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Inertia and Herding in Humanitarian Aid Decisions

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  • David Fielding

    () (Department of Economics, University of Otago)

Abstract

Using panel data for the period 1995-2008, we model the aid allocation decisions of the three largest official donors of humanitarian aid: the United States government, the United Kingdom government and the European Commission. We find evidence that donor decisions depend on both the recipientÕs need and the donorÕs economic interest, but with marked asymmetries in the relative importance of different factors across the three donors. Moreover, some donors exhibit much more inertia than others in responding to new areas of need, and some are much more influenced by the decisions of other donors. Despite being a relatively small donor, the United Kingdom is particularly influential.

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File URL: http://www.business.otago.ac.nz/econ/research/discussionpapers/DP_1009.pdf
File Function: First version, 2010
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Bibliographic Info

Paper provided by University of Otago, Department of Economics in its series Working Papers with number 1009.

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Length: 32 pages
Date of creation: Aug 2010
Date of revision: Aug 2010
Handle: RePEc:otg:wpaper:1009

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Related research

Keywords: Humanitarian aid; Dynamic panel model;

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  1. Alberto Alesina & David Dollar, 1998. "Who Gives Foreign Aid to Whom and Why?," NBER Working Papers 6612, National Bureau of Economic Research, Inc.
  2. Berthelemy, Jean-Claude & Tichit, Ariane, 2002. "Bilateral Donors' Aid Allocation Decisions: A Three-dimensional Panel Analysis," Working Papers UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  3. Canavire-Bacarreza, Gustavo & Nunnenkamp, Peter & Thiele, Rainer & Triveño, Luis, 2006. "Assessing the allocation of aid : developmental concerns and the self-interest of donors," Open Access publications from Kiel Institute for the World Economy info:hdl:10419/3983, Kiel Institute for the World Economy.
  4. Guilkey, David K. & Murphy, James L., 1993. "Estimation and testing in the random effects probit model," Journal of Econometrics, Elsevier, vol. 59(3), pages 301-317, October.
  5. Anastasia Semykina & Jeffrey M. Woodridge, 2010. "Estimating Panel Data Models in the Presence of Endogeneity and Selection," Working Papers wp2010_10_01, Department of Economics, Florida State University.
  6. Fleck, Robert K. & Kilby, Christopher, 2010. "Changing aid regimes? U.S. foreign aid from the Cold War to the War on Terror," Journal of Development Economics, Elsevier, vol. 91(2), pages 185-197, March.
  7. Simon Feeny & Matthew Clarke, 2007. "What Determines Australia's Response to Emergencies and Natural Disasters?," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 40(1), pages 24-36, 03.
  8. Neumayer, Eric, 2005. "Is the allocation of food aid free from donor interest bias?," Open Access publications from London School of Economics and Political Science http://eprints.lse.ac.uk/, London School of Economics and Political Science.
  9. McGillivray, Mark & Oczkowski, Edward, 1991. "Modelling the Allocation of Australian Bilateral Aid: A Two-Part Sample Selection Approach," The Economic Record, The Economic Society of Australia, vol. 67(197), pages 147-52, June.
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