Market system diagrams, or: how I learned to stop worrying and love the doughnut

Jake Lomax

doi:10.3362/1755-1986.20-00006

Market system diagrams, or: how I learned to stop worrying and love the doughnut

Doughnuts (aka market system diagrams) are central to market systems analysis, and to the way of thinking that seeks to investigate and address root causes of market system underperformance. But we rarely see them being used, and still less see them used well. Why is the defining framework of the Making Markets Work for the Poor (M4P) approach not used more, and why is it not used more consistently? This paper starts by getting under the hood of the doughnut to see what’s really going on in there and describes how it needs to sit alongside other M4P tools. It then details three common examples of doughnut-related malpractice and the real implications this has for our ability to deliver sustainable change at scale in market systems. Finally, the paper analyses the incentive and capacity constraints that prevent programmes making better use of doughnuts, and suggests how these may be addressed.

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