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Organization of Disaster Aid Delivery: Spending Your Donations

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  • J. Vernon Henderson
  • Yong Suk Lee

Abstract

This paper analyzes how different organizational structures between funding and implementing agencies affect the quality of aid delivered and social agendas pursued across neighboring villages in a set disaster context. We model the implied objective functions and trade-offs concerning aid quality, aid quantity, and social agendas of different types of agencies. We analyze three waves of survey data on fishermen and fishing villages in Aceh, Indonesia from 2005-2009, following the tsunami. Different organizational structures result in significantly different qualities of hard aid, differential willingness to share aid delivery with other NGOs in a village, and differential promotion of public good objectives and maintenance of village religious and occupational traditions. This is the first time these aspects have been modeled and quantified in the literature. Some well known international NGOs delivered housing with relatively low rates of reported faults such as leaky roofs and cracked walls; others had relatively high rates. For boats, some had very high rates of boat “failure”, boats that sank upon launch, were not seaworthy, or fell apart within a month or two. We also document how a social agenda of particular agencies to promote greater equality can be thwarted and distorted by village leaders, potentially increasing inequality.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 17707.

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Date of creation: Dec 2011
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Handle: RePEc:nbr:nberwo:17707

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  1. Dollar, David & Alesina, Alberto, 2000. "Who Gives Foreign Aid to Whom and Why?," Scholarly Articles, Harvard University Department of Economics 4553020, Harvard University Department of Economics.
  2. Anup Malani & Tomas Philipson & Guy David, 2003. "Theories of Firm Behavior in the Nonprofit Sector. A Synthesis and Empirical Evaluation," NBER Chapters, National Bureau of Economic Research, Inc, in: The Governance of Not-for-Profit Organizations, pages 181-216 National Bureau of Economic Research, Inc.
  3. Martens,Bertin & Mummert,Uwe & Murrell,Peter & Seabright,Paul, 2002. "The Institutional Economics of Foreign Aid," Cambridge Books, Cambridge University Press, Cambridge University Press, number 9780521808187.
  4. Wane, Waly, 2004. "The quality of foreign aid : country selectivity or donors incentives?," Policy Research Working Paper Series, The World Bank 3325, The World Bank.
  5. Martin Gaynor & James B. Rebitzer & Lowell J. Taylor, 2004. "Physician Incentives in Health Maintenance Organizations," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 112(4), pages 915-931, August.
  6. Torsvik, Gaute, 2005. "Foreign economic aid; should donors cooperate?," Journal of Development Economics, Elsevier, Elsevier, vol. 77(2), pages 503-515, August.
  7. Azam, Jean-Paul & Laffont, Jean-Jacques, 2003. "Contracting for aid," Journal of Development Economics, Elsevier, Elsevier, vol. 70(1), pages 25-58, February.
  8. Svensson, Jakob, 2003. "Why conditional aid does not work and what can be done about it?," Journal of Development Economics, Elsevier, Elsevier, vol. 70(2), pages 381-402, April.
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Cited by:
  1. Emily Skarbek, 2014. "The Chicago Fire of 1871: a bottom-up approach to disaster relief," Public Choice, Springer, Springer, vol. 160(1), pages 155-180, July.
  2. Prema-chandra Athukorala, 2012. "Disaster, Generosity and Recovery: Indian Ocean Tsunami," Departmental Working Papers, The Australian National University, Arndt-Corden Department of Economics 2012-04, The Australian National University, Arndt-Corden Department of Economics.

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