Rural Water Management in Africa: The Impact of Customary Institu ...

Organizations are groups of people bound together by a common purpose of achieving certain shared objectives. They include political, economic, social, and educational bodies.²³ Institutions are codes of conducts and rules that are used by these bodies to define practices, assign roles, and coordinate interaction within and among them.²⁴ These rules originate from customs and laws or relationships in a community, and can be formal or informal.

“Formal institutions” refers to rules that are observable through written documents and are executed through formal positions or authority. These include constitutions, statutes, ordinances, laws, bylaws, property rights, and other governmental regulations. Pejovich points out that informal institutions determine the political system (the governance structure and individual rights), the economic system (property rights and contracts), and the enforcement system (the judiciary and the police). Hereafter, the formal institutions will be referred to as “statutory institutions.” The enforcement of formal rules by the government is carried out through the use of sanctions such as fines and imprisonment.²⁵

“Informal institutions” refers to unwritten social norms and codes of conduct based on implicit social understandings.²⁶ They include the community’s perceptions, the accumulated wisdom and knowledge of past events, and a current set of values. Informal institutions are the part of a community’s heritage or culture that is maintained and transmitted from one generation to another through imitation, oral tradition, and teaching.²⁷ Examples of informal institutions include sanctions, taboos, traditions, cultural norms, beliefs, values, social networks, kinship ties, and codes of conduct.²⁸ Informal rules are enforced through the use of sanctions such as fines, expulsion from the community, ostracism by friends and neighbors, or loss of reputation.²⁹ Ostracism is defined as a social form of rejection and exclusion whereby disapproved individuals are excluded from interaction with a social group.³⁰ Hereafter, the informal institutions will be referred to as “customary institutions.” These methods of customary law enforcement contrast starkly with the methods used to enforce statutory laws. This difference has a strong bearing on the degree of compliance and cost of enforcement.