Building bridges for more effective policies: MSD and the SOAS-ACE approach to political economy analysis

MSD has always done political economy analysis - we just don't always call it that.

Over the last six months, Luis Osorio-Cortes (Lucho) and I have been exploring the complementarities between Market Systems Development and the SOAS-ACE approach to understanding and navigating the political economy dynamics of policy implementation. This piece summarises the insights that have emerged from our explorations; a fuller version is available.

When we started out, our hypothesis was simple: MSD programmes could be more effective if they engaged more at the level of policy, informed by political economy analysis that shines a light on the drivers of actors’ behaviours and the feasibility of policy reform. We thought we might help by providing MSD practitioners with practical tools for conducting the sort of political economy analysis that the SOAS-ACE approach supports.

Informed by our initial note on market systems, policies and the risks of corruption, our conversations with MSD practitioners and political economy experts in September and October 2025, surfaced three clusters of insights that are now shaping our thinking:

1. Policy, political economy and positive deviance

On policy, political economy and positive deviance, the experts we spoke with confirmed aspects of our hypothesis - yes, MSD programmes have struggled with policy engagement, and yes, political economy analysis has not been applied consistently. But they also emphasised that making sense of complex systems and using that understanding to inform action is central to MSD practice, even when it isn't labelled as political economy analysis.

Our conversations also revealed interesting examples of programmes that have tried to incorporate these elements. And, they shed light on the reasons why that has been patchy, including donors' timeframes and focus on quick wins, MSD's tendency to operate at arm's length from policymakers, and the under-resourcing of policy work.

The conversations also helped us to realise that we're addressing two related but distinct challenges: the relative neglect of policy engagement, and the patchy application of political economy analysis, particularly of the forward-looking, action-oriented, behaviourally-focused variety developed by SOAS-ACE.

We also learned that it matters what sorts of policies we're talking about - sectoral policies, regulatory frameworks, or specific quality standards - because the nature and scope of the policy in question shapes the political economy dynamics of policy implementation.

2. Entry points, actors and users

On entry points, actors and users, initially, we thought broadly about supporting 'MSD practitioners' without distinguishing between different actors or considering where in the MSD process our work might be most useful. The conversations we had prompted us to refine our thinking. We were encouraged to focus on supporting programme managers and field staff specifically. But we were also reminded that these actors operate within what we might call an 'MSD-enabling system', comprising funders providing resources, programme designers conducting initial assessments, managers guiding implementation, and field staff navigating day-to-day challenges.

So in effect, while our explorations should focus on supporting particular types of actors - programme managers and field-level staff working in MSD programmes - they must also be informed by our own political economy analysis of the wider MSD-enabling system, understanding how actors, relationships, incentives, institutions and resource flows in that system constrain and enable behaviour in particular MSD programmes.

3. Listening, exploring and learning

On listening, exploring and learning, while our conversations confirmed that MSD practice might be enhanced by sharper political economy analysis, they challenged our assumptions about how practical knowledge should be generated.

In conversations that echoed SOAS-ACE's own emphasis on tailoring policies to particular contexts, we heard very clearly that we should avoid trying to impose a particular approach. We were encouraged to listen and learn from what MSD practitioners are already doing, to identify what's working well - positive deviance! - and to amplify and build on existing good practices.

We were also encouraged to see this as two-way learning. MSD's framing of poverty reduction and sustainable livelihoods as emergent outcomes of complex adaptive systems is, in some respects, ahead of much thinking and practice on governance and anti-corruption.

So while our primary focus is on enhancing MSD practice, governance and anti-corruption initiatives might also benefit from greater engagement with MSD.

4. Implications and next steps

Overall, these insights have made an important contribution to shaping our plans. Rather than developing tools to help MSD practitioners to deploy the SOAS-ACE approach to political economy analysis, we are now focused on collaborative learning - identifying what's already working, understanding the constraints within the MSD-enabling system that shape what's possible, and exploring whether aspects of the SOAS-ACE approach might enhance existing practice.

We think that the SOAS-ACE approach has much to offer, but finding a fit requires paying attention to the contexts in which MSD practitioners operate and the ways in which they work.

We are now developing a concept note that will outline plans for collaborative learning activities - identifying and analysing interesting cases, hosting conversations, and developing practical resources that build on existing practice. We will prioritise listening, not preaching.

Check out this longer piece for a fuller readout of our conversations, our reflections and the implications for our plans. And have a look at an annotated bibliography of pieces on Market Systems Development which informed our initial thinking.

If you're working in MSD and wrestling with policy engagement, or if you're a governance specialist curious about what MSD practice might teach us, we'd love to hear from you by commenting below and/or emailing us: Alan Hudson and Luis Osorio-Cortes (Lucho). We'd be particularly keen to be in touch if you've been involved with MSD programmes that have sought to inform and support policy change, or which have used political economy analysis to understand the dynamics of market systems, and to inform policy engagement.

_{Acknowledgements: We are very grateful to the following people who generously shared their experience and insights over the course of the last few months: Mike Albu, Ben Taylor, Mike Field, Margie Brand, David Jacobstein, Duncan Green, Kristin O'Planick, Ryan Bourque, Vivekan Jeyagaran, James Foster, Ellie Horrocks, Andrew Seward, Donna Loveridge, Tom Hilton, Rachel Leeds, Sasha Muench, Kamran Hakiman, and Mohammad Shahroz Jalil.}

_{This blog was originally posted by Alan Hudson on LinkedIn in December 2025}