Ideas to Action:

Independent research for global prosperity

Publications

 

December 4, 2006

Payments for Progress: A Hands-Off Approach to Foreign Aid - Working Paper 102

The aid business has long grappled with the trade-off between showing results and supporting a country's own institution-building. Donors want to be sure that their money makes a difference, and often quickly. But close monitoring raises costs and pushing for quick results leads to projects that bypass or even undermine domestic institutions that are crucial to development. In Payments for Progress: A Hands-Off Approach to Foreign Aid, Owen Barder, now director of Global Development Effectiveness at the United Kingdom Department for International Development, and CGD president Nancy Birdsall propose solving this problem by having donors pay for proven progress towards such agreed goals as additional children completing school and additional kilometers of roads built. How to achieve these goals would be left to the aid recipient government. They suggest this approach may be particularly useful in fragile states. Learn more

August 14, 2006

Fragile States and U.S. Foreign Assistance: Show Me the Money - Working Paper 96

Analysis of the U.S. budget reveals a chasm between Washington rhetoric about the potentially large threats arising from weak and failing states and the paucity of resources devoted to engaging with these troubled countries. The authors argue that the U.S. should think creatively about how and when to engage and should boost the $1.1 billion requested for these countries in the 2007 budget, regarding it as a form of venture capital, with high risks but potentially high rewards. Learn more

Stewart Patrick and Kaysie Brown
July 24, 2006

A Primer on Foreign Aid - Working Paper 92

Controversies about aid effectiveness go back decades. This new working paper by CGD senior fellow Steven Radelet provides an introduction and overview of the basic concepts, data and key debates about foreign aid. It explores the range of views on the relationship between foreign aid and economic growth and discusses the reform of foreign aid, including selectivity, country ownership, the participatory approach, harmonization and coordination, and results-based management.Learn more

July 11, 2006

A Policymakers' Guide to Dutch Disease - Working Paper 91

It is sometimes claimed that big surges in aid might cause Dutch Disease--an appreciation of the real exchange rate which can slow the growth of a country's exports--and that aid increases might thereby harm a country's long-term growth prospects. In this new working paper CGD senior program associate Owen Barder argues that it is unlikely that a long-term, sustained and predictable increase in aid would, through the impact on the real exchange rate, do more harm than good. Learn more

July 6, 2006

Are the planned increases in aid too much of a good thing? - Working Paper 90

Donor countries have pledged to increase aid by 60 percent over the next five years, and larger increases would be needed to meet the Millennium Development Goals. Can developing countries use more aid effectively? In this new working paper, CGD senior program associate Owen Barder argues that the obstacles to effective use of significantly increased aid can be overcome by a small number of practical improvements in how aid is provided and used. Learn More

June 26, 2006

Competitive Proliferation of Aid Projects: A Model - Working Paper 89

When aid projects proliferate, donors often seek better oversight through smaller projects. While this may improve administration, it burdens recipient governments with reporting requirements and donor visits. CGD research fellow David Roodman suggests in a new working paper that big projects are best for countries that get more aid, have better governance, or have less revenue. He also shows how donors who care most about their own success tend to divide their aid portfolios into more, smaller projects to draw the recipient's resources away from other donors. This reduces development.Learn more

January 11, 2006

Aid Project Proliferation and Absorptive Capacity-Working Paper 75

At a time when the international dialogue surrounding development is focused on increasing the quantity of aid, this paper focuses on how each dollar of foreign assistance can be more effective in reducing poverty. Using a sophisticated mathematical modeling process, the author explores the phenomena of project proliferation and absorptive capacity in foreign aid delivery.

January 10, 2006

An Aid-Institutions Paradox? A Review Essay on Aid Dependency and State Building in Sub-Saharan Africa- Working Paper 74

Does foreign aid help develop public institutions and state capacity in developing countries? In this Working Paper, the authors suggest that despite recent calls for increased aid to poor countries by the international community, there may be an "aid-institutions paradox." While donor intentions may be sincere, the authors conclude that it is possible that aid could undermine long-term institutional development, particularly in sub-Saharan Africa.

Todd Moss , Gunilla Pettersson and Nicolas van de Walle