A CRITICAL REVIEW OF THE CAPABILITY APPROACH IN

Centre for Aboriginal Economic Policy Researchdiscuss the use of freedom, agency and pluralism bycapability scholars, before going on to examine howthese three concepts have been interpreted differentlyin contemporary Australian Indigenous policy. Whatfollows illuminates how such different interpretationshave led to very different sets of policies. By highlightingthe conflicting interpretations, I aim to enable a moreaccurate application of the capability approach withinIndigenous policy in Australia.(Klein 2014), his commitment to process freedomsbeing at the heart of all processes of development andsocial change is significant. The proposition is that(Alkire 2008:29):social arrangements should be primarily evaluatedaccording to the extent of freedom peoplehave to promote or achieve functionings theyvalue. Put simply, progress, or development, orpoverty reduction, occurs when people haveSen’s notion of freedomWithin the capability approach, Sen defines freedom intwo distinct ways. Firstly, he explains the usefulness ofexpanding human freedoms through opportunities or the‘substantive freedoms’ (Sen 1999:3) that the membersof a society enjoy. Secondly, Sen defines freedomthrough empowerment and agency, which he calls‘process freedoms’ (Sen 2002:625). Process freedomsare the freedom for people to undertake initiatives theyvalue—it requires their agency. Process freedoms areimportant because they ‘enhance the ability of people tohelp themselves and also to influence the world, thesematters are central to the process of development’(Sen 1999:18). Sen also considers agency and systemicprocess freedoms such as public deliberation, and civiland political liberties to be central in creating socialchange, where the process of achieving such freedomshas intrinsic importance, independent of the outcome.Through defining freedom in these two distinct ways, thedistinction between achievement of outcomes and abilityto achieve outcomes becomes clearer. In the capabilityapproach, the means are just as important as the ends ofdevelopment and related policies.AgencyOften, policy is reduced to include just the realisation offunctionings (outcomes or beings and doings, as used bycapability scholars). Sen’s addition of agency means thatthe process of policy is just as important as the outcome.Agency to Sen means that there is freedom for peopleto achieve particular outcomes if they are desired andvalued. Sen (1999:53) states, ‘the people have to be seen as being actively involved—given the opportunity—in shaping their own destiny, and not just as passiverecipients of the fruits of cunning development programs’.Agency is the ability to act on values or, as Sen puts it,‘what a person is free to do and achieve in pursuit ofwhatever goals or values he or she regards as important’(Sen 1985a:203).Although Sen uses a narrow definition of agency, focusingmainly on agency that is purposeful and goal directed2  Kleingreater freedoms.When thinking about Australian Indigenous policy, thekey question from the capability approach lens becomes,precisely, how free are Indigenous Australians to live thelives they value and have reason to value?According to Sen (1999), agency applies to action atboth individual and collective levels. The individual levelrefers to an individual acting on what they value or havereason to value. The collective level refers to democraticdeliberation, public reasoning and collective movements.Sen calls for participatory public deliberation as beingfundamental, and a ‘procedural rather than a normativeresponse’ (Alkire 2002:143). What this means is thatinstitutions and structures need to be procedurally just,and not solely outcome focused. Consequently, there isa clear divergence between the capability approach andneopaternalistic policies within Australian Indigenouspolicy. The capability approach maintains that theprocess of policy is just as important as the outcome.PluralismHuman diversity is a driving force behind Sen’s initialwork on inequality. Following this, capability scholarsmaintain that processes of development should beplural and never uniform or predetermined, overridingthe needs of differing cultural and social contexts (seeSen 1995, Alkire 2002, Nussbaum 2011). In particular,Sen purposefully avoids articulating any specific set ofcapabilities, calling for the need for process freedomssuch as agency and public deliberation to help identifylists of capabilities for specific social milieus. Explicitly,Sen’s capability approach aims to only specify ‘a spacein which evaluation is to take place, rather than proposingone particular formula for evaluation’ (Sen 1988:18). ForSen, the whole notion of making value judgments bylisting important capabilities competes with the pluralismthat he values and defends.Notwithstanding, pluralism in the capability approachrests heavily on democracy, deliberative processes, andthe ability of groups and institutions to fairly compile lists.

caepr.anu.edu.auThe risk, of course, is that already marginalised voicesagain will be isolated in such a process. In the case ofIndigenous Australians, this is particularly poignant—it isprecisely the democratic institutions of settler society thathave continually colonised them (Wolfe 1999).Nussbaum takes a different approach to pluralism,whereby she argues that it is precisely because there is arisk that marginalised voices will be ignored by the widerpopulace in democratic processes that a broad list of10 universal capabilities must be identified. Nussbaum(2006) argues that her list of innate capabilities is broadenough to be relevant to all societies and cultures. Thelist includes the capabilities of life; bodily health; bodilyintegrity; senses, imagination and thought; emotions;practical reason; affiliation; other species; play; andcontrol over one’s environment. The applicability of sucha list, she argues, ‘isolates those human capabilities thatcan be convincingly argued to be of central importancein any human life, whatever else the person pursues orchooses’ (Nussbaum 2001:74). Yet Nussbaum, tryingto safeguard capabilities to ensure cultural and socialintegrity, and to ensure that the approach is as pragmaticas possible for policy makers, still risks paternalism(Deneulin 2002). By identifying what she sees as10 capabilities that are universally applicable, Nussbaumendorses a level of homogeneity within the capabilityapproach. This can be illustrated through the inclusion of‘practical reason’ as one of the universal capabilities. Thiscapability has strong roots in the western philosophicaltradition, and can exclude and compete againstother philosophies and world views (Robeyns 2003,Charusheela 2009).Furthermore, such a universal list brings up specificproblems relating to Indigenous justice in Australia.Altman (2009) illustrates the problems with universallists in Australian Indigenous policy by showing thatcreating lists runs the risk of privileging dominant andmainstream ideas of valuable beings and doings. Oneexample is the reduction of Indigenous wellbeing to anon-Indigenous set of socioeconomic indicators, asfound in current government policy frameworks. While auniversal list has pragmatic attractiveness and makes iteasy for policy makers to articulate specific capabilitiesto focus on, it would seem that Sen’s version of thecapability approach better reflects the ideals of agency,pluralism and freedom. Sen maintains that having auniversal list of basic capabilities misses the opportunityfor public deliberation and democratic process freedomsin compiling lists. This concerns Sen because, not onlyare the instrumental value and rights of those who willbe affected by the policy overlooked, so is the intrinsicvalue of including people in the processes affectingtheir lives (Sen 1999). Although many are sympatheticto Nussbaum’s approach, Sen’s version is most widelyapplied in development policy.Social structures, power andthe capability approachSen is not ignorant of the complexity between structures,culture and agency. He has written about the humanrights–based approach and the capability approachbeing mutually reinforcing (Sen 2005, 2009). Specifically,human rights can play a role in holding states andinstitutions to account by providing valued capabilitiesto the people they represent. For example, the UnitedNations Declaration on the Rights of IndigenousPeoples sets a standard to direct and hold democraticinstitutions in Australia to account. While many humanrights complement capabilities, in some cases processfreedoms in the achievement of such human rights canactually be overlooked (as some rights can be forcedon people). One such example of the possible tensionbetween the human rights approach and the capabilityapproach is the enforcement of the right to work,where people are coerced by welfare-to-work policiesinto employment.Although Sen has an implicit concern with power relationsand unjust social structures, caution must nonethelessbe used when applying collective process freedomssuch as deliberation and democracy. This is becauseunjust relations of power and social structures can bereproduced through collective process freedoms withouta full account and theorisation of societal structures,hegemony and power in the shaping of agency andsociety (Otto & Ziegler 2006, Zheng & Stahl 2011). Toput it differently, the racialised, liberal and economicconstitution of society tends to structure agents’ options,and hegemony acts to exclude other options (Gramsci1971, Laclau & Mouffe 2001). Critical social theories couldremedy such a dilemma and complement the capabilityapproach as they specifically focus on the structuralconditions of, and dialectic with, individual and collectiveagency. Moreover, critical social theory scholars focustheir research on how social structures and powerdynamics enable or restrict emancipation—that is,the discursive character of social structures that limitpersonal and collective freedoms (Zheng & Stahl 2011).Without such critical social theory, the pluralism andflexibility built into the capability approach ‘creates scopefor more casual and

The capability approach 1 Sen’s notion of freedom 2 Agency 2 Pluralism 2 Social structures, power and the capability approach 3 The use of the capability approach in Australian Indigenous policy 4 Human capability, not human capital 4 Deficit discourse and ‘lacking’ capabilities 4