From the Northern Triangle to Northern Europe: How Good Governance Can Rescue Central America

The Northern Triangle countries of El Salvador, Guatemala, and Honduras are stuck in “governance traps” in which economic informality, violence and insecurity, state capture and corruption, and a lack of state capacity limit their ability to meet the needs of their populations. The governance trap is defined as a path-dependent equilibrium in which weak states with contested authority fail to penetrate civil society and achieve self-sustaining economic growth, resulting in states that under supply political order and economic opportunity. This governance trap framework rests on several propositions. First, the state is an autonomous organization that has a monopoly over the legitimate use of force in a given territory. Second, the Northern Triangle countries have weak states due to their contested monopoly of violence and thus, improving their governance will require improving their Weberian stateness. Third, state capacity is a composite of the mix of activities pursued by the Northern Triangle countries (their “scope”) and their ability to penetrate civil society autonomously (their “strength”). Fourth, some strength-scope combinations are better geared toward promoting high-quality governance than others. Fifth, because institutions exhibit path dependence, successful reforms will likely require strong, multi-year long commitments. Sixth, it is possible to “get to Denmark” with the right set of reforms, political will, and timely help from international partners.