A new social contract for the Middle East and North Africa

By EBRD  Press Office
@ebrd

A new social contract for the Middle East and North Africa

New episode of the EBRD podcast available for download

The latest episode of the Pocket Economics podcast looks at the new social contract for the Middle East and North Africa (MENA). What is the relationship between the powers that be and those they govern?  Did the uprisings that started in Tunisia and spread to several countries in the Arab world in 2010-11 come as a surprise to economists?

The ‘social contract’ is an idea that refers to the implicit agreement among members of a society that defines their relationship with each other and the state.

The EBRD’S Chief Economist Sergei Guriev and the World Bank’s Chief Economist Shanta Devarajan discuss how the idea of a social contract has been interpreted in the Middle-Eastern and North African countries.

Mr Devarajan highlights the particular characteristics of the social contract in the MENA region and explains how they affected the uprisings.

Mr Guriev notes that “the main frustration was coming not from the very poor or left behind, but rather from the educated middle class” and that “the current problem is to a great extent the legacy of not reforming the system for many years.”

But what is the way forward? How could be a new social contract?

“The state needs to promote competition in domestic markets, as a way of generating jobs and growth”, explains Mr Devarajan.