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Does Aid Availability Affect Effectiveness in Reducing Poverty? A Review Article
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DOI：10.1016/j.worlddev.2015.06.003.png)
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Abstract
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This paper addresses the impact of aid supply on aid effectiveness. First, we review theoretical literature that deals with the problem of governance in donor-recipient relationships and are susceptible of highlighting effects of aggregate aid availability. Second, we provide a conceptual framework that explicitly incorporates a trade-off between considerations of needs and governance. We examine the impact of aid supply on the manner in which a donor agency allocates the available money between countries differing in terms of both needs and domestic governance. The central conclusion is that a donor's utility function that embodies the need-governance trade-off and the associated optimization mechanism yield a meaningful rule to guide inter-country allocation of aid resources. (C) 2015 The Authors. Published by Elsevier Ltd.
Keywords:
aid effectiveness
governance
poverty reduction
aid allocation
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