More than Words and Good Intentions: The Political Agenda-Setting Power Behind Foreign Aid Mechanisms
AbstractIn this paper, international aid is examined as a tool for political agenda-setting. A theoretical model is constructed for the analysis, incorporating the incentives created by foreign aid, on the political benefits of recipient governments. The model also incorporates the compensating benefits provided by these governments through the legitimization of the donor country's political agenda. The main results of this model indicate that governments which offer international assistance can influence the political agenda of recipient countries through two channels: 1) By reducing the political costs of official intervention in issues that receive aid, and 2) By generating incentives for additional political rent-seeking. The results are studied in the case of aid provided by the USA to Colombia during the period 1998-2012, which shows the power of US presidents to establish part of the Colombian political agenda related to drugs and terrorism. The results are obtained through a novel content analysis of presidential speeches in both countries and from a set of estimates corrected by possible problems of endogeneity in foreign aid allocation.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 54826.
Date of creation: 26 Mar 2014
Date of revision:
Agenda-Setting; Foreign Aid; Content Analysis; International-Politics;
Find related papers by JEL classification:
- F02 - International Economics - - General - - - International Economic Order; Noneconomic International Organizations;; Economic Integration and Globalization: General
- F35 - International Economics - - International Finance - - - Foreign Aid
- F54 - International Economics - - International Relations, National Security, and International Political Economy - - - Colonialism; Imperialism; Postcolonialism
- F59 - International Economics - - International Relations, National Security, and International Political Economy - - - Other
This paper has been announced in the following NEP Reports:
- NEP-ALL-2014-04-05 (All new papers)
- NEP-LAM-2014-04-05 (Central & South America)
- NEP-POL-2014-04-05 (Positive Political Economics)
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