"Inclusion" in the broad sense of access to, and participation in, public policy and services has been lacking in the majority of developing countries---whether authoritarian or democratic---due to highly skewed political, social and economic power structures. To understand why this tends to be the case, the dissertation provides a political economy model for understanding civil society, arguing that the evolution of civil society and its potential as a vehicle for inclusion are conditioned by the economic imperatives in place and the state prerogatives. More specifically, I question the extent to which the neoliberal model allows civil society to fulfill this role, by examining the impact of Social Funds (SFs), a key social policy institution created and promoted solely under the neoliberal model, on civil society in Egypt and Bolivia.I argue that neoliberalism severely limits the possibility of: citizenship construction, achieving development synergy between the state and civil society, or strengthening the latter. These limitations are structural, inherent to the neoliberal development model and the changes it has brought about economically and politically. The research shows how these changes have manifestations within the state, the economy and civil society and more specifically social policy. Just as important, there are limitations intrinsically grounded in the structures found in many developing countries, pre-neoliberal changes. Such structures, I argue, do not allow new institutions like SFs to push forward such an ideal three-way relationship among the economy, state and civil society. Rather than strengthening civil society and creating development synergy, SFs are shown to be just an attempt to give neoliberal policies a human face and subdue any potential for structural changes.More generally, by contrasting the dynamics of civil society under neoliberalism in a developing country with a democratic regime (Bolivia) with those of a soft authoritarian regime (Egypt). I argue that a dichotomous framework, which sees democracy as antithetically opposed to authoritarianism is not necessarily appropriate to the analysis of developing countries. The cases illustrate that the state and civil society, under two-different regime types, continue to share a number of similarities