ABSTRACT
In fact, institution building is an essentially uncertain process and its relation to economic development in terms of causality is complex and interdependent. Generally a change in the economic structure is needed in order to create new institutions more than the other way around, but in practice economic activities and institutions co-evolve. This chapter discusses that the developmental/anti-developmental distinction developed by proponents of the Institutional Political Economy could be a more productive way to analyze the Cuban development strategy. Indeed, the excessive government centralization has been one of the problems of the Cuban economy. The Soviet legacy has become an obstacle because it has shaped the motivations and raison d’être of many important decision-makers and institutions in Cuba. From the industrial revolution in England to the American and German experience at the end of the nineteenth century, including again the Japanese, Finnish and the Taiwanese development experiences, it has been shown that institutional changes are, generally, politically legitimated processes.
