Aid allocation, poverty reduction and the Assessing Aid report
Assessing Aid argues that aid should be reallocated in favour of poor countries with good policies. This argument is based on a model in which poverty depends on growth, and growth on aid, the impact of aid being higher in countries with good policies. So-called 'poverty-efficient' aid allocations are thus calculated, which are shown to be at odds with those of bilateral donors. There are a number of theoretical and empirical shortcomings in this work. First, aid can affect poverty through channels other than growth. Second, what constitutes 'good policies' is debatable. Third, the empirical estimates are very sensitive to changes in model specification and sample. This paper critically reviews these three issues and finds the poverty-oriented aid reallocations implied in Assessing Aid to be an unreliable guide to policy. Copyright © 2000 John Wiley & Sons, Ltd.
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Volume (Year): 12 (2000)
Issue (Month): 3 ()
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References listed on IDEAS
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- Henrik Hansen & Finn Tarp, 2000. "Aid effectiveness disputed," Journal of International Development, John Wiley & Sons, Ltd., vol. 12(3), pages 375-398.
- Alejandro Ramirez & Gustav Ranis, 1997. "Economic Growth and Human Development," Working Papers 787, Economic Growth Center, Yale University.
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- Ranis, Gustav & Stewart, Frances & Ramirez, Alejandro, 2000.
"Economic Growth and Human Development,"
Elsevier, vol. 28(2), pages 197-219, February.
- Alejandro Ramirez & Gustav Ranis & Frances Stewart, "undated". "Economic Growth and Human Development -," QEH Working Papers qehwps18, Queen Elizabeth House, University of Oxford.
- Ranis, G. & Ramirez, A. & Stewart, F., 1997. "Economic Growth and Human Development," Papers 787, Yale - Economic Growth Center.
- Filmer, Deon & Pritchett, Lant, 1997. "Child mortality and public spending on health : how much does money matter?," Policy Research Working Paper Series 1864, The World Bank.
- Howard White, 1999. "Global poverty reduction: are we heading in the right direction?," Journal of International Development, John Wiley & Sons, Ltd., vol. 11(4), pages 503-519.
- Lucia Hanmer & Robert Lensink & Howard White, 2003. "Infant and child mortality in developing countries: Analysing the data for Robust determinants," Journal of Development Studies, Taylor & Francis Journals, vol. 40(1), pages 101-118. Full references (including those not matched with items on IDEAS)