Doing business under the framework of disorder: illiberal legalism in Indonesia

The rule of law has been widely perceived as an important prerequisite for economic development. However, many cases in postcolonial countries have shown that the two may not always be strongly related. Drawing from the case of Indonesia, we found that economic development can also be accompanied by a distinctly illiberal legal framework. Instead of being obstacles, legal uncertainty and lawlessness are in some ways instrumental in facilitating particular experiences of economic development, constituting the failure of legal reform. This means that illiberal legalism is not an exclusive characteristic of transitional states nor necessarily the result of a cultural feature of developing societies where multiple legal systems coexist. Rather, illiberal legalism is an outcome of a particular development of capitalism in some countries in the Global South where legal institutions work as an instrument of rule. While there is no single model of illiberal legalism, the Indonesian case represents an example where an illiberal politico-legal system coexists with a predominantly rent-seeking economy. The Indonesian case was analysed based on fieldwork conducted in Jakarta from December 2019 to January 2020 and secondary data collected until the time of writing.