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Foreign Aid and Undeserved Credit Claiming

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  • Cesi Cruz
  • Christina J. Schneider

Abstract

Politicians in developing countries misuse foreign aid to get reelected by fiscally manipulating foreign aid resources or domestic budgets. Our article suggests another mechanism that does not require politicians to have any control over foreign aid in order to make use of it for electoral purposes: undeserved credit claiming. We analyze the conditions under which local politicians can undeservedly take credit for the receipt of foreign aid and thereby boost their chances of reelection. We theorize that politicians can employ a variety of techniques to claim credit for development aid even when they have little or no influence on its actual allocation. Using a subnational World Bank development program in the Philippines, we demonstrate that credit claiming is an important strategy to exploit foreign aid inflows and that the political effects of aid can persist even when projects are designed to minimize the diversion or misuse of funds.

Suggested Citation

  • Cesi Cruz & Christina J. Schneider, 2017. "Foreign Aid and Undeserved Credit Claiming," American Journal of Political Science, John Wiley & Sons, vol. 61(2), pages 396-408, April.
    • Handle: RePEc:wly:amposc:v:61:y:2017:i:2:p:396-408
    DOI: 10.1111/ajps.12285
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    References listed on IDEAS

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    1. World Bank, 2005. "CDD (Community Driven Development) and Social Capital Impact : Designing a Baseline Survey in the Philippines," World Bank Publications - Reports 8652, The World Bank Group.
    2. Labonne, Julien & Chase, Robert S., 2009. "Who is at the Wheel When Communities Drive Development? Evidence from the Philippines," World Development, Elsevier, vol. 37(1), pages 219-231, January.
    3. Mary Kay Gugerty & Michael Kremer, 2008. "Outside Funding and the Dynamics of Participation in Community Associations," American Journal of Political Science, John Wiley & Sons, vol. 52(3), pages 585-602, July.
    4. Paul Clist & Alessia Isopi & Oliver Morrissey, 2012. "Selectivity on aid modality: Determinants of budget support from multilateral donors," The Review of International Organizations, Springer, vol. 7(3), pages 267-284, September.
    5. Labonne, Julien, 2016. "Local political business cycles: Evidence from Philippine municipalities," Journal of Development Economics, Elsevier, vol. 121(C), pages 56-62.
    6. Labonne, Julien, 2013. "The local electoral impacts of conditional cash transfers," Journal of Development Economics, Elsevier, vol. 104(C), pages 73-88.
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