Of Donor Coordination, Free-Riding, Darlings, and Orphans: The dependence of bilateral aid on other bilateral giving
AbstractUsing data from 1988 to 2007, we examine to what extent bilateral aid flows of an individual donor to a country depend on aid flows from all other bilateral and multilateral donors to that country. We thereby want to assess to what extent donor coordination, free-riding, selectivity, specialization, and common donor motivations drive bilateral aid allocation as these determinants would point to different dependence structures. Using approaches from spatial econometrics and controlling for endogeneity, we find that other bilateral flows lead to a significant increase in aid flows from a particular donor. The effects are particularly pronounced for recipients in Africa and the Middle East and socalled donor ‘orphans’ who seem to be collectively shunned by bilateral aid donors. The positive dependence also seems be related to donors following the lead of the largest donors. Over time, the positive dependence has become smaller. Overall the results suggest that donor coordination and free-riding are quantitatively less important than common donor interests and selectivity.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Courant Research Centre PEG in its series Courant Research Centre: Poverty, Equity and Growth - Discussion Papers with number 137.
Date of creation: 18 Mar 2013
Date of revision:
Contact details of provider:
Postal: Platz der Goettinger Sieben 3; D-37073 Goettingen, GERMANY
Phone: +49 551 39 14066
Fax: + 49 551 39 14059
Web page: http://www.uni-goettingen.de/en/82144.html
aid; donor coordination; aid darlings; aid orphans;
Other versions of this item:
- Ronald B. Davies & Stephan Klasen, 2013. "Of Donor Coordination, Free-Riding, Darlings, and Orphans: The Dependence of Bilateral Aid on Other Bilateral Giving," CESifo Working Paper Series 4177, CESifo Group Munich.
- F35 - International Economics - - International Finance - - - Foreign Aid
- F42 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Policy Coordination and Transmission
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-04-13 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Finn Tarp & Christian F. Bach & Henrik Hansen & Søren Baunsgaard, 1998. "Danish Aid Policy: Theory and Empirical Evidence," Discussion Papers 98-06, University of Copenhagen. Department of Economics.
- Stefaan Marysse & An Ansoms & Danny Cassimon, 2007.
"The Aid 'Darlings' and 'Orphans' of the Great Lakes Region in Africa,"
European Journal of Development Research,
Taylor and Francis Journals, vol. 19(3), pages 433-458.
- Cassimon, Danny & Ansoms, An & Marysse, Stefaan, 2006. "The Aid 'Darlings' and 'Orphans' of the Great Lakes Region in Africa," IOB Discussion Papers 2006.10, Universiteit Antwerpen, Institute of Development Policy and Management (IOB).
- David Dollar & Craig Burnside, 2000.
"Aid, Policies, and Growth,"
American Economic Review,
American Economic Association, vol. 90(4), pages 847-868, September.
- A. Javier Hamann & Ales Bulir, 2006.
"Volatility of Development Aid: From the Frying Pan Into the Fire?,"
IMF Working Papers
06/65, International Monetary Fund.
- Bulír, Ales & Hamann, A. Javier, 2008. "Volatility of Development Aid: From the Frying Pan into the Fire?," World Development, Elsevier, vol. 36(10), pages 2048-2066, October.
- Knack, Stephen & Rogers, F. Halsey & Eubank, Nicholas, 2011.
"Aid Quality and Donor Rankings,"
Elsevier, vol. 39(11), pages 1907-1917.
- Collier, Paul & Dollar, David, 1999.
"Aid allocation and poverty reduction,"
Policy Research Working Paper Series
2041, The World Bank.
- Emmanuel Frot & Javier Santiso, 2009.
"Herding in Aid Allocation,"
OECD Development Centre Working Papers
279, OECD Publishing.
- I�aki Aldasoro & Peter Nunnenkamp & Rainer Thiele, 2010.
"Less aid proliferation and more donor coordination? The wide gap between words and deeds,"
Journal of International Development,
John Wiley & Sons, Ltd., vol. 22(7), pages 920-940.
- Iñaki Aldasoro & Peter Nunnenkamp & Rainer Thiele, 2009. "Less Aid Proliferation and More Donor Coordination? The Wide Gap between Words and Deeds," Kiel Working Papers 1516, Kiel Institute for the World Economy.
- Timothy D. Lane & Leslie Lipschitz & Cristina Arellano & Ales Bulir, 2005.
"The Dynamic Implications of Foreign Aid and Its Variability,"
IMF Working Papers
05/119, International Monetary Fund.
- Arellano, Cristina & Bulír, Ales & Lane, Timothy & Lipschitz, Leslie, 2009. "The dynamic implications of foreign aid and its variability," Journal of Development Economics, Elsevier, vol. 88(1), pages 87-102, January.
- Choi, In, 2001. "Unit root tests for panel data," Journal of International Money and Finance, Elsevier, vol. 20(2), pages 249-272, April.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dominik Noe).
If references are entirely missing, you can add them using this form.