Book excerpt: This reports the result of an investigation into the social, economic, political, and institutional factors that encourage or impede inclusive economic development in Kiribati and hamper the capacity development needed to overcome obstacles to that development. Much of the information on which this report is based was collected in discussions in South Tarawa in January and April 2007. The institutional analysis and development framework of Ostrom et al (2001) served as the analytical framework for the investigation. This framework, which was developed by researchers from the Workshop in Political Theory and Policy Analysis at Indiana University in the United States, is an effective way to explain group behavior that influences a country's economic development.