The channels through which policy reforms affect stakeholders run through institutions. Institutions are the formal and informal rules of the game that affect the behavior and incentives of stakeholders. Institutions determine the framework in which policy reforms may affect households and individuals, and are the main arenas in which stakeholders interact with one another. Changes in these institutions are themselves often the object of policy reforms. Also, many policy changes require particular organizations to play central roles in their implementation. In this regard, PSIA needs to consider:

• How institutions and interests mediate the impact of policy reforms
• How the analysis of markets and organizational structures reveals the necessary conditions for the benefits of interventions to reach the poor