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Aid allocation by German NGOs: Does the degree of public refinancing matter?

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  • Dreher, Axel
  • Nunnenkamp, Peter
  • Thiel, Susann
  • Thiele, Rainer

Abstract

Using a new dataset for 41 German non-governmental organizations (NGOs), we analyze the allocation of NGO aid across recipient countries in a Tobit regression framework. By identifying for each NGO the degree of public refinancing, we address the largely unresolved issue of whether financial dependence on the government impairs the targeting of NGO aid. It turns out that German NGOs are more active in poorer countries, while they do not complement official aid by working under difficult local conditions. Beyond a certain threshold, rising financial dependence weakens their poverty orientation and provides an incentive to engage in easier” environments. In addition, we find that the NGOs follow the state as well as NGO peers when allocating aid. This herding behavior is, however, hardly affected by the degree of public refinancing. --

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Bibliographic Info

Paper provided by University of Goettingen, Department of Economics in its series Center for European, Governance and Economic Development Research Discussion Papers with number 92.

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Date of creation: 2010
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Handle: RePEc:zbw:cegedp:92

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Keywords: NGO aid; aid allocation; public refinancing;

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References

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Citations

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Cited by:
  1. Öhler, Hannes & Nunnenkamp, Peter, 2011. "Funding, Competition and the Efficiency of NGOs: An Empirical Analysis of Non-charitable Expenditure of US NGOs Engaged in Foreign Aid," Proceedings of the German Development Economics Conference, Berlin 2011 62, Verein für Socialpolitik, Research Committee Development Economics.
  2. Öhler, Hannes, 2013. "Do Aid Donors Coordinate Within Recipient Countries?," Working Papers, University of Heidelberg, Department of Economics 0539, University of Heidelberg, Department of Economics.
  3. Nunnenkamp, Peter & Öhler, Hannes, 2011. "Aid Allocation through Various Official and Private Channels: Need, Merit, and Self-Interest as Motives of German Donors," World Development, Elsevier, Elsevier, vol. 39(3), pages 308-323, March.

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