Working Paper Series

AidData’s working paper series contains over 30 pre-publication papers addressing the following areas: the causes and consequences of development finance; whether, when, and how data transparency and accountability initiatives lead to better decision making and improved development outcomes; and related research methods. The series is a forum where relevant papers and research findings can be disseminated more broadly to scholars, policymakers, and practitioners. The views expressed in AidData working papers are those of the authors and should not be attributed to AidData or funders of AidData’s work.

Fueling Conflict? (De)Escalation and Bilateral Aid

November 2016 | Working Paper 31

Authors:

Richard Bluhm, Martin Gassebner, Sarah Langlotz, Paul Schaudt

Abstract:

This paper studies the effects of bilateral foreign aid on conflict escalation and de-escalation. We make three major contributions. First, we combine data on civil wars with data on low level conflicts in a new ordinal measure capturing the two-sided and multifaceted nature of conflict. Second, we develop a novel empirical framework. We propose a dynamic ordered probit estimator that allows for unobserved heterogeneity and corrects for endogeneity. Third, we identify the causal effect of foreign aid on conflict by predicting bilateral aid flows based on electoral outcomes of donor countries that are exogenous to recipients. We establish that the effect of foreign aid on the various transition probabilities is heterogeneous and can be substantial. Receiving bilateral aid raises the chances of escalating from small conflict to armed conflict, but we find no evidence that aid ignites conflict in truly peaceful countries.

Academic Citation:

Bluhm, Richard, Martin Gassebner, Sarah Langlotz, Paul Schaudt. 2016. Fueling Conflict? (De)Escalation and Bilateral Aid. AidData Working Paper #31. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Aid Management, Trust, and Development Policy Influence: New Evidence from a Survey of Public Sector Officials in Low-Income and Middle-Income Countries

September 2016 | Working Paper 30

Authors:

Bradley C. Parks, Takaaki Masaki, Jörg Faust, Stefan Leiderer

Abstract:

Bilateral and multilateral development agencies spend a great deal of time, money, and effort trying to shape the reform priorities and processes of their counterpart countries. However, the means by which development agencies can achieve these ends are poorly understood. This article draws upon the first-hand experiences and observations of more than 1,000 public sector officials from 70 low- and middle-income countries to better understand which external sources of reform advice and assistance are most and least useful to public sector decision-makers—and why. We find that donors more effectively shape reform priorities when they choose to deliver their funding through the public financial management systems of counterpart countries, rather than using channels of aid delivery—in particular, technical assistance programs—that bypass host governments and signal a lack of trust in the motivations and capabilities of the local authorities. This finding holds true even after controlling for institutional quality, or the trustworthiness of public sector institutions, in aid-receiving countries. As such, our results call attention to the fact that development agencies can amplify their policy influence by entrusting their counterpart governments with aid management responsibilities.

Academic Citation:

Parks, Bradley C., Takaaki Masaki, Jörg Faust, Stefan Leiderer. 2016. Aid Management, Trust, and Development Policy Influence: New Evidence from a Survey of Public Sector Officials in Low-Income and Middle-Income Countries. AidData Working Paper #30. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Repression and Foreign Aid in Autocracies: Exploiting Debt Relief Negotiations in Post-Cold War Africa

July 2016 | Working Paper 29

Authors:

Brett L. Carter

Abstract:

Does dependence on development aid from Western sources constrain the use of repression among autocrats? To answer this question, I employ a novel dataset of Africa’s post-Cold War autocracies in which the unit of analysis is the country-day rather than the country-year. This day-level dataset enables me to address three potential sources of bias that may obscure the relationship between Western aid dependence and repression. When the threat of financial sanction is credible, I find, Western donors have reduced the daily odds of repression in Africa’s post-Cold War autocracies. Western aid dependence is constraining even during periods of sustained popular protests. The results suggest that modern autocrats who rely on Western donors for financial support lack the easy recourse to repression enjoyed by their Cold War era predecessors.

Academic Citation:

Carter, Brett L. 2016. Repression and Foreign Aid in Autocracies: Exploiting Debt Relief Negotiations in Post-Cold War Africa AidData Working Paper #29. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Do Domestic Politics Shape U.S. Influence in the World Bank?

July 2016 | Working Paper 28

Authors:

Erasmus Kersting and Christopher Kilby

Abstract:

This paper investigates whether U.S. presidential administrations choose to exert more influence over international financial institutions when they have less control over bilateral aid because of a divided U.S. government. Reexamining four empirical studies of the World Bank, we demonstrate that findings of U.S. influence are driven by the years in which the U.S. government was divided. This provides a richer picture of when and why the U.S. exerts influence in multilateral settings and an alternate explanation to persistent questions about the role of international organizations in the political economy.

Academic Citation:

Kersting, Erasmus and Christopher Kilby. 2016. Do Domestic Politics Shape U.S. Influence in the World Bank? AidData Working Paper #28. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Tangible Information and Citizen Empowerment: Identification Cards and Food Subsidy Programs in Indonesia

June 2016 | Working Paper 27

Authors:

Abhijit Banerjee, Rema Hanna, Jordan Kyle, Benjamin A. Olken, Sudarno Sumarto

Abstract:

Local officials in developing countries do not always implement programs as the central government intends, often due to corruption. Directly informing citizens about their rights may result in citizens receiving more, but whether this occurs in practice is ultimately an empirical question. In an experiment in over 550 villages, we test whether mailing cards with program information to targeted beneficiaries increases the subsidy they receive from a subsidized rice program. On net, beneficiaries received 26 percent more subsidy in card villages. Ineligible households received no less, so this represents substantially lower leakage.

Academic Citation:

Banerjee, Abhijit, Rema Hanna, Jordan Kyle, Benjamin A. Olken, Sudarno Sumarto. 2016. Tangible Information and Citizen Empowerment: Identification Cards and Food Subsidy Programs in Indonesia. AidData Working Paper #27. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF) Appendix (PDF)

Update:

An updated version of this paper will be published in the Journal of Political Economy.

The Dragon's Curse? China, the World Bank, and Perceptions of Corruption in Tanzania

May 2016 | Working Paper 26

Authors:

Gina Kelly, Samuel Brazys, Johan A. Elkink

Abstract:

The rise of China as a “non-traditional” development partner has been one of the most important phenomenon in the field over the past decade but the implications of this emergence are not yet fully understood. The lack of transparency in Chinese aid programs, coupled with an apparently uninterested stance towards the governance implications of development, lead many to wonder if Chinese engagement will contribute to or undermine development efforts, particularly those of traditional donors such as the World Bank. This paper takes advantage of recent innovations in development aid data to investigate the spatial relationship between Chinese aid, World Bank aid and citizen perceptions of corruption in Tanzania. The paper finds a strong association between the location of a larger number of Chinese aid projects and higher perceptions of corruption. The paper also finds evidence that the presence of a large number of Chinese aid projects may undermine the “beneficial” relationship between World Bank aid projects and perceptions of corruption. However, both of these findings are qualified by the inability to disentangle the association with these aid projects from the association with similarly co-located natural resources, which may be an alternative driver of corruption via the “resource curse”.

Academic Citation:

Kelly, Gina, Samuel Brazys, and Johan A. Elkink. 2016. The Dragon's Curse? China, the World Bank, and Perceptions of Corruption in Tanzania. AidData Working Paper #26. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

What Determines Earmarked Funding to International Development Organizations? Evidence from the New Multi-Bi Aid Data

May 2016 | Working Paper 25

Authors:

Vera Z. Eichenauer, Bernhard Reinsberg

Abstract:

Earmarked aid to international development organizations has quadrupled over the last two decades and now represents almost twenty percent of total aid. This paper introduces a new dataset on earmarked aid, which alternatively has been referred to as multi-bi, restricted, non-core or trust fund aid. The data makes it possible to track the rise of the new aid channel over an extended period of time and in greater detail regarding, e.g., the implementing multilateral organizations. The data include more than 100,000 earmarked projects of 23 OECD donors to 290 multilateral institutions from 1990 to 2012. We graphically illustrate the distribution and patterns of this new aid channel for all actors involved, namely donor governments and their aid-providing agencies, multilateral organizations, and recipient countries, and highlight promising avenues for further research. In a first empirical application of the data, we analyze donors’ heterogeneous use of earmarked aid, and test three lines of argument for the provision of earmarked aid: official donor motives regarding specific recipient needs, public opinion in donor countries, and ‘market-oriented’ donor economies’ use of earmarked aid to ‘bypass’ recipient countries with weak governance. We show that earmarked aid is associated with different donor- and recipient-level factors than traditional or ‘pure’ bilateral aid.

Academic Citation:

Eichenauer, Vera Z. and Bernhard Reinsberg. 2016. What Determines Earmarked Funding to International Development Organizations? Evidence from the New Multi-Bi Aid Data. AidData Working Paper #25. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Foreign Aid and the Intensity of Violent Armed Conflict

May 2016 | Working Paper 24

Authors:

Daniel Strandow, Michael G. Findley, Joseph K. Young

Abstract:

Does foreign aid increase or decrease violence during ongoing wars? Although answers to this question are almost surely found at local levels, most research on this topic is performed at much higher levels of analysis, most notably the country level. We investigate the impact of foreign aid on the intensity of violence during ongoing armed conflict at a microlevel. We examine the influence that concentrated aid funding has on political violence within war zones that are contested among combatants. Using new geographically coded data within a matching design, we find that multiple measures of funding concentration are associated with increased military fatalities, but not with civilian fatalities.

Academic Citation:

Strandow, Daniel, Michael G. Findley, and Joseph K. Young. 2016. Foreign Aid and the Intensity of Violent Armed Conflict. AidData Working Paper #24. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF) Appendix (PDF)

Elite and Mass Support for Foreign Aid Versus Government Programs: Experimental Evidence from Uganda

April 2016 | Working Paper 23

Authors:

Michael G. Findley, Adam S. Harris, Helen V. Milner, Daniel Nielson

Abstract:

Does foreign aid enable or constrain elite capture of public revenues? Building on prominent debates in the foreign aid literature, we examine whether recipient preferences are consistent with a view – called here donor control theory – that foreign donors wield substantial control over the flow of aid dollars, making elite capture more difficult and mass benefits more likely. We compare elite and mass support for foreign aid versus government spending on development projects through a survey experiment with behavioral outcomes on members of the Ugandan national parliament and a representative sample of Ugandan citizens. For two actual aid projects, we randomly assigned different funders to the projects. Significant treatment effects reveal that members of parliament support government programs over foreign aid, whereas citizens prefer aid over government. Donor control theory also implies that citizens should favor foreign aid more and elites less as their perceptions of government clientelism and corruption increase. We explore this and report on other alternative mechanisms. Effects for citizens and elites are most apparent for those perceiving significant government corruption, supporting donor control theory.

Academic Citation:

Findley, Michael G., Adam S. Harris, Helen V. Milner, and Daniel Nielson. 2016. Elite and Mass Support for Foreign Aid Versus Government Programs: Experimental Evidence from Uganda. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF) Appendix (PDF)

Indigenous Land Rights and Deforestation: Evidence from the Brazilian Amazon

March 2016 | Working Paper 22

Authors:

Ariel BenYishay, Silke Heuser, Daniel Runfola, Rachel Trichler

Abstract:

Concerns over the expropriation of and encroachment on indigenous communities’ lands have led to greater formalization of these communities’ rights in a number of developing countries. We study whether formalization of indigenous communities’ land rights affects the rate of deforestation in both the short and medium terms. Beginning in 1995, the Government of Brazil formalized the rights of several hundred indigenous communities whose lands cover more than 40 million hectares in the Amazon region and provided support for these rights’ enforcement. We study the program’s impacts using a long time-series of satellite-based forest cover data. Using both matched samples of treated and comparison communities and plausibly exogenous variation in the timing of formalization, we find no effect of these protections on satellite-based greenness measures. This is true even for communities that received support for surveillance and enforcement of these rights. Notably, we observe low counterfactual rates of deforestation on communities’ lands between 1982 and 2014, suggesting that indigenous land rights programs should not uniformly be justified on the basis of their forest protection, at least in the medium term.

Academic Citation:

BenYishay, Ariel, Silke Heuser, Daniel Runfola and Rachel Trichler. 2016. Indigenous Land Rights and Deforestation: Evidence from the Brazilian Amazon. AidData Working Paper #22. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Putting Money to Mouths: Rewarding and Punishing Human Rights Behaviors

March 2016 | Working Paper 21

Authors:

Darren Hawkins, Jay Goodliffe

Abstract:

Do foreign aid donors reward recipients for good human rights and democracy records? In contrast to previous studies, we argue that donor states are interested in reproduction, influencing recipient states to adopt domestic practices similar to their own. This theory of donor behavior produces different hypotheses than those previously tested. In particular, we expect that aid donors will reward changes in a recipient’s level of democracy or respect for human rights that bring the recipient closer to the donor. Once recipients become more similar to donors, however, donor states allocate their resources away from those similar states. This is because donors prefer to utilize scarce resources to reward recipients who are actively changing in ways that bring them closer to donors. We find that recipients who change to become more like donors receive significant increases in aid while recipients who are already similar to donors receive large decreases in aid.

Academic Citation:

Hawkins, Darren and Jay Goodliffe. 2016. Putting Money to Mouths: Rewarding and Punishing Human Rights Behaviors. AidData Working Paper #21. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

The Impacts of World Bank Development Projects on Sites of High Biodiversity Importance

February 2016 | Working Paper 20

Authors:

Graeme M. Buchanan, Bradley C. Parks, Paul F. Donald, Brian F. O'Donnell, Daniel Runfola, John P. Swaddle, Lukasz Tracewski, and Stuart H.M. Butchart

Abstract:

The impacts of international development projects on biodiversity are poorly documented, yet many areas of biodiversity importance are potentially affected by such efforts. We assessed the impact of World Bank development projects on sites of biodiversity significance (Important Bird and Biodiversity Areas; IBAs) using remote sensing derived forest change data and in situ monitoring data on the conservation state (conditions), pressures (threats), and responses (conservation interventions) at these sites. IBAs <10 km from World Bank project locations had a marginally lower rate of forest loss than matched IBAs > 100 km from World Bank project locations and were subjected to lower pressures than matched sites, although there were no differences in conservation state or responses underway. Despite important caveats, these results suggest that World Bank development projects do not have a negative impact on biodiversity, and in some cases might be a benefit to biodiversity. Thus, while more work is needed, our results suggest that international development projects might be compatible with nature conservation objectives if delivered with appropriate safeguards.

Academic Citation:

Buchanan, Graeme M., Bradley C. Parks, Paul F. Donald, Brian F. O'Donnell, Daniel Runfola, John P. Swaddle, Lukasz Tracewski, and Stuart H.M. Butchart. 2016. The Impacts of World Bank Development on Sites of High Biodiversity Importance. AidData Working Paper #20. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Are "New" Donors Challenging World Bank Conditionality?

January 2016 | Working Paper 19

Authors:

Diego Hernandez

Abstract:

This paper investigates whether World Bank conditionality is affected by the presence of “new” donors by using panel data for 54 African countries over the 1980 to 2013 period. Empirical results indicate that the World Bank delivers loans with significantly fewer conditions to recipient countries which are assisted by China. Less stringent conditionality is also observed in better off borrowers that are in addition funded by Kuwait and the United Arab Emirates, but this effect vanishes after the start of the new millennium. In contrast, World Bank conditionality is rarely affected by aid inflows from DAC donors, and when it is, conditionality is revised upwards. These findings suggest that new donors might be perceived as an attractive financial option to which the World Bank reacts by offering credits less restrictively in order to remain competitive in the loan-giving market.

Academic Citation:

Hernandez, Diego. 2016. Are "New" Donors Challenging World Bank Conditionality? AidData Working Paper #19. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Sub-national Perspectives on Aid Effectiveness: Impact of Aid on Health Outcomes in Uganda

December 2015 | Working Paper 18

Authors:

Tonny Odokonyero, Alex Ijjo, Robert Marty, Tony Muhumuza, Godfrey Owot Moses

Abstract:

While the health sector has attracted significant foreign aid, evidence on the effectiveness of this support is mixed. By combining household panel data with a unique geographically-referenced foreign aid data, this paper uses a Difference-In-Differences approach to investigate the contribution of aid on key health outcomes in Uganda. We find that even though aid was not targeted to localities with the worst health conditions, health aid achieved an overall significant impact in reducing both disease severity and burden. However, the impact is most robust for disease burden compared to severity. In addition, we observe increased aid effectiveness if resources are channeled to locations that are closer to communities in need, given ease of access to health services. From a policy perspective, the results point to the need for development partners to better target aid to sub-national areas with higher disease prevalence. Moreover, aid ought to be channeled as close to intended beneficiaries as possible, thus offering additional advantage of driving the Universal Health Coverage strategy of “close to client” health system.

Academic Citation:

Odokonyero, Tonny, Alex Ijjo, Robert Marty, Tony Muhumuza, and Godfrey Owot Moses. 2015. Sub-national Perspectives on Aid Effectiveness: Impact of Aid on Health Outcomes in Uganda. AidData Working Paper #18. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Does Foreign Aid Fuel Trust?

December 2015 | Working Paper 17

Authors:

Alexandra D'Onofrio and Giuseppe Maggio

Abstract:

What are the socioeconomic effects of foreign aid in developing countries? How effective is aid in promoting social capital? The paper explores empirically these questions and it assesses the causal effect of foreign aid on trust in Uganda. Individuals living in counties that received aid exhibit higher probability to trust others with respect to those living in counties with no aid. On the intensive margin, increase in one percent in the value of aid projects disbursed induces a similar increase in the probability of trusting other people. We use also an instrumental strategy based on the enforcement of Non Governmental Organizations (Amendment) Act and we show that the link from aid to trust is robust to different estimation strategies. Finally, we find that a channel is operating through lowering inequality. We demonstrate that foreign aid has a stronger effect in counties where there is a lower level of perceived inequality.

Academic Citation:

D'Onofrio, Alexandra and Giuseppe Maggio. 2015. Does Foreign Aid Fuel Trust? AidData Working Paper #17. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Foreign Aid, Foreign Policy, and Domestic Government Legitimacy: Experimental Evidence from Bangladesh

December 2015 | Working Paper 16

Authors:

Simone Dietrich, Minhaj Mahmud, Matthew S. Winters

Abstract:

Foreign aid donors try to make themselves visible as the funders of development projects in order to improve citizen attitudes abroad. Do target populations receive these political communications in the intended fashion, and do they succeed in changing attitudes? Despite the widespread use of the practice, there exists little evidence about the effectiveness of this strategy. We embed an informational experiment about a U.S.-funded health project in a nationwide survey in Bangladesh. Although we find limited recognition of the USAID brand, explicit information about U.S. funding slightly improves general perceptions of the United States. It does not, however, change respondent’s opinions on substantive foreign policy issues. We also find, contrary to existing arguments that foreign aid undermines domestic government legitimacy, that the information increases confidence in local authorities. These results strengthen our understanding of the efficacy of promoting donor visibility and shed light on an important debate in the area of governance that assesses the effect of external actors on government legitimacy.

Academic Citation:

Dietrich, Simone, Minhaj Mahmud, and Matthew S. Winters. 2015. Foreign Aid, Foreign Policy, and Domestic Government Legitimacy: Experimental Evidence from Bangladesh. AidData Working Paper #16. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Apples and Dragon Fruits: The Determinants of Aid and Other Forms of State Financing From China to Africa

October 2015 | Working Paper 15

Authors:

Axel Dreher, Andreas Fuchs, Bradley Parks, Austin M. Strange, Michael J. Tierney

Abstract:

Chinese “aid” is a lightning rod for criticism. Policymakers, journalists, and public intellectuals claim that Beijing is using its largesse to cement alliances with political leaders, secure access to natural resources, and create exclusive commercial opportunities for Chinese firms—all at the expense of citizens living in developing countries. We argue that much of the controversy about Chinese “aid” results from a failure to distinguish between China’s Official Development Assistance (ODA) and more commercially-oriented sources and types of state financing. Using a new database on China’s official financing commitments to Africa from 2000-2013, we find the allocation of Chinese ODA to be driven primarily by foreign policy considerations, while economic interests better explain the distribution of less concessional forms of Chinese official financing. Our results suggest Beijing’s motives may not be substantially different from those shaping the allocation of Western official finance. Our data and findings also address the need for better measures of an increasingly diverse set of non-Western financial activities that are neither well understood nor systematically tracked by the Western-led regime for international development finance.

Academic Citation:

Dreher, Axel, Andreas Fuchs, Bradley Parks, Austin M. Strange, and Michael J. Tierney. 2015. Apples and Dragon Fruits: The Determinants of Aid and Other Forms of State Financing from China to Africa. AidData Working Paper #15. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF) Research Summary (PDF)

Transparency and System Support in Peru

September 2015 | Working Paper 14

Authors:

Darren Hawkins, Lucas Brook, Ian Hansen, Neal Hoopes, Taylor Rawson

Abstract:

Powerful international actors have vigorously promoted transparency for developing countries, yet we know little about the actual effects of transparency. In this paper, we use a series of survey experiments conducted on the streets of Lima, Peru to investigate a fairly simple question: what are the effects of government transparency on attitudes regarding support for the Peruvian political system? Like many developing countries, Peru lacks much system support, making it more difficult to improve governance and democracy. We find that transparency has little impact on political attitudes, unless accompanied by either one of two conditions: the information is attributed to a credible third-party (in our case, USAID), or the information provides a frame in which the government is associate with comparative socioeconomic wellbeing. Under those conditions, Peruvians increase their approval of the national political community, the regime’s performance, regime institutions, and local government. The increases are substantively large, ranging between 6 to 11 points on our 100-point scales, or about half of a standard deviation of the variation in the control groups.

Academic Citation:

Hawkins, Darren, Lucas Brook, Ian Hansen, Neal Hoopes, and Taylor Rawson. 2015. Transparency and System Support in Peru. AidData Working Paper #14. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Does Foreign Aid Target the Poorest?

August 2015 | Working Paper 13

Authors:

Ryan C. Briggs

Abstract:

This paper examines the extent to which foreign aid reaches people at different levels of wealth in Africa. I introduce a method for measuring the sub-national distribution of a country’s population by levels of wealth using household surveys and match this information to data on the location of aid projects from two multilateral donors. Within countries, aid disproportionately flows to regions with more of the richest people. Aid does not favor areas with more of the poorest people. These results suggest that donors are not able to realize their preferences for a pro-poor distribution of aid and that aid is not being allocated effectively to alleviate extreme poverty.

Academic Citation:

Briggs, Ryan C. 2015. Does Foreign Aid Target the Poorest? AidData Working Paper #13. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Update:

An updated version of this paper has been published in International Organization.

'Ground-Truthing' Chinese Development Finance in Africa: Field Evidence from South Africa and Uganda

August 2015 | Working Paper 12

Authors:

Edwin Muchapondwa, Daniel Nielson, Bradley Parks, Austin M. Strange, and Michael J. Tierney

Abstract:

A new methodology, Tracking Underreported Financial Flows (TUFF), leverages open-source information on development finance by non-transparent, non-Western donors. If such open-source methods prove to be valid and reliable, they can enhance our understanding of the causes and consequences of development finance from non-transparent donors including, but not limited to, China. But open-source methods face charges of inaccuracy. In this study we create and field-test a replicable ‘ground-truthing’ methodology to verify, update, and improve open-source data with in-person interviews and site visits in Uganda and South Africa. Ground-truthing generally reveals close agreement between open-source data and answers to protocol questions from informants with official roles in the Chinese-funded projects. Our findings suggest that open-source data collection, while limited in knowable ways, can provide a stronger empirical foundation for research on development finance.

Working Paper Citation:

Muchapondwa, Edwin, Daniel Nielson, Bradley Parks, Austin M. Strange and Michael J. Tierney. 2015. 'Ground-Truthing' Chinese Development Finance in Africa: Field Evidence from South Africa and Uganda. AidData Working Paper #12. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Update:

An updated version of this paper has been published in the Journal of Development Studies.

Journal Article Citation:

Edwin Muchapondwa, Daniel Nielson, Bradley Parks, Austin M. Strange, and Michael J. Tierney. 2016. 'Ground-Truthing' Chinese Development Finance in Africa: Field Evidence from South Africa and Uganda. Journal of Development Studies 52 (6): 780-796.

Doing Harm by Doing Good: The Negative Externalities of Humanitarian Aid Provision During Civil Conflict

July 2015 | Working Paper 11

Authors:

Reed M. Wood and Christopher Sullivan

Abstract:

Humanitarian assistance is intended to ameliorate the human costs of war by providing relief to vulnerable populations. Yet, the introduction of aid resources into conflict zones may influence subsequent violence patterns and expose intended recipients to new risks. Herein, we investigate the potential negative externalities associated with humanitarian aid. We argue that aid can create incentives for armed actors to intentionally target civilians for violence. Aid incentivizes rebel violence by providing opportunities for looting and presenting challenges to rebel authority. It potentially incentivizes state violence where it augments rebel capabilities or provides rebels a resource base. We evaluate both arguments using spatially disaggregated data on aid and conflict violence for a sample of nearly two-dozen post-Cold War African countries. The results of multiple statistical analyses provide strong support for the argument that humanitarian aid is associated with increased rebel violence but less support for the relationship between aid and state violence.

Working Paper Citation:

Wood, Reed M. and Christopher Sullivan. 2015. Doing Harm by Doing Good? The Negative Externalities of Humanitarian Aid Provision during Civil Conflict. AidData Working Paper #11. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Update:

An updated version of this paper has been published in the Journal of Politics.

Journal Article Citation:

Wood, Reed M. and Christopher Sullivan. 2015. Doing Harm by Doing Good? The Negative Externalities of Humanitarian Aid Provision during Civil Conflict. The Journal of Politics 77 (3): 736-748.

Do Aid Donors Specialize and Coordinate within Recipient Countries? The Case of Malawi

June 2015 | Working Paper 10

Authors:

Peter Nunnenkamp, Albena Sotirova, Rainer Thiele

Abstract:

Acknowledging that aid proliferation and a lack of coordination impair aid effectiveness, donors have repeatedly promised to specialize and better coordinate their aid activities, most notably in the Paris Declaration of 2005. We exploit geocoded aid data from Malawi to assess whether the country’s bilateral and multilateral donors have acted accordingly at the district and sector level. We do not find compelling evidence for increased aid specialization after the Paris Declaration, and the regional division of labor among donors may even have deteriorated. Our within-country evidence thus broadly corroborates what previous studies found at the national level of recipient countries.

Academic Citation:

Nunnenkamp, Peter, Albena Sotirova and Rainer Thiele. 2015. Do Aid Donors Specialize and Coordinate within Recipient Countries? The Case of Malawi. AidData Working Paper #10. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Update:

An updated version of this paper has been published in Development Policy Review.

Journal Article Citation:

Nunnenkamp, Peter, Albena Sotirova, and Rainer Thiele. 2016. Do Aid Donors Specialize and Coordinate within Recipient Countries? The Case of Malawi. Development Policy Review 34 (6): 831–849.

Aid and Growth at the Regional Level

May 2015 | Working Paper 9

Authors:

Axel Dreher and Steffen Lohmann

Abstract:

This paper brings the aid effectiveness debate to the sub-national level. We hypothesize the non-robust results regarding the effects of aid on development in the previous literature to arise due to the effects of aid being insufficiently large to measurably affect aggregate outcomes. Using geo-coded data for World Bank aid to a maximum of 2,221 first-level administrative regions (ADM1) and 54,167 second-level administrative regions (ADM2) in 130 countries over the 2000-2011 period, we test whether aid affects development, measured as nighttime light growth. Our preferred identification strategy exploits variation arising from interacting a variable that indicates whether or not a country has passed the threshold for receiving IDA’s concessional aid with a recipient region’s probability to receive aid, in a sample of 478 ADM1 regions and almost 8,400 ADM2 regions from 21 countries. Controlling for the levels of the interacted variables, the interaction provides a powerful and excludable instrument. Overall, we find significant correlations between aid and growth in ADM2 regions, but no causal effects.

Working Paper Citation:

Dreher, Axel and Steffen Lohmann. 2015. Aid and Growth at the Regional Level. AidData Working Paper #9. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF) Research Summary (PDF)

Update:

An updated version of this paper has been published in the Oxford Review of Economic Policy.

Journal Article Citation:

Dreher, Axel and Steffen Lohmann. 2015. Aid and Growth at the Regional Level. Oxford Review of Economic Policy 31: 420-446.

A Spatial Analysis of The Effect of Foreign Aid in Conflict Areas

May 2015 | Working Paper 8

Authors:

Stijn van Weezel

Abstract:

Although most aid projects are aimed at local development, research on aid and conflict mainly uses the country-year as unit of analysis. This study examines the link between aid and conflict at the sub-national level for three African countries between 1999-2008, using a unique dataset with information on local aid projects. The data shows that in general aid is allocated relatively close to the capital whereas conflicts occur in the peripheral areas. In contrast with the literature this study does not find a strong effect of aid on conflict as the analysis provides relatively little empirical support for a link in either positive or negative direction. Some of the results do show that non-fungible aid corresponds with decreases in conflict levels suggesting that aid increases the opportunity costs of rebellion although the magnitude of the effect is very low.

Academic Citation:

van Weezel, Stijn. 2015. A Spatial Analysis of the Effect of Foreign Aid in Conflict Areas. AidData Working Paper #8. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Building a Stronger System for Tracking Nutrition Sensitive Spending: A Methodology and Estimate of Global Spending for Nutrition Sensitive Foreign Aid

May 2015 | Working Paper 7

Authors:

Scott B. Ickes, Rachel B. Trichler, Bradley C. Parks

Abstract:

There is growing awareness that the necessary solutions for improving nutrition outcomes are multi-sectoral. As such, investments are increasingly directed towards “nutrition sensitive” approaches that not only address an underlying or basic determinant of nutrition, but also seek to achieve an explicit nutrition goal or outcome. Understanding how and where official development assistance for nutrition is invested remains an important but complex challenge. Our objective was to develop a methodology for classifying and tracking nutrition sensitive official development assistance and to produce estimates of the amount of nutrition sensitive aid received by countries with a high burden of undernutrition. We analyzed all financial flows reported to the Organization for Economic Co-Operation and Development’s Development Assistance Committee Creditor Reporting Service in 2010 to estimate these investments. We assessed the relationships between national stunting prevalence, stunting burden, under-five mortality and the amount of nutrition specific and nutrition sensitive ODA. We estimate that, in 2010, a total of $379.4 million (M) USD was committed to nutrition specific projects and programs, of which 25 designated beneficiaries accounted for nearly 85% ($320 M). A total of $1.79 billion (B) was committed to nutrition sensitive spending, of which the top 25 countries/regions accounted for $1.4 B (82%). Nine categories of development activities accounted for 75% of nutrition sensitive spending, led by Reproductive Health Care (30.4%), Food Aid/Food Security Programs (14.1%), Emergency Food Aid (13.2%), and Basic Health Care (5.0%). Multivariate linear regression models indicate that the amount of nutrition sensitive (p=0·001) and total nutrition ODA was significantly predicted by stunting prevalence (p = 0.001). The size of the total population of stunted children significantly predicted the amount of nutrition specific ODA (p < 0.001). A reliable estimate of nutrition spending is critical for effective planning by both donors and recipients, and a key for success as the global development community re-commits to a new round of goals to address the inter-related causes of undernutrition in low-income countries.

Academic Citation:

Ickes, Scott B., Rachel B. Trichler, and Bradley C. Parks. Building a Stronger System for Tracking Nutrition Sensitive Spending: A methodology and estimate of global spending for nutrition sensitive foreign aid. AidData Working Paper #7. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Update:

An updated version of this paper has been published in the Food and Nutrition Bulletin.

Journal Article Citation:

Ickes, Scott B., Rachel B. Trichler, and Bradley C. Parks. 2015. Building a Stronger System for Tracking Nutrition Sensitive Spending: A Methodology and Estimate of Global Spending for Nutrition-Sensitive Foreign Aid. Food and Nutrition Bulletin 36 (4): 520-33.

The Foreign Aid Effectiveness Debate: Evidence from Malawi

March 2015 | Working Paper 6

Authors:

Rajlakshmi De and Charles Becker

Abstract:

Understanding the role of foreign aid in poverty alleviation is one of the central inquiries of development economics. To augment past cross-country studies, this paper offers a first step toward addressing the absence of disaggregated estimates of the allocation and impact of foreign aid. Newly geocoded aid project data from Malawi are used in combination with multiple rounds of living standards data to assess the allocation and impact of health aid, water aid, and education aid. Allocation is modeled using living standards variables, geographic indicators, and other aid bundling. Significant, positive effects of health aid on decreasing disease severity and of water aid on decreasing diarrhea incidence were estimated through both IV and PSM difference-in-differences approaches. An appropriate instrument for education aid could not be determined, but propensity score matching methods indicate a potential positive effect of education aid on school enrollment. Different aid donors’ allocation behaviors are also assessed. The aid impact results suggest that a sub-national framework provides sufficient granularity for detecting the impacts of foreign aid on poverty alleviation in Malawi and that policymakers and governments should use geographic living standards information to inform future aid allocation.

Academic Citation:

De, Rajlakshmi and Charles Becker. 2015. The Foreign Aid Effectiveness Debate: Evidence from Malawi. AidData Working Paper #6. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

The Political Economy of Aid Allocation in Africa: Evidence from Zambia

January 2015 | Working Paper 5

Authors:

Takaaki Masaki

Abstract

Does electoral politics influence the allocation of foreign aid within aid-recipient countries? Despite the abundance of studies on the determinants of aid allocation, the existing literature offers little leverage on this question, largely due to the paucity of data on the locations of donor-funded projects. In this essay, I utilize newly available data on the georaphical distribution of development projects in Zambia to test whether electorial incentivies shape aid allocation at the sub-national level. Challenging a widespread belief in African politics that autocrats reward their own core supporters with more resources, I argue -- and find strong evidence -- that when they have limited knowledge about citizens' voting preferences, political elites distribute more donor projects to districts where opposition to the ruling party (or incumbent president) enjoys greater popularity; and districts where a majority of voters share the ethnicity of the incumbent president.

Academic Citation:

Masaki, Takaaki. 2015. The Political Economy of Aid Allocation in Africa: Evidence from Zambia. AidData Working Paper #5. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF) Research Summary (PDF)

Update:

An updated version of this paper will be published in African Studies Review.

Aiming at the Wrong Targets: The Difficulty of Improving Domestic Institutions with International Aid

May 2015 (Updated) | Working Paper 4

Authors:

Benjamin P. Buch, Mark T. Buntaine, Bradley C. Parks

Abstract:

We explain why the record of aid agencies in building and reforming public sector institutions in developing countries has been broadly unsuccessful, despite extraordinary amounts of time, money, effort, and a commitment to achieve targets. We argue that requirements to specify and monitor observable indicators of success have created strong incentives for aid-dependent countries to signal performance to their foreign sponsors by achieving targets. However, in the absence of requirements about the types of targets that should be pursued, countries that rely heavily upon external sources of financial support select easy targets that have limited value for strengthening public sector institutions. In particular, aid-dependent countries are more likely to select targets that measure how public sector institutions are organized, rather than targets that measure what policy outcomes are achieved through strengthened public sector institutions. We demonstrate that this argument has both explanatory and predictive power for World Bank environment and natural resource management projects.

Original Citation:

Buch, Benjamin P., Mark T. Buntaine, and Bradley C. Parks. 2015. Aiming at the Wrong Targets: The Difficulty of Improving Domestic Institutions with International Aid. AidData Working Paper #4. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Update:

An updated version of this paper will be published in International Studies Quarterly.

Updated Citation:

Buntaine, Mark T., Bradley C. Parks, and Benjamin P. Buch. Forthcoming. Aiming at the Wrong Targets: The Domestic Consequences of International Efforts to Build Institutions. International Studies Quarterly.

Aid on Demand: African Leaders and the Geography of China's Foreign Assistance

November 2014 | Working Paper 3

Updated:

October, 2016

Authors:

Axel Dreher, Andreas Fuchs, Roland Hodler, Bradley C. Parks, Paul A. Raschky, and Michael J. Tierney

Abstract:

This article investigates whether China’s foreign aid is particularly prone to capture by political leaders of aid-receiving countries. We examine whether more Chinese aid is allocated to the birth regions of political leaders and regions populated by the ethnic groups to which leaders belong, controlling for indicators of need and various fixed effects. We have collected data on 117 African leaders’ birthplaces and ethnic groups and have geocoded 1,650 Chinese development finance projects across 3,097 physical locations that were committed to Africa over the 2000–2012 period. Our econometric results show that when leaders hold power their birth regions receive substantially more funding from China than other subnational regions. We also find—less robust—evidence that African leaders direct more Chinese aid to areas populated by individuals who share their ethnicity. However, when we replicate the analysis for the World Bank, our regressions show no evidence of favoritism. We also evaluate the impact of Chinese aid on regional development, exploiting time variation in the amount of Chinese aid that results from China’s production of steel and geographical variation in the probability that a subnational region will receive such aid. We find that Chinese aid improves local development outcomes, as measured by per-capita nighttime light emissions at the first and second subnational administrative level. We therefore conclude that China’s foreign aid program has both distributional and developmental consequences for Africa.

Updated Working Paper (PDF) Original Working Paper (PDF)

Updated Citation:

Dreher, Axel, Andreas Fuchs, Roland Hodler, Bradley C. Parks, Paul A. Raschky and Michael J. Tierney. 2016. Aid on Demand: African Leaders and the Geography of China's Foreign Assistance. AidData Working Paper #3 Revised. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Original Citation:

Dreher, Axel, Andreas Fuchs, Roland Hodler, Bradley C. Parks, Paul A. Raschky and Michael J. Tierney. 2014. Aid on Demand: African Leaders and the Geography of China's Foreign Assistance. AidData Working Paper #3. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Titling Community Land to Prevent Deforestation: No Reduction in Forest Loss in Morona-Santiago, Ecuador

October 2014 | Working Paper 2

Authors:

Mark T. Buntaine, Stuart E. Hamilton, Marco Millones

Abstract:

Land tenure and land titling programs for forests have become a mainstay of conservation and resource management policy worldwide. They are thought to reduce deforestation by lengthening the time horizon of landholders and improving the ability of landholders to legally exclude competing users. Despite these expectations, reliable evidence about how land titling programs affect forest cover is limited because programs are targeted according to other factors that themselves influence the conversion of forests, such as indigenous status or low population density. We investigate the effect of a donor-funded land titling and management program on forest cover in Morona-Santiago, Ecuador. To estimate the impact of community land titles and management plans, we match plots in program areas with similar plots outside program areas on a variety of covariates that influence forest conversion. Based on matched comparisons, we do not find evidence that land titling or the creation of community management plans reduced forest loss in the first five years after the program. Our results are some of the first evidence about the effects of land titling programs on forests that account for spatial assignment and interactions with other institutions. More broadly, our analysis demonstrates the promise of using remotely sensed data to evaluate the effects of policies beyond normal cycles of policy and program evaluation.

Working Paper Citation:

Buntaine, Mark T., Stuart E. Hamilton, and Marco Millones. 2014. Titling Community Land to Prevent Deforestation: No Reduction in Forest Loss in Morona-Santiago, Ecuador. AidData Working Paper #2. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)

Update:

An updated version of this paper has been published in Global Environmental Change.

Journal Article Citation:

Buntaine, Mark T., Stuart E. Hamilton and Marco Millones. 2015. Titling Community Land to Prevent Deforestation: An Evaluation of a Best-Case Program in Morona-Santiago, Ecuador. Global Environmental Change 33: 32-43.

Leveraging Aid for Trade Capacity in Uganda

October 2014 | Working Paper 1

Authors:

Alex Thomas Ijjo, Isaac Shinyekwa

Abstract:

The hindrances to the gainful participation of least developed countries (LDCs) in international trade are predominantly domestic supply related constraints rather than foreign market access. These constraints include variable productive capacity, economic infrastructure bottlenecks, and inability to meet international quality standards. In recognition of such challenges facing LDCs, the World Trade Organization (WTO) launched the “Aid for Trade” (AFT) initiative in 2005 to coordinate international support for strengthening trade capacity in LDCs. Looking at the case of Uganda, we initially examine the role of overall Official Development Assistance (ODA) in driving Uganda’s external trade and then specifically that of AFT in strengthening national trade capacity. Although we find reasonable alignment between aid and national development priorities, there is, as yet, very little evidence of a robust aid impact especially on export capability vis-à-vis that of import. The paper underscores persisting deficiency in Uganda’s capacity to meet internationally accepted standards and to ensure stability and consistency in export supplies. While we note the development of some capacity in trade policy formulation and the mainstreaming of more relevant trade strategies into the country’s National Development Plan (NDP) with aid support, we recommend that future aid support be directed into unlocking the crippling constraints in Uganda’s productive capacity, standards development, economic infrastructure and sound trade policy analysis and formulation.

Academic Citation:

Ijjo, Alex Thomas and Isaac Shinyekwa. 2014. Leveraging Aid for Trade Capacity in Uganda. AidData Working Paper #1. Williamsburg, VA: AidData. Accessed at http://aiddata.org/working-papers.

Working Paper (PDF)