The goal of Market Systems Development (MSD) programmes is to change systems so that they work better for poor, or otherwise disadvantaged, people. In practice, changing systems means changing the behaviour of people and organisations – market actors – within those systems.
To achieve this, MSD guidance encourages practitioners to analyse the incentives and capacities of different market players. If change is in a firm, government or individual’s own interest and abilities, it is more likely to last beyond the timeframe of the programme’s support, as well as to spread to other actors with similar incentives and capacities, thus achieving MSD’s dual aim of sustainability and scale.
Analysing stakeholder incentives and capacities enables programmes to:
- understand why the system currently operates as it does
- develop a realistic vision for change that will be sustainable and spread to scale
- identify specific partners who could have the incentives and capacity to stimulate that change
- decide what kind of support to offer those partners to catalyse behaviour change
The ‘will-skill’ framework has proved useful in this process, particularly for the latter two tasks of identifying partners and determining appropriate offers of support. However, its use over the last decade has highlighted several areas in which further guidance is needed. For example, MSD practitioners often overlook important incentives and capacities, focusing too much on financial factors and paying too little attention to factors like risk, familiarity or social cost. In-depth guidance on what ‘incentives’ and ‘capacities’ are and how they, in turn, enable or constrain behaviour change, is currently lacking in MSD frameworks.
Furthermore, as the ‘will-skill’ framework is intended for use with potential programme partners, MSD practitioners sometimes forget to analyse the desired behaviour changes their intended beneficiaries and any intermediaries may need to adopt. A detailed analysis of the blockers to behaviour change at every level of the strategic framework is important.
This paper addresses these gaps by breaking down incentives and capacities in greater detail. It then presents a tool – Actor Behaviour Change (ABC) Factors – which links actors’ resources and priorities to the characteristics of a behaviour change that the programme wants to stimulate, and which can be applied to any actor (partners, intermediaries or beneficiaries).
 The Springfield Centre, The Operational Guide for the Making Markets Work for the Poor (M4P) Approach, 2nd Edition, 2014, 24, https://doi.org/10.1007/s007690000247