On Foreign Aid Distortions to Governance

Foreign Aid, Incentives and Efficiency: Can Foreign Aid Lead to Efficient Level of Investment?

This paper develops a two-period-two-country model in which an altruistic donor faces Samaritan’s Dilemma to address two important policy questions: (i) whether foreign aid can lead to efficient level of capital investment in the recipient country and (ii) how do the form (e.g. budgetary transfers, capital transfer) and the timing of aid affect the incentives of the recipient? It finds that the...

Does Aid Affect Governance?

Food aid and governance

Arguing that food security management belongs to the core of government tasks and has been since Biblical times, we assess current practices in this domain and their effect on local governance, with special reference to the food aid operations of the World Food Program. Within the food security management task, we distinguish three basic elements: (i) entitlement: to provide income entitlements...

Americans on Foreign Aid and World Hunger

In 1995 PIPA found that, while an overwhelming majority supported aid in principle, a majority wanted to cut it. However when asked to estimate how much of the budget was devoted to foreign aid, respondents vastly overestimated its size, and when asked what would be appropriate they proposed an amount far higher than the actual amount. In this new study PIPA sought to find out how perceptions a...

Introduction to the Geopolitics of Foreign Aid

Introduction: Geopolitics and aid Foreign aid is an essential element of foreign policy for many countries. Since World War I, the richest states in the world have used transfers of goods, services, and funds as a means of interacting with other countries. Over time, increasing numbers of states have given increasing amounts of resources to other states. Aid has come in the form both of loans, ...