Accountability: Why the Sri Lankan Economy Collapsed and How to Revive it

Abstract

This paper argues that the root cause of Sri Lanka’s 2022 economic collapse lies not merely in recent missteps, but in long-standing policies that weakened citizens’ ability to hold their government responsible. Despite periods of strong growth and development, policies such as the Paddy Lands Act, poorly targeted energy subsidies, politicised cash transfers, and restricted higher education have eroded public oversight and led to economic inefficiencies. Through six key reform areas agriculture, energy, social protection, trade, education, and macroeconomic management the paper demonstrates how poor outcomes stem from the government being less accountable to its people. By tracing how policies that empowered citizens led to progress, and those that disempowered them led to failure, the paper provides a compelling case for rebuilding economic strength through institutional reforms that shift power back to the public.