Chicken-and-Egg Fallacy of Development

Term

Chicken-and-Egg Fallacy of Development

Idea level

Others / circular reasoning problem

Definition

The chicken-and-egg fallacy of development refers to a circular reasoning problem in which economic growth is said to require good institutions, while good institutions are said to require economic growth. Yuen Yuen Ang argues that this problem is analytic rather than empirical: it arises when an inherently endogenous (bicausal) development process is forced into linear, static models unsuited to its inherent qualities.

Sources

First formal articulation (conceptual diagnosis):

• Ang, Yuen Yuen. “Adaptive Political Economy: Toward a New Paradigm.” World Politics (2024).

Earlier articulation:

• Ang, Yuen Yuen. How China Escaped the Poverty Trap (2016), Introduction, Chapter 1, Conclusion (p. 243-247)

• Ang, Yuen Yuen. “Do Weberian Bureaucracies Lead to Markets or Vice Versa? A Coevolutionary Approach to Development.” Chapter in States in the Developing World. (2017)

Genealogy

[Paradigm] Industrial–Colonial Paradigm

→ [Pillar] Mechanical thinking (linear causality)

→ [Concept] Chicken-and-egg fallacy of development

→ [Application: Development] Three schools of thought, all leading to theoretical dead ends: “growth first,” “good institutions first,” or “good historical legacies first”

Contrast with

[Paradigm] AIM (Adaptive, Inclusive, Moral Political Economy)

→ [Pillar] Adaptive Political Economy (APE)

→ [Theory] Coevolutionary development

→ [Method] Mapping endogenous, bicausal processes over time

→ [Application: Development] First step of development is “using what you have”

Quotes

This logic then becomes entangled in a chicken-and-egg problem of how we can obtain strong institutions if growth is lacking in the first place… My comparative analysis of coevolutionary paths across contexts points to a way out of vicious cycles of poverty and weak state capacity: make creative use of whatever is available.

- Ang, How China Escaped the Poverty Trap (2016), p. 243

“Despite a dazzling concentration of intellectual prowess, all three schools failed to find a way out of the chicken-and-egg problem. Why? Because they took an inherently endogenous (bicausal) process—economic and institutional development—and forced it to fit within their linear, static models.

- Ang, Adaptive Political Economy (2024)