new) policies (i.e., institutions). In
this sense, institutions are viewed as instruments (i.e., means) of HSRs personal and
collective aspirations (i.e., ends).
Institutional Rational Choice (IRC) is one approach both for looking at
institutions with some detail and for operationalize them. IRC is a subset of NI that
explains social decisions by combining the above mentioned dynamics between the
economically rational actor interplaying with the political (i.e., under the construct of
public choice) (Arrow 1951; Olsen 1965; Tullock 2008) and the broader institutional
setting in which actors operate. IRC is a hybrid lens combining economics, public
choice, and new institutionalism. Intellectually, IRC is more resonate to political
sciences than to economics, given its focus on explanations of how separate
individual interests are reconciled, rather than on explanations of profit-maximization
atomistic individuals decisions. A hypothetical situation unfolding within the IRC
logic would be a group of HSRs coordinating action (e.g., the creation of an
association) to lobby Mozambican politicians to pass more favorable legislation on
areas such as money circulation, the right to vote abroad, and/or housing programs.
The hypothetical support of such interests by politicians can also be understood
within the same IRC logic (i.e., politicians seeking their reelection).

IRC is a theory of collective action (Buchanan and Tullock 1965; Ostrom 1990;
2008), but it is more than that because it typically involves several principals facing a
common collective-action problem (Miller 1992). For instance, the theory of the firm
(Coase 1937) and the theory of the state (Bluntschli 1895) are also theories of
collective action. In both theories, however, and contrary to IRC, the efforts of
organizing collective action is undertaken by one principal only, the entrepreneur and
the ruler respectively, whose rewards depend on the surplus generated.
Albeit overlapping, IRC departs from classic institutional theorists, such as
March, Simon, and Cyert. While in both cases, institutions are important for politics
because they structure political behavior, classic institutionalism tends to take
individuals preferences as more exogenous than in IRC, which views them as being
created and changed within the institutional setting in which individuals are
embedded. By focusing on the historical analysis of relatively stable formal
institutions (e.g., organizations, government bureaucracies, state) and process tracing,
very often in a comparative perspective (Cyert and March 1963), classical
institutional theorists view individual behavior embedded in highly contextualized
politics, thus less autonomous than in IRC (March and Simon 1958; March and Olsen
1976). For March and Olsen (1984, 742), institutions are not neutral arenas for the
performance of individuals driven by exogenous preferences and expectations.
Institutions impose elements of order in the sub-systems where they operate and
affect power distribution as well as preferences and incentives. In this sense, Classic
Institutionalism is intellectually closer to Historical New Institutionalism (North

1961; 1990), which focuses on path-dependence dynamics of institutions, than to
other new institutionalism frameworks.
IRC scholars take a more behaviorist approach and move the focus from
institutions surrounding individuals to individuals operating within the institutional
setting. In IRC, the central goal has been to uncover models, frameworks, and
theories of political behavior and action. Scholars in this tradition, such as Ostrom,
Moe, and Williamson, generally argue that once these laws are discovered, models
can be constructed that will help us understand and predict political behavior. IRC
scholars seek to understand what the game is, what its rules are, and how it is played.
Leading proponents in the IRC field propose several research directions. Ostrom
(1999, 36) asks how institutions affect the incentives confronting individuals and
their resultant behavior? March and Olsen (1995, 245) suggest further research on
understanding the role of political institutions in coercion, in managing exchange
through incentives, in redistribution, in building a political culture, and in developing
structures for the sustenance of civic virtue and democratic parties.
New Institutional Perspectives on Development
The 20 century was a century of development with much of the analysis on
shifting development policies focused on the post-1945 world, and in particular
around the concepts of (i) the state and its role and responsibility in developing
national economies and societies; (ii) the place of the market in determining growth
and freedom; and (iii) the rise of civil society (Jennings 2005, 601). Over this
period, several theories (Samuelson 1954; Galbraith 1987; Putnam 1992; Herbst

2000; Sen 2006) were formulated attributing different weights for each one of these
three dimensions when modeling the development function and the greatest good for
the greatest number (Bentham 1789).
Models of foreign aid have typically been the realm of Development Economics.
Traditionally, these models began by focusing mainly on the provision of physical
infrastructure to developing countries in the 1960s and 1970s, through the World
Bank (WB) and the International Monetary Funds (IMF) structural adjustments
programs. During the 1980s, the focus shifted to developing free-market institutions
largely though mass privatizations. In the 1990s, macro approaches were
progressively replaced by ideas of local partnerships based on empowerment and
capacity building (Duffield 1997; Milward and Provan 2000).
Within this trend of larger participation in poverty alleviation initiatives, several
international funding and development agencies began to propose different paradigms
of development (e.g., the Comprehensive Development Framework [CDF], the
Poverty Reduction Strategy Papers [PRSP] by the WB, the Asian Development
Bank [ADB] Plan, the African Development Bank [AfDB] Plan, and the Inter-
American Development Bank [IDB] Plan). The United Nations (UN) Millennium
Development Goals (MDGs) is most probably the one that endorses the development
problem from a more participative, multidisciplinary, and holistic approach.
Regardless of the global merits of these initiatives and policies, the evidence was that
results were far from being satisfactory in Africa (Collier and Gunning 1999; Sen

Currently, Jeffrey Sachs (2005) explanation for the persistent poverty in Africa -
the poverty trap is one of the most comprehensive, and also criticized, attempts to
theorize about this human tragedy.5 According to Sachs, a farm familys income per
capita can increase in at least four ways from one year to the next: (i) savings that
leads to capital accumulation and ultimately higher productivity; (ii) trade through
means of high-value crop specialization, as Adam Smith (1776) suggested; (iii)
technology that leads to technique innovation and higher productivity; and (iv) a
resource boom that expands production capacity and increases the output per person.
The converse of these four factors, combined with adverse productivity shock and
population growth, are then the ways by which the farm family may face decreasing
Poverty trap or, according to Coleman (2005), boundaries of poverty, is what
will happen to a family or a set of families if: (i) they face no or very limited initial
endowments of resources as the social welfare function assumes; (ii) they live in a
country with no matured markets to react to decreasing incomes and/or adjust to new
levels of efficiency as classicists proclaim; or (iii) they live in a country with no
capable and/or no willing state to develop and implement structural adjustments
towards market functioning and social equity. The consequences of the poverty trap
are negative growth, decreasing human conditions, poor quality of life and
continuation of poverty. This means that there will not be a savior or regulatory
invisible hand to sustain the dynamisms of self-sustained economic growth, or, in
5 Sachs is not here being suggested as a superior approach. Instead, being the most
important intellectual contributor for the design of the MDGs, this authors approach
is used as a baseline construction for the discussion on determinants of persistent
poverty that follows.

Sachs (2005, 19) metaphor, these countries will be far from having a foothold on
the development ladder.
There are three fundamental assumptions in this scenario (Sachs 2005; Coleman
2005). The first is that poor people cannot save enough. Due to a mix of reasons that
relates to human (e.g., politics, wars, and bad government) and natural (e.g., climate,
geography, and natural disasters) factors, people need all their income just to survive.
There is neither margin of disposable income above survival that can be invested for
the future, nor lending institutions willing to provide for family needs. The second is
that within this context, a personal strategy of having many children is perceived as
the only strategy to accumulate (human) resources to incorporate in the household
production process as well as providing a social security conduct. The result is that
difficulties or impossibility of saving mentioned in the first assumption are now even
more aggravated with a population growth that outpaces personal savings. The third,
and last assumption, is the increasing returns to capital at low initial capital and
income per person (i.e., the multiply effect of minimal amounts of surplus).
In facing the rationale of the poverty trap, the solution to eradicate the Worlds
extreme poverty within just a generation is to design a plan for each country and
then look for donors to finance the plan in a relatively short period of time because of
the posited urgency to break the negative cycle of the poverty trap (Sachs 2005). The
problem is that even though such top-down approaches are necessary, they are not
sufficient. Typically dealing only with the physical infrastructure requirements (i.e.,
material resources), top-down policies have neglected two other dimensions of the

equation in improving society performance: the attributes of a community and the
rule of law (Ostrom 1999; 2008).
Intimately related to the attributes of a community, the problem that Sen (1981)
identifies with top-down approaches is that even if the conditions for the poverty-trap
are solved with massive fiscal and monetary intervention and/or programs, that will
only address factors negatively affecting ones capacity to provide for her/him self
(i.e., the negative freedom aspect). The absence of interference factors does not mean,
however, that one will have the actual capacity to be or do something for him/her self
(i.e., the positive freedom aspect). For example, in the Bengal famine, Sen uses to
illustrate his approach, rural laborers' negative freedom to buy food was not affected.
They still starved because they were not positively free to do anything, they did not
have the functioning of nourishment, nor the capability to escape morbidity. In
another example from Sen, the right to vote per se is a fairly empty concept if citizens
do not have the functionings to do so, such as the education to be able to choose
and transportation to the polls. Overall, this means that even if some conditions are
necessary, they are not necessarily sufficient. Only when such barriers are removed
can the citizen truly be said to act out of personal choice. It is up to the individual
society to make the list of minimum capabilities guaranteed by that society (i.e., to
shape and define the attributes of a community).
McMillan (2004), countering Sachs, confronts the negative experiences of bold
and non-incremental (i.e., big push or top-down) policies with successful incremental
implementations (i.e., bottom-up) to defend a deliberative experimental approach
(p. 10) where reformers should avoid hubris (p. 3). Examples of the first type of

policies are the foreign aid in Africa, the market reforms in the ex-Soviet Union, the
corruption in privatization in the Latin America, Eastern Europe, and South East
Asia, the change of regime in Iraq, and the radical deregulation in New Zealand that
led to negative growth and high unemployment in the mid-1980s. Examples of the
second type of policies are the opening of domestic markets to investment from
overseas in India although remaining a non-free trader economy, Chinas shift from
collective farms to individual plots in the 1980s that led to 30 years of agriculture
revolution, Ugandas progressive trade liberalization, the Czech Republics
privatizations and creation of financial markets, and Brazils financial liberalization.
Easterly (2006a) criticizes Sachs approach by questioning the effectiveness of
top-down big push strategies and suggests a bottom-up incremental policy design.
Easterly points to the failure of exported western neoclassic solutions (e.g., New Deal
in the United States [U.S.], Marshall Plan in Europe) to solve the drama of persistent
poverty in Africa. Easterly applies models such as multi-principal-agent, transactions
costs, bounded rationality, social capital and networking, history, institutional change,
and behavioral economics to argue that development is a complicated interplay of
markets (with many imperfections), politics, social norms, institutions, and
government policies, social services, and microeconomic interventions (p. 4).
Actions and incentives facing very many actors and multiple equilibria tremendously
increase the coordination problems (Easterly 2006b). One of Easterlys (2006c)
central ideas is that policy mechanisms give insufficient voice to constituents
grievances and alternative conceptions of well-being that place more emphasis on

local needs. He calls for more participatory appraisal methods that add context and
local legitimacy to broader interventions.
What Azariadis and Stachurski (2005) argue, however, is that big-push policies
are indeed needed for a shift to more efficient equilibria. They state, temporary
policy shocks will have large and permanent effects if on-off interventions can cause
the formation of new and better equilibria ... small policy changes are not enough to
escape from their grip. Large changes must be made to the environment that people
face, and the structure of their incentives (p. 87). In practice, however, these authors
warn that engineering the emergence of more efficient equilibria is problematic for a
number of reasons. First, bad equilibria can be stable and self-reinforcing. Such
changes may be resisted by the forces that have perpetuated the inefficient
equilibrium, such as a corrupt state apparatus fighting to preserve the familiar status
quo. Second, coordinating changes in expectations and status quo is difficult because
norms and conventions (i.e., the informal institutions) are highly persistent. Third,
policies can create new problems as a result of perverse incentives.
According to Lindblom (1959, 81) small policy changes through successive
limited comparisons, taking into consideration natural limitations of human decision
makers, is often superior to making radical ones. It is by muddling through that
policy can better serve higher levels of social welfare. Bendor (1995) argues that the
decision about which approach to use incrementalism or big push is not as clear as
Lindblom suggests, because it should take into consideration the trade-off between
the benefits of riskier distributions of new alternatives and the increase of difficulty in
evaluating bold (i.e., big push) alternatives. In the current development context,

incrementalism and bottom-up development programs are generally viewed as
preferred approaches because development is understood as an indigenous process
rather than one of transfer or absorption (UNDP 2005; WB 2007). Alternatively to
massive structural adjustments, such as currency devaluation and privatizations,
imposed from above by international agencies and governments onto their
communities, development programs nowadays tend to focus more on communities
participation and empowerment, stakeholders networks, and implementation of
smaller-scale pilot programs in search of smart and best practices for future
replication and escalation.
North (1994, 1) stated that the explanations derived from neoclassic [economic]
theory are not satisfactory to explain economic and social development, because
while the models may account for most of the differences in performance between
economies on the basis of differential investment in education, savings rates, etc.,
they do not account for why economies would fail to undertake the appropriate
activities if they had a high payoff. North and his colleagues (North et al. 2003, A12)
later stated that the market-based policies the so-called Washington consensus -
that underpinned the African experiments had a fatal flaw: they assumed that
economic reforms can create efficient markets without simultaneous reform of the
political institutions. North suggested that what shapes this performance are the
institutions that define the incentives that affect the choices of individuals. North
seems to emphasize March and Olsens (1984) ideas of a more autonomous role for
political institutions as determinants of democracy in parallel with economic and
social factors.

Several empirical arguments on development at country level support theories
pointing to the primary role institutional development plays in achieving broader
socio-economic and political goals. For instance, Rodrik and Wacziarg (2005) use
annual frequency data and panel data to examine the within-country effects of
democratic institutions on economic growth. Focusing on Benin, Mali, and
Madagascar, these authors argue that democratization tends to follow rather than
precede declines in growth (p. 5). The example of the Argentinean crises that started
in late 2001 shows how Rodrik (2002) agrees with North on the need for
institutional innovation based on domestic needs and local knowledge (p. 15) prior
to economic-driven trade liberalizations imposed from above. In this sense, HSRs
cannot only be viewed as a privileged source of indigenous knowledge, as opposed to
that of international consultants, but also as agents with an extra incentive to provide
for the needs of their home communities. Moreover, they can also bring international
benchmarks experienced and assimilated while abroad into their countrys policy
Complementarily, Barro (2003) integrates a complete review of the literature on
the determinants of growth in his cross-country econometric models to conclude on
the central role institutions play in development processes. He uses 30 different
variables, including special indexes to measure institutions for a sample of 113
countries from 1965 to 1995. Barro found, as did Rodrik and Wacziarg, a very strong
statistical significance to parameters associated with institutions such as, for positive
effects, the rule of law, property rights, and internal openness. For negative effects,
the ratio of government consumption to gross domestic product (GDP) was also very

significant.6 Specifically for the case of Mozambique, Castel-Branco (1995, 609)
states: to establish free markets one needs first to establish a state as strong enough
to be able to extensively and effectively intervene.
Similarly, Acemoglu et al. (2002, 1) found that distortionary macroeconomic
policies are more likely to be symptoms of underlying institutional problems rather
than the main causes of economic volatility. Their main argument is that there is a
strong and robust relationship between the historically-determined component of
postwar institutions and volatility. These authors use economic data from 1970 to
1997 for 96 countries, as did Barro (2003) and Rodrik et al. (2004), historical data
that go back more than 100 years, as well as sociological and political data that allow
addressing the role of elites and political bargaining in institutional distortions (see
also Acemoglu 2006).7
Institutional Creation, Role, and Change in Institutional Rational Choice
In IRC, institutions are created on the understanding that two or more people can
be better off by acting together (i.e., cooperating), within an institutional setting
(Buchanan and Tullock 1965; Ostrom et al. 1994; Axelrod 1997). There are five basic
sources for these gains that apply to different degrees across all institutional designs
(Beinhocker 2006): (i) the increments in productivity resulting from the division of
labor (e.g., information-processing, cities, armies, factories); (ii) the new possibilities
6 For an application of a different econometric tool seemingly unrelated regression
(SUR) but same results, see Barro (1999).
7 For a discussion on institutional persistence and economic development, with
application to early United States, colonial India, and Guatemala see Acemoglu et al.

of trading mutual benefits as a result of a more heterogeneous pool of tastes and
preferences (e.g., markets, civil organizations); (iii) the benefits of increasing returns
on scale (e.g., knowledge sharing, friends, languages, hierarchies); (iv) the
smoothness of uncertainties over time (e.g., trust, contracts, family); and (v) the
reduction of transaction costs (e.g., agreements, laws, constitutions).
Given the natural tension between cooperation and self-interest (Wright 2000),
two conditions must occur to encourage people to act together: (i) a distributive
mechanism to allocate and share payoffs; and (ii) a management mechanism to deal
with defection and free-riding (i.e., illicit benefit from a public resource either due to
excessive consumption or unfair participation in its production costs). This tension
between cooperation and self-interest, and the interconnection between institutions
themselves, clarifies the critical role that the rule of law (i.e., mechanisms for
enforcement and adjudication) plays for a well functioning of formal and infonnal
institutions (North 1990). For example, Ostrom (1990; 2008) focuses on the
institutional arrangements needed to address coordination problems in common-pool
resources among potential competitive players in developing countries. Other authors
argue that institutions are created to reduce participants transaction costs in making
deals or undertaking activities (Coase 1937; Buchanan and Tullock 1965; Moe 1984;
Williamson 1985).
Within this context, institutional change mainly occurs as a result of the
entrepreneurs comparisons of the gains from the existing framework with the gains
from trying to alter that framework (March and Olsen 1995). This happens because,
once created, institutions become factors with the potential of blocking and distorting

or resolving normal economic processes. Institutions that hinder some, typically
less powerful, individuals or groups may well do so by favoring typically others more
powerful. The reason for this is that the stability of institutions leads to a filtering
process of interests and preferences which mobilize political bias towards some and
not others (i.e., institutionalization with and of bias) (Schattschneider 1960 [1975]).
Examples of these inefficient institutions are revenue extraction, factor price
manipulation, and political consolidation (Acemoglu 2005). This happens even in
situations where affected actors voluntarily adhered in the past to now-binding
institutions. If a given institution is subject to a process of competitive selection, it
survives primarily because it provides more benefits to the relevant actors (e.g., lower
transaction costs) than alternate institutional forms (Hall and Taylor 1996).
Kaufman (1985) views randomness rather than rationality as the key factor in
institutional survival. Change, according to Kaufman, comes with time, as the
complexity of evolutionary adaptation increases and leads to structural alterations and
the assembly of new alliances. In this sense, statistical probability must be recognized
as a contributor to success or failure in institutions. This is so because, even though
decisions may be based on the best information available at any given moment in
time, conditions change, are unpredictable, and responses sometimes lead to different
results from what was expected.
While accepting assumptions of an individuals utility-maximizing behavior, the
IRC highlights the emergence and persistence of institutions in the face of cognitive
limits, incomplete information, and difficulties in monitoring and enforcing
agreements (Lowndes 1996). In this sense, IRC avoids three of the main criticisms

Rational Choice Theory faces, in particular those applied to political sciences (Green
and Shapiro 1994). First, IRC does not assume perfect information and individuals
are modeled as bounded rationally. Second, in IRC, preferences are neither complete
nor exogenously determined; they result endogenously as different actors adjust their
own expectations and preferences based on other actors expectations and
preferences, and as actors interact with the institutional setting. Third, IRC does not
focus only on outcomes. In IRC, results are the corollary of individual or collective
bargaining processes assessing pay-offs from different possible solutions. Green and
Shapiro (1994, 6) assert, however, that in our view, the weaknesses of rational
choice scholarship are rooted in the characteristic aspiration of rational choice
theorists to come up with universal theories of politics.
Breaking Down the Institutional Setting
Having proposed why, how, and in which circumstances a broad institutional
setting may affect behavior, and vice-versa (i.e., they co-evolve), the next goal for
this thesis is to delve in the identification of more specific contextual factors affecting
HSRs, which are used to support the IRC concept.
In a fast-growing economy, such as the one of Mozambique, where the horizon of
production possibilities has been changing swiftly for the last sixteen years (WB
2007), the possibilities for further development are viewed more as a function of
evolving formal institutions than evolving informal ones (i.e., there is an urgency to
swiftly move from informal to formal forms of organization of life in society). This
thesis argues that further development will be more likely bounded by formal than

informal institutions (i.e., there is an urgency to identify institutional voids). As such,
three steps are here proposed. First, the general categories of variables important in
any institutional choice setting are derived from the Institutional Analysis and
Development (IAD) framework. Second, more specific structuring and contextual
elements, and the direction of their specific effects on HSRs retention, are derived
from two fields of literature: (i) return migration theories; and (ii) international
(Mozambican) development theory. Lastly, within the context of the international
development literature, the extent to which institutions and other factors explored in
previous sections differ from urban to rural settings, and vice-versa, is also discussed.
Institutional Analysis and Development, Contextual Factors, and the Action Arena
IRC tends to stress the formal (as opposed to informal), the dynamic (as opposed
to stable and historical), and the strategic (as opposed to norm-governed behavior)
features of institutions and individual response. Rivera et al. (2009) are aligned with
this conceptualization when arguing that one of the reasons why institutions exert a
moderation effect between actors and the environments in which they operate is
that the institutional setting also determines the availability of resources and how they
are exchanged by the different agents involved (also Friedland and Alford 1991).
Ostroms (1990; 2008) IAD is intended to provide guidance on the variables that
may be relevant in any institutional action arena. As a framework, however, it does
not posit theoretical cause-effect relationships among variables. Instead, the IAD,
supported by over 5,000 case studies collected on common pool resources (CPR)
(Fukuyama 2000), is open to working with different theories illuminating those

relationships (e.g., in the case of this thesis, two other complementarily theoretical
bodies are applied).
The IAD focuses more on the game theory dynamics of multiple principals
revolving around a common institutional problem (Ostrom et al. 1994). There are
several seminal works for the foundations of the IAD. The application of Kenneth
Arrows (1951) Social Choice and Individual Values to social welfare has generally
been accepted as the first of those works. Second, Hardins 1968 essay on the tragedy
of the commons illustrates Aristotles (Politics, Book II, ch. 3, 1261b) idea that what
is common to the greatest number has the least care bestowed upon it. Everyone
thinks chiefly of his own, hardly at all of the common interest. Third, the prisoners
dilemma game (Dawes 1975) where, paradoxically, individual rational strategies lead
to collectively irrational outcomes. Fourth, the logic of collective action (Olson 1965)
challenges the presumption that the possibility of a benefit for a group would be
sufficient to generate collective action to achieve that benefit.
To the extent that the HSRs population is viewed as multiple actors pursuing
individual goals within a common, resources limited, institutional setting, the IAD
framework is particularly relevant for understanding how individual behavior relates
to macro structures. The bargaining between interest parties is, in Norths (1994)
framework, the central element for the process of institutional change.
Ostrom starts by defining action arena as a multidimensional space where
different actors (e.g., HSRs) interact around a common situation the action situation
(e.g., Mozambique). Actors, individuals or groups, are characterized by (i) the
preference evaluations that actors assign to potential actions and outcomes; (ii) the

way actors acquire, process, retain, and use knowledge contingencies and
information; (iii) the selection criteria actors use for deciding upon a particular course
of action; and (iv) the resources that an actor brings to a situation (Ostrom et al.
1994, 33). An action situation is the social space where individuals interact,
exchange goods and services, engage in appropriation and provision activities, solve
problems, or fight (ibid., p. 28), and includes the following elements: participants
in positions who must decide among diverse actions in light of the information they
possess about how actions are linked to the potential outcomes and the costs and
benefits assigned to actions and outcomes (ibid., p. 29).
If, on one hand, action arenas are the IADs focal unit of analysis, on the other
hand, they are also viewed as dependent variables influenced by three different
clusters of contextual/exogenous/explanatory factors. Ostrom (2005, 16) argues that
Rules, the biophysical and material world, and the nature of the community all
jointly affect the types of actions that individuals can take, the benefits and costs of
these actions and potential outcomes, and the likely outcomes achieved [emphasis
added]. Only the cluster rules, which also includes personal norms, social norms,
and strategies (Crawford and Ostrom 1995), falls within Ostroms concept of
institutions. Ostrom, then, conciliates three competing ideas up to this point. If, on 8
8 This is why it is inaccurate to identify Ostrom more with formal institutions, as she
explicitly talks about diagnosing the rules in use which, even if occasionally
equivalent to formal institutions, may also reflect shared strategies and norms (i.e.,
informal institutions). In practice, however, Ostrom has tended to measure and study
those institutions that are rules in her definition of institutions, as well as shared
strategies, but less so on norms. For a deeper understanding of the institutional
diversity and, in particular, how rules can be further broken down into different sub-
categories (i.e., position rules, boundary rules, choice rules, aggregation rules,
information rules, payoff rules, and scope rules) see Ostrom (2005).

one hand, Ostrom attributes primacy to the role of institutions in development, on the
other, she also includes and bridges in her collective action problems, the macro neo-
classic economics infrastructures (i.e., biophysical and material conditions) and the
micro ethnographic functionings (i.e., community attributes). This theoretical
conciliation is not only in terms of a set of different independent variables jointly
influencing a dependent variable. This theoretical conciliation also assumes that the
independent variables institutions, physical conditions, and community attributes -
influence each other as they co-evolve. The IAD proposes a move from the logic of
self-interest-centered approaches to the spirit of interdependence around those three
broad clusters of factors.
It may be claimed that Ostroms solutions are not governmental solutions,
therefore falling outside of the scope of a thesis that explicitly debates the role
government can play in attracting and retaining HSRs in its country. Ostroms
framework relies, however, upon the mediating role government can play either in
creating the incentives for different actors to coordinate action (i.e., to condition
patterns of pay-offs) (e.g., tax deductions for donations to non-governmental
organizations [NGOs]), or in formally institutionalizing more sustainable practices
(e.g., fishing quota for protection of species). Even though there may exist no
government ownership in a particular common situation, the government can still
change the underlying conditions around any given action arena (e.g., by influencing
the contextual factors) to shape situations and direct behavior (Banana and Gombya-
Ssembajjwe 2000).

Departing from this strong co-evolutionary dynamic and relationship between
institutions (i.e., rules in place) and other contextual factors (i.e., community
attributes and material conditions) the next three sections are dedicated to identify
which specific types of institutional, community, and biophysical variables mostly
affect the possibility of retention of HSRs in Mozambique. While the IAD, as a
framework, points to general types of these variables, theories of international
development and returnees are used to identify the specific variables to be tested. This
set of variables is then used, as independent variables, for the formulation of four
testable hypotheses. The expression institutional setting used throughout this thesis
then refers to the landscape of factors (i.e., institutions plus other contextual elements
co-evolving as they interact with each other) in which HSRs try to mobilize resources
over time towards their personal goals.
Return Migration Theories and Community Attributes
Given the high potential value of return migration to the society, many initiatives
by national and international agencies have been directed at attracting their
expatriates back especially the highly skilled (Ghosh 2000). Appendixes A and B
provide some examples of these policies in a wide diversity of countries (Lowell
2001; Wickramasekara 2002). Besides policies that encourage the return of skilled
labor, governments can also fight the brain drain with retention policies, either
through educational sector policies (e.g., Indian university budget increases) and/or
economic development (e.g., Indian expatriate investment outreach).

Overall, the return migration literature broadly refers to the Six Rs
(Papademetriou and Martin 1991; Lowell and Findlay 2002) when breaking down the
range of possible policies vis-a-vis high skilled migrants, from a source/sending
country point of view: (i) the return of migrants to their source country; (ii) the
restriction of international mobility to nationals and foreign workers; (iii) the
recruitment of international migrants; (iv) the reparation for loss of human capital
(compensation); (v) the resourcing expatriates (diaspora options); and (vi) the
retention through educational and economic sectors policies (see Table 2 on the next
page for a comparative analysis of the most relevant international migration theories).

a muiv a uwiivj \J i ivvium iviigi uvivu
Neoclassic Economics New Economic of Labor Migration Structuralism T ransnationalism Cross-border Social Network Theory
Return Migration Those who stay in receiving countries are those who have succeeded. Return is an anomaly, if not failure of a migration experience. Return is part and parcel of migration project (seen as a calculated strategy). It occurs once migrants objectives are met in destination countries. Core/periphery dichotomy. Return to home countries occurs without changing or compensating for structural constraints inherent in peripheral origin countries. Return is also based on incomplete information about origin country. Return is not necessarily permanent. It occurs once enough financial resources and benefits are gathered to sustain household and when conditions in home country are favorable. It is prepared. Return has a social and historical background. Rturn is secured and sustained by cross-border networks of social and economic relationships that convey information. Return only constitutes a first step towards completion of migration project.
The returnee Embodies the unsuccessful migrant who could not maximize the experience abroad. Embodies the successful migrant whose goals were met in destination countries. The returnee is a financial intermediary and a target comer. Neither a successful nor a failed migrant. Brings back savings to home country. Return expectations are readjusted and adapted to structural context at home. Behavioral divergence occurs on return. Only the ill, old, retired and untalented return, i.e., cost of return is limited. Belongs to a globally dispersed ethnic group (i.e., a diaspora consciousness). Succeeded migration experience before returning. The returnee defines strategies aimed at maintaining cross-border mobility and linkages embedded in global systems of ethnic and kin relationships. A social actor who has values, projects, and own perception of return environment. Gathers information about context and opportunities in origin countries. Resources are mobilized before return. Belongs to cross-border networks involving migrants and non-migrants.
The returnees motivation Migration experience failed. Need to return home. Attachment to home and household. Goals are met. Attachment at home and household, nostalgia. Motivations are readjusted to realities of home market and power relations. Attachment to home and household. Family ties are crucial. Social and economic conditions of return are perceived sufficiently favorable to motivate return. Embedded and shaped by social, economic, and institutional opportunities at home as well as by relevance of own resources.
Financial capital No income or savings from abroad are repatriated. Remittances constitute an insurance against misfortune. Assist household members. Savings and remittances have no real impact on development in origin countries. Household members monopolize financial resources. No multiplies effect. Pensions and social benefits are part of remittances. Financial resources are used according to institutional conditions at home. Transform economic and political structure of sending areas. Remittances and savings constitute just one type of resources. May be invested in productive projects aimed at securing return.
Human capital Skills acquired abroad can hardly be transferred to origin countries; they do not match local needs. Human capital is wasted. Acquisition of skills varies with probability of return. Skills acquired abroad are wasted owing to structural constraints inherent in origin countries. Social status does not change. Improved skills and educational background gained abroad allow upward mobility. Skills acquired abroad, as well as knowledge, experiences, acquaintances and values, are contributory factors to securing return.
Source: Cassarino (2004)

One way of looking at and comparing these theories is by analyzing how they
model the unit of analysis under consideration the returnee. While the three first
theories the neoclassic, the new economic, and the structuralist view the
migratory process as a two-stage single cycle of leave and return, the remaining two
view the migratory process as multi-cycles of leave and return (i.e., brain circulation).
The first three theories, however, value the decision to return very differently.
While for the neoclassic approach, the return is an anomaly, if not a failure of the
migrant experience, since the successful migrants maximize their experience abroad,
for the new economic theory, the return embodies the successful migrant whose goals
abroad were met. For the structuralist approach, the return is neither a reflex of
success nor failure. Typically associated with inactive migrants (e.g., ill, old, retired)
the return is more determined by contextual conditions in the home country (e.g.,
attachment to home or nostalgia) than to a calculated cost/benefit personal analysis.
What distinguishes the transnational and the social network approaches is the degree
of migrant circulation and the role played by networks. While the transnational
approach embodies the successful migrant belonging to a dispersed ethnic group and
continuously maintaining across-boarder mobility, for the social network approach,
even though s/he experiences less mobility, the return is secured and sustained by
effective cross-boarder networks of social and economic relationships.
In a study about British and Indian highly skilled migrants, Harvey (2009) argues
that the availability of professional opportunities in the home country (i.e., new job
offers, or business ventures such as starting-up companies) is the most important
factor for return and retention. Although income was also an important factor, the

nature of their new job or business venture as well as the quality of their lifestyle was
significant in their decision to return to and remain in their home country (Iredale et
al. 2003; Saxenian 2006; IOM 2007).
Referring to HSRs, Saxenian (2006, 326) argues that [t]hey serve as role models,
mentors, partners, and investors for entrepreneurs in their home countries ... they
reject the familial, opaque, and frequently corrupt business practices that dominate in
many developing countries.... Most are motivated by professional challenges as well
as economic opportunity. According to Saxenian, HSRs represent and provide an
essential mix of local knowledge (i.e., informal institutions) and global connections to
markets and networks (i.e., formal institutions) required for developing countries to
overcome problems of (i) being remote from sources of leading-edge technology; and
(ii) being distant from developed markets and their interactions with users that late-
developing economies typically face.
In spite of several policy initiatives within the African political agenda on
migrations and development (e.g., Migration and Development for Africa program
[MIDA] by the International Organization for Migrations [IOM], Transfer Of
Knowledge Through Expatriate Nationals program [TOKTEN] by the United
Nations Developed Program [UNDP]), there is still a very limited understanding of
how public policy may affect micro level patterns of migrants mobility (Dustmann
2003; Cassarino 2004).
In his approach to Italians returning from the U.S. to Southern Italy, Cerase
(1974), arguably the most noted author in this particular issue, classifies them into
four categories. The first, return of failures, for those who spent only one or two

years in the U.S., life there was more often than not miserable: if they held a job at
all, it was an unskilled job and one they disliked; rarely had they a home; more
often than not they had lived in boarding houses, or even in factory barracks (ibid.,
p. 251). They are, then, the returned migrants who have failed, failed both to get
launched in the new society, and what is even more significant to live up to their
expectations of the advantages to be derived from emigration (ibid., p. 254). The
second, return of conservatism, refers to those who in the new society remained
aliens with their minds fixed on their return home, hopefully with enough money to
buy a small piece of land ... however minimal they may have been, it required a
certain number of years of hard work in the U.S. (ibid.). In this category the
immigrant continues to consider his earnings as well as his investments in terms of
the traditional scheme appropriate to his own country (ibid., p. 251). Cerase
continues, While in the U.S., they seldom acquired new occupational skills, and
those they did learn were soon forgotten because of their discontinuous work
experience (ibid., p. 256). The third, return of retirement, refers to
those migrants who have returned to retire. America is not a land for
old people. Their health was poor, their social security pension
allowed them a more comfortable living in Italy than in the U.S., and,
in addition, they had hardly any family ties in the U.S.... Retired
returnees look upon their return as the beginning of the last stage of
their life.... They have lived a full life in the U.S.... But their sense of
belonging could not go beyond a certain limit (ibid., p. 257).
According to Cerase, returnees from these three categories are not active in
politics. Those from the first two categories are similarly apolitical because of their
low skills levels, a lack of material resources, and the absence of social ties. Those
from the third category are not engaged largely because they are too old. The fourth

category, however, return of innovation, refers to those who look upon return as
the beginning of a new stage of their life (ibid.). In this category the immigrant sees
in his return home a possibility of a greater satisfaction of his needs and aspirations
(ibid., p. 251). Further his will, his means, and his belief are new and, strictly
speaking, innovative (ibid., p. 259). Contrary to other categories, the return of
innovation aims to disrupt the old equilibrium in the local power structures. Related
with this thesis, Cerase confesses that this research on return migration began with
the innovative returnee in mind. The assumption was that he could have acted as a
carrier of social change.... He considers himself an innovator (ibid., p. 258).
Similarly to what is proposed in this thesis, Cerase also uses a single nation to
formulate his generalizations. Even though his study was carried out 36 years ago,
Cerases special interest in the returnees more associated with change and innovation
is highly supportive of the focus of this thesis on HSRs.
For Cassarino (2004), returnees entrepreneurial capacity to secure reintegration
at home lies at the intersection of patterns of resource mobilization (i.e., material,
human, information about conditions at home, financial), return readiness,
motivations, and contextual factors in origin countries. In this sense, the HSRs
capacity to interact with the context in the home country is not merely the result of
their educational levels and/or knowledge acquired. In a broader sense, retaining
HSRs is not only about increasing the educational levels in developing countries. It is
also about importing tangible (e.g., savings accumulated abroad) and intangible
resources (e.g., professional networks) networked around the HSRs.

Overall, the literature and their attendant policies have focused on the economic
aspects of the HSRs retention process. More specifically, intimately related to the
IADs material conditions, special emphasis has been paid to resources available to
HSRs (e.g., lowering HSRs transition and transaction costs) and the rule of law (e.g.,
job/professional/entrepreneurship-related programs). Fukuyama (1992) argued that
what drives men and women is the attainment of personal recognition based on a deep
sense of self-worth.9 If this is so, not only does it help to explain why so many
Africans decide to return to communities deprived of material conditions, but it also
shows that material-based explanations are insufficient to explain those decisions
(e.g., the role of family, community, culture). Fukuyama states: as populations
become better educated people begin to demand not simply more wealth but
recognition of their status (p. vxiii).
Some examples are useful to illustrate the role policy can play in fostering
development. Iredale and Guos (2001) report that 78 percent of the total labor force
in Hsinchu Silicon Valley, Taiwan, which is a very successful establishment of
information and communication technologies (ICTs) and other high-tech industries, is
occupied by postgraduate returnees, support the likelihood that in Taiwan the highly
skilled returnees are able to utilize their skills and knowledge gained overseas to
induce change and development on both the regional and the national levels.
In the case of the Peoples Republic of China, these same authors found that the
primary motivation of return for returnees was to gain full recognition of their
professional knowledge and skills. Respect and responsibility were the two major
9 See Maslows (1943) hierarchy of needs for an earlier formulation of a theory of
human motivation.

concerns of these returnees.10 Iredale and Guo (ibid.) found that 60.6 percent of the
Chinese returnees saw themselves as carriers of advanced techniques and managerial
skills that had made a contribution to the Chinese economy (ibid., p. 14). Moreover,
respondents who were in managerial or professional positions played an important
role in decision-making in their work places but most Ph.D. holders, who were in
research institutes and universities, felt they had had little decision-making impact
In the case of Bangladesh, most of the returnees interviewed valued the
knowledge and skills they obtained abroad. Overall, they felt more confident, and
their status within the community had increased (ibid., p. 17), but in general the
domestic social and political environment (e.g., corruption, nepotism, and lack of
good governance) is inhibiting peoples return and is also a major factor in
minimizing returnees role in society (ibid., p. 18). In another country, Xiangs
(2000) research into Indian information technology professionals in Australia shows
that they are very active in forming a bridge in the industry between India and other
parts of the world. Birdsall et al. (2005, 7) state China and India suggest that the
secret of poverty-reducing growth lies in creating business opportunities for domestic
investors, including the poor, through institutional innovations that are tailored to
local political and institutional realities. Yang (2006) reaches the same type of
conclusions for The Philippines.
10 Iredale and Guos add one more type of return motivation return for respect to
Cerases (1974) typologies. The migrants falling into this category were found to be
much more likely than the less skilled to report that they returned to earn respect.

Thomas-Hope (1999, 1) states, [different types of return migrants have the
potential to make different kinds of contributions to national development some
through their skills, educational and professional experience, others through the
financial capital which they transfer for investment or as retirement income. She
illustrates her argument with two examples. First, the percentage of the rural sample
who owned no land prior to their migration was 67.6 percent while only 42.6 percent
were in this situation after returning. Taken on its face and value, this could mean
that, hypothetically, the more people that have private possessions, the stronger the
social pressure for better property rights laws would be. This has been pointed out by
several authors as crucial for the development of competitive market forces and the
whole economy in general. Second, she defends that in addition to considering
migration from a demographic aspect, account must also be taken of the importance
of movement of capital, ideas, influence and goods (ibid., p. 191).
Black et al. (2003) use a sample of 604 highly and less skilled returnees from
Europe and North America to Ghana and Ivory Coast to conclude that highly skilled
returnees emphasized changes in the workplace and their influence in public life,
less skilled returnees were more likely to cite their contribution to change in the
family (p. 3). However, Saxenian (2006, 332) cautious: [t]o date large parts of
Africa and Latin America have yet to build the base of skill and the political and
economic openness needed to become attractive environments for technology
entrepreneurs. Saxenian adds, some HSRs are not likely to gain access to capital,
professional opportunities, or respect when they return home (ibid., p. 333).

Hi: Increased access to professional opportunities favors retention of HSRs.
Professional opportunities are viewed here as an example/element of the IADs
community attributes and, as the hypothesis itself clarifies, the idea is more related to
the actual access of HSRs to suitable opportunities than to general conditions of job
market supply (i.e., existence of professional opportunities). Actually, the idea of
access implies not only the existence of such professional opportunities, but also (i)
the capacity of HSRs to be informed about that existence; and (ii) the possibility of a
consonant match between the HSR and the opportunity either in terms of geographic
location, education level required, or skills needed, among others. In the latest
poverty reduction strategy (PARPA II), and related to the entrepreneurial side of
professional opportunities (i.e., as it distinguishes from the employment side), the
Mozambican Government recognized that maintaining the high average annual
growth rate achieved in previous years along with continued poverty reduction
requires an active role from the private sector.
International Development Theories and Biophysical/Material Conditions
There are a number of critical issues in developing countries, such as
infrastructures and government capacity. According to UNDP (2001) ICTs are one of
those major critical issue and can be used to support growth and development. ICTs
are broadly defined as the group of technologies that is revolutionizing the handling
of information and embodies a convergence of interest between electronics,
computing and communication (Drew and Foster 1994, 2). ICTs include electronic

networks embodying complex hardware and software linked by a vast array of
technical protocols (Mansell and Silverstone 1996). ICTs are embedded in networks
and services that affect the local and global accumulation and flows of public and
private knowledge. According to the United Nations (UN) Economic Commission for
Africa, ICTs cover a wide range of services and equipment from internet to
telecommunications, from TV receivers to mobile phones, from information
technology to media and broad band, and other related information and
communication activities. Observers estimate that with the era of new technologies,
African countries have an unprecedented opportunity to gain access to, to take
advantage of, and to fully contribute to a globalized world constructed on knowledge.
Indeed, ICTs-related, accurate and reliable information is a key element for
sustainable development (Brodnig and Mayer-Schonberger 2000).
Like any other technology, it is the social context in which ICTs have been
introduced and implemented that determines their uses and impacts. Therefore, the
digital revolution is relevant for Africa only if its citizens take into consideration the
daily realities, and users attitudes and expectations (Uimonen 1997; Dutta et al.
2004; Scott et al. 2004). For instance, within the particular context of Mozambique,
where 80 percent of the population live in rural areas, companies that have
traditionally targeted subscribers in urban areas, need to be encouraged to find market
incentives to maximize the benefits that this technology can bring to the poor, and to
make sure that this includes the most marginalized communities (i.e., remote). For
this, Scott et al. (2004) proposes: (i) new partnerships to develop low cost tariffs, and
low cost solutions to network extension into remote areas; (ii) the support of industry

of technology entrepreneurs (from both the private sector and NGOs) in order to
foster the local development of mobile phone based applications which can improve
the delivery of services to the poor; and (iii) the integration of mobile phone services
with financial institutions to enable the poor to overcome distances, to benefit more
from remittances, and to enjoy cashless transactions. Saxenian (2006, 327) puts it this
way: digital technology empowers individuals and supports a return to free market.
ICTs are a good example of how (IADs) material conditions (e.g., physical
network infrastructure) of a given institutional setting may be so inter-related with the
rule of law (e.g., regulations affecting internet providers and/or mobile phone
operators) in that same setting. ICTs are becoming increasingly important to African
countries as (i) an infrastructure service (e.g., improving efficiency of markets,
contributing to empowerment); (ii) an economic sector (e.g., mobile operators can
make large profits and pay taxes); (iii) a development tool (e.g., mobile phones have
increased the efficiency of service delivery to the poor, such as for weather
information, market prices, and tracking diseases); and (iv) a household expenditure
that maintains social capital and sense of well-being, and contributes to economic
management (e.g., it saves time, makes business more dynamic; all of these tend to
improve household income and reduce risk) (Scott et al. 2004).
On the relationship between ICTs and poverty alleviation, Scott and colleagues
In the future the poor will benefit from improved services, and will be
empowered by opportunities to engage with governance structures. In
the long term, it will be the norm for government departments to use
portable technologies to deliver public and pro-poor services. Pro-poor
services and applications will be driven by a network of African

technology entrepreneurs and a vibrant private sector working in
collaboration with development agents (p. 5).
The challenge is, however, to ensure the poor can access services, and that
services are useful. These include problems of access, high costs, lack of funding,
and/or low human skills (Scott et al. 2004). In his very complete literature review on
ICTs and poverty, Adeya (2003) argues that there has to be political will to achieve
some of these developments. Governments should develop new policies to position
mobile telecommunications networks as nationally important development tools.
Within a context where pervasive corruption, mismanagement, and spoliation by
African leadership are among the main reasons for the failure of development
programs in sub-Saharan Africa (Pratt 1993), it is not clear, however, the extent to
which it is in governments interest to promote such developments. Pye (1966, 156)
explains the reason for this suspicion:
The communication process thus gives form and structure to the
political process by surrounding the politicians on the one hand with
the constant reminder that political acts have consequences and that
people can have insatiable expectations of politics, and on the other
side with the warning that illusions of omnipotence are always
dangerous, even among people who have a casual understanding of
By emphasizing the mediating effect communication may eventually play in
bridging the supply (e.g., government) and demand (e.g., citizens) sides of the
institutional development process (e.g., political modernization, administrative and
legal development, political participation and representation, organization of civil
societies), Pye points to the potential (i.e., not guaranteed without proper political
will) role ICTs can play in national integration, national unity, and national image

credibility. At present, with two-way forms of communication, this occurs largely by
empowering individuals to participate in political institutions and policymaking of
their communities, and giving voice to those who have traditionally been excluded.
The Networked Readiness Index (NRI) is a world benchmark defined as a
nations or communitys degree of preparation to participate in and benefit from ICT
developments. The NRI is a composite indicator which includes three main
dimensions. Each one of them can be broken down into several sub-indexes: (i) the
networked readiness/capability of developers and users (e.g., individuals, businesses,
and governments) to benefit from ICTs; (ii) the general macroeconomic and
regulatory environment for ICTs in which the stakeholders play out their respective
roles; and (iii) the degree of usage of ICTs by the three stakeholders. In 2004,
Mozambique ranked 97th out of 102 nations with a score of 2.51 out of 7 (the U.S.
ranked 1st with a score of 5.50).
The sub-indexes related to the economic and regulatory environment in the case
of Mozambique systematically outperform business and individual-related indicators
of accessibility and usage (see Appendix C for the complete rankings for
Mozambique). Moreover, government-related indicators of usage are much higher
than for individuals (Dutta et al. 2004). These findings reinforce the idea of the very
strong influence of government in the Mozambican society, as had been already
captured with data from the Heritage Foundation and the Freedom House.
Assessing the potential of using ICTs in achieving the MDGs, Lanvin and Qiang
(2004) argue that a prerequisite for success is that people be aware of the possibilities
that ICTs offer in traditional development sectors such as education, good

governance, and professional settings (e.g., social habits, agriculture). Only then will
it be possible for ICTs to make significant contributions to economic growth by
means of increasing labor productivity (Qiang et al. 2003). In order to reach the
targets set by the MDGs, countries can either increase the resources they allocate to
specific objectives, or increase the efficiency with which they use their available
H2: Increased access to ICTs favors retention of HSRs.
Government, Institutions, and Rules in Place
Central to this thesis is the relationship between the very scarce resources
available for extremely impoverished governments, their legislators intentions and
priorities, and the HSRs needs (e.g., transaction costs, incentives, solutions). As
stated earlier, a key aspect is the relationship between institutional supply (e.g.,
government programs) and HSRs demand for programs. Olsen (2001) highlights the
criticality of this supply-demand dynamics when suggesting a better understanding of
the role of human intention, reflection, and choice in the development of political
institutions and good government (p. 195) and the study of the environmental
effectiveness in eliminating suboptimal institutions (p. 196). For instance, in a study
on Ghana and the Ivory Coast, only 30 percent of the HSRs were aware of
government programs to promote return, and just six percent could actually name one
(Black et al. 2003). Basically, Olsen reinforces the following: (i) human strategic
intention to change institutions counts; (ii) governments can and should have the

initiative of promoting such changes; and (iii) there is a way to measure institutional
(in)efficiency (also see Iredale et al. 2003, Acemoglu 2005).
Patinkins (1968) Nationalist Model also emphasizes the interconnection
between governments role and their most well-educated citizens for the development
process of nations: (i) to encourage trained personnel to identify with the
development of the country; (ii) to show that these people can fulfill a vital role in
that development; and (iii) to provide minimally for them to fulfill their professional
and scientific aspirations.
Specifically about HSRs, Saxenian (2006, 326-327) states: [tjhey engage
policymakers on policies to improve the local environment for entrepreneurship....
Governments have invested in education, research, and infrastructure in some cases
with the active guidance of the returnees. Saxenian also argues that HSRs are ideally
positioned to work with domestic policymakers to identify strategies to overcome
obstacles to further growth (p. 16). Saxenian continues that HSRs contribute to the
transformation of domestic institutions by advising national governments on legal,
regulatory, and capital market reforms, by working with regional governments on
improving local infrastructure, universities, research, and training institutions (p.
20). This is what Saxenian calls a process of collaborative institution-building (p.
335). Saxenian cautions, however: returnees have difficulty locating the managerial
and technical expertise, as well as the market relationships, needed to build a new
company (p. 334). Even though the Saxenian approach is one of viewing
institutional change as a dependent variable of HSRs and this thesis examines the
opposite (i.e., the return and retention as a function of the institutional setting), what

is being highlighted here is the role government can play not only in shaping
conditions in the home country but also in prioritizing interventions based on lessons
from HSRs life experiences (i.e., patterns of reintegration)
Although PARPA II: 2006-09 calls to [h]elp youth realize their potential, their
creative and entrepreneurial abilities, and participate in society (Mozambique 2005,
32), no government-created public policy for retention of HSRs has actually been
implemented. A Mozambican senior public official puts it this way: there is neither
attraction nor retention policies, people return for love of the country (Personal
interview, December 2009). The only active and continuing public policies in
Mozambique to promote HSRs retention have been sponsored by the International
Organization for Migrations (IOM) (2000; 2005). Traditionally, these programs
stressed the systematic return of migrants. Recent versions try to encourage mobility
of people and resources (IOM 2002).
According to the IOM, 92 percent of the countries possess policies and programs
targeting their diasporas abroad for home country development purposes (IOM 2005).
The IOM has implemented return of talent program for several regions: Africa
(Return of Qualified African Nationals [RQAN]), Latin America (Reintegration of
Qualified Latin American Nationals [RQNLA]), and the Return of Talent Program in
Jamaica, among others. Specifically related to this thesis, IOM established the RQAN
program in 1983, with the objective of mobilizing and promoting the utilization of
highly skilled personnel in the development of African countries through voluntary
migration (IOM 2000). The RQAN is currently used by ten African governments
(Mozambique not included) and has succeeded in the return and integration of 1,500

skilled Africans to fill positions in important sectors of the economy. This program
defines skilled as a person with at least two years of work experience and/or a
Ph.D. IOM has now replaced this program for Africa with MIDA. The major
difference is that it no longer stresses the systematic return of migrants, but instead
tries to encourage mobility of people and resources (IOM 2002). Services provided
by MIDA include return airline tickets for the candidate and any dependents,
shipment of personal effects, purchase of some professional equipment or materials,
some settling-in expenses, modest interest-free, and reimbursable loan for those
candidates who will be self-employed.
The policy shift from a focus on return to a focus on circulation can be
understood by the theoretical movement from a focus on transaction costs of the
(single) return, typical in the neoclassic, the new economic, and the structuralist
approaches to return migration, to a focus on recognition of merit and value in ones
mobility (i.e., multiple returns), which is typical in the transnationalist and social
networks approaches to return migration. Nevertheless, from a return migration
theoretical point of view, the problem with the traditional focus on monetary
transaction costs is that it ends up being an incentive only for those highly skilled
citizens that had already decided to return anyway (i.e., it supports the return of those
that had already decided to return regardless, but it does not influence the decision to
return). For instance, the neoclassic migrant is either successful, and the HSRs
initiative does not compensate enough for the return, or s/he is unsuccessful, and will
return anyway. A focus on mobility is more about the creation of lasting institutional
conditions (i.e., as opposed to discrete financial supports) allowing the circulating

highly skilled citizen to include his/her home country in his/her life projects, such as
equivalency/certification of degrees/diplomas obtained abroad, access to professional
and political networks in the home country, facilitating remittance transfers, flexible
visa policy for foreign spouses, access to credit, and diaspora participation. Most
importantly, reaching out to highly skilled Mozambicans (HSMs) abroad and building
trust among these groups seems to be a precondition for enhancing the role of the
Mozambican diaspora in development.
In addition to the efforts to organize, attract, and retain skilled citizens, there are
many Internet-based social and job information networks that specialize in sciences
and engineering. These non-government organizations build upon the older
experience of the UNDPs TOKTEN program and the South African Network of
Skills Abroad (SANSA). Other organizations bridge home countries with their
diasporas abroad as in the cases of the Association of Kenyans Abroad, the Moroccan
Association of Researchers and Scholars Abroad, the Association of Nigerians
Abroad, and the Tunisian Scientific Consortium (Brown 2000; Wickramasekara
H3: Increased access to governmental programs favors retention of HSRs.
Supported by the literature reviewed, H3 focuses on education and
job/profession/entrepreneurship-related governmental programs only. These are
viewed here as examples of formal rules in place (i.e., the third and last
contextual/explanatory factor remaining to be considered). Public expenditure on

service delivery in Mozambique has risen rapidly since its independence, and total
government spending has been about 25 percent of GDP. In the mid-1990s, after the
end of the civil war and with the first elections, a critical government challenge was
to use public resources to reach millions of households neglected throughout the years
of conflict. The strategy adopted was to allocate a large share of its budget (including
donor funds) to public service delivery, such as education, health, and welfare (WB
2007). Since then, the government focus has been on improving quantity of services;
for the most part the money has been used to build infrastructure. The government
commitment to infrastructure projects tripled from 2002 to 2008, being in 2008
equivalent to 5.2 percent of the GDP.
This rapid growth in infrastructure has posed management challenges to
government efficiency, such as procurement, costs of maintenance and oversight, lack
of qualified human capital for management, and decentralization of decision-making.
Furthermore, Mozambiques administrative performance on accountability and
transparency in the public sector, on rule of law, and on control of corruption still
remains weak. For instance, as described in the previous chapter, government size has
persistently remained large. Related to this, and according to the WBs (2009a)
worldwide governance indicators, government effectiveness is, among six other
indicators, the one where Mozambique ranks the lowest. Perception data show that
failures at this level show up not only in the lack of access to services but also in the
lower productivity at work and, overall, in a less satisfactory life (WB 2007).
Hypothesis H3 is particularly relevant to assess whether some programs should

continue to consume a share of the very scarce resources available to Mozambican
In a single sentence only, Castel-Branco (1995, 597) highlights the relevance of
all three hypotheses proposed above when listing the weaknesses of its institutional,
human, and technologic capacity as one of the four main structural problems of the
organization of life in Mozambique.
Urban Bias, Rural Development, and Contextual Factors
Even though institutions and other contextual factors affect behavior, they may
not do it so uniformly both in urban and rural areas. Mamdani (1996) and Boone
(2003) argue that institutional outcomes are the results of a large number of historical,
cultural, social, and geographic particularly urban and rural determinants, usually
incompatible with the imposition of politico-administrative top-down models. Boone
argues that the source for differences between urban and rural settings, in particular in
what relates to regional variation in the political capacities and interests of rural
societies and rural leaders, lie in the institution-building strategies chosen by
governments trying to secure their own rule over the countryside. This perspective is
called the theory of urban bias (Lipton 1977; Bates 1993; Mamdani 1996;
Brinkerhoff and Crosby 2002) and seeks to explain the way colonialism divided
Africans across urban (citizen) and rural (subject) lines and how this division has
persisted into the post-colonial period.11 11
11 Moore (1966) develops a similar theoretical formulation to explain the transition of
Western societies from an agrarian economic system to a modem industrial capitalist

In particular, the urban bias perspective addresses one reason why post-colonial
Africas agricultural policies have been so poor, how this poverty kept productivity
low and prevented the emergence of a meaningful mercantilist class, and ultimately
why African development has failed. First, colonization left a heritage of
disproportionally centralized institutional bodies (e.g., politics, markets, trade centers)
in the main cities. As a result, there is a disproportional (i.e., biased), concentration of
political and economic power in the cities (Lipton 1977; Bates 1993). This situation is
then reinforced by governments more interested in keeping urban food prices down
than in paying farmers full prices for their crops, because of their worry with urban
dwellers overthrowing their regimes (Boone 2003). Even though governments usually
respond to their constituents, many African countries have been ruled by force,
dictatorship, and/or single-party systems that weaken the possibility of broader
democratic participation and accountability. The result is a great flow of people from
rural to urban areas in the hope of better economic, social, and political conditions in
the main metropolis than in rural communities. This further weakening of rural
communities promotes desertification of lands, further strengthens urban protective
policies, and pressures urban carrying capacity.
Chambers (1983) adds that the international system of knowledge and prestige,
with its rewards and incentives, draws professionals away from rural areas and up
through the hierarchy of urban and international centers. Increasingly impoverished
and less empowered rural communities have seen their levels of solidarity, trust, and
moral values undermined. While these demographic trends could be comparable to
what happens in modernized countries, these have specific institutional arrangements

to encourage populations to remain in their rural settlements, such as the Common
Agricultural Policy in the European Union (EU) and the Agricultural Adjustment Act
in the U.S.
Mamdani (1996) argues that the state-versus-society approach in African studies12
has not paid enough attention to political tensions and conflicts within rural areas and
between rural and urban areas. Particularly, a research gap exists on how state
authority has been diffused in patterns of village politics and unevenness of power
distribution between regions. In his words the driving force of democratization
everywhere is the contention between civil society and the state (pp. 13-14). In his
conclusion, he asks [w]hat social forces can link the urban and the rural? (p. 297).
Boone proposes a political-economy framework in rural Africa that highlights
regional variation in the political capacities and interests of rural societies and rural
leaders. She argues that these differences should be seen as independent variables that
explain the strategies chosen by governments trying to secure their own rule over the
countryside. De Walle (2002, 79), referring to the African democratization process,
concurs with Boone, political outcomes will depend on what important individuals
think, do, and say.
While a look into some key Mozambican infrastructures serves the purpose of
illustrating these theoretical discussions, the empirical data available supports the
hypothesis that infrastructure per capita is still much higher in urban coastal areas
than in rural ones (see Table 3 and Figure 2). 1
1 9
An approach that traditionally has been focused on the emergence of unprecedented
state power, claiming competence over ever greater domains of human life versus the
rise of a self-assertive "society", aiming to liberate the individual from traditional
moral, social, and political restraints.

Table 3: Urban vs. Rural Infrastructures in Mozambique
Pop. Covered (%)
Infrastructure Urban Rural
Use of safe water 64 27
Sanitation 72 33
Electricity 22 0
Health (< 30' health post) 68 21
Education (enrolled 7-12) 82 65
Source: Mozambique (Census 2003)
* *.*
Fig. 2 : Mobil Communications Network Coverage in Mozambique
Source: Muchanga (2008)
Spending follows the infrastructure, therefore spending inequities persist. As a
result, urban areas residents are more satisfied with government services because they
have much better infrastructure and quality of services (Mozambique 2003; Briick
and Van den Broeck 2006). In spite of the decentralization efforts, namely with the
extension to rural areas of the Law for Local State Bodies in 2003 (e.g., a high
percentage of expenditures go out of Maputo to rural areas for infrastructure
construction, such as schools, roads, and water points, equipment and supplies,
personnel costs), the size of the Mozambican central government persists being very

large. The biggest challenge, therefore, for both rural and urban poverty reduction and
welfare improvement is the development of a more efficient and effective state
(Mo9ambique 2003). This is widely recognized, and PARPA II articulates a
comprehensive program to address this issue.
H4: Factors affecting the retention of HSRs differ from urban to rural areas.
Overall, the hypothetical no rejection of this hypothesis, and the consequent need
to impact the catch-up of services delivered in both types of settings, is particularly
critical within the context of the Mozambican construction as it was discussed in the
previous chapter, Traits of a Mozambican Identity. The risk of ethnic divisions and
conflicts associated with perceptions of discrimination in access to and benefit of
certain resources may threat the integrity and development process of the very recent
Mozambican democratic system (Sen 1981).13
13 For example, Castel-Branco (1995) explains that Mozambican peasants are paid for
the raw materials they supply to industries and national exports at a price lower than
its social cost, on average roughly not above 20 percent of its international price. This
happens for two reasons. First, within the subsistence logic of rural families
production satisfies most of their needs (e.g., food, basic housing, coal), which in turn
reduces social pressure on salaries. Second, rural labor is so unqualified and in such a
high supply that urban-ran industries have no difficulties in keeping wages and their
input costs low.