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Looking ahead optimally in allocating aid

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  • Adrian Wood (QEH)

Abstract

The Collier-Dollar approach to aid allocation has been less than fully embraced by donors – even those focused on poverty reduction – and has come into conflict with a different approach based on the Millennium Development Goals. These two approaches are shown to be special cases of a more general model of optimal aid allocation, in which donors care about future as well as current poverty. The model is illustratively applied to data for developing regions. Adding a poverty decline adjustment to the allocation formulae now used by aid agencies would make these formulae more efficient and more acceptable.

Suggested Citation

  • Adrian Wood (QEH), "undated". "Looking ahead optimally in allocating aid," QEH Working Papers qehwps137, Queen Elizabeth House, University of Oxford.
  • Handle: RePEc:qeh:qehwps:qehwps137
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    Cited by:

    1. Sumner, Andy, 2012. "Where Do The Poor Live?," World Development, Elsevier, vol. 40(5), pages 865-877.
    2. Ronald B. Davies & Stephan Klasen, 2013. "Of Donor Coordination, Free-Riding, Darlings, and Orphans: The Dependence of Bilateral Aid on Other Bilateral Giving," CESifo Working Paper Series 4177, CESifo Group Munich.
    3. Carter, Patrick, 2014. "Aid allocation rules," European Economic Review, Elsevier, vol. 71(C), pages 132-151.
    4. Sergio Tezanos Vázquez, 2009. "Geopolítica de la ayuda ¿Cómo optimizar el impacto de la ayuda sobre el crecimiento?," Documentos de trabajo sobre cooperación y desarrollo 200903, Cátedra de Cooperación Internacional y con Iberoamérica (COIBA), Universidad de Cantabria.
    5. Bourguignon, François & Platteau, Jean-Philippe, 2017. "Does Aid Availability Affect Effectiveness in Reducing Poverty? A Review Article," World Development, Elsevier, vol. 90(C), pages 6-16.
    6. Bodenstein, Thilo & Kemmerling, Achim, 2015. "A Paradox of Redistribution in International Aid? The Determinants of Poverty-Oriented Development Assistance," World Development, Elsevier, vol. 76(C), pages 359-369.
    7. Danny Cassimon & Stijn Claessens & Bjorn Van Campenhout, 2007. "Empirical Evidence on the New International Aid Architecture," IMF Working Papers 07/277, International Monetary Fund.
    8. Patrick GUILLAUMONT & Phu NGUYEN-VAN & Thi Kim Cuong PHAM & Laurent WAGNER, 2015. "Efficient and fair allocation of aid," Working Papers 3937, FERDI.
    9. TEZANOS, Sergio, 2009. "Geopolítica De La Ayuda. ¿Cómo Optimizar El Impacto De La Ayuda Sobre El Crecimiento?," Estudios Economicos de Desarrollo Internacional, Euro-American Association of Economic Development, vol. 9(2), pages 55-88.
    10. Temple, Jonathan R.W., 2010. "Aid and Conditionality," Handbook of Development Economics, Elsevier.
    11. Gachet, Adrian Nicholas, 2016. "What is the relation between foreign aid and trade?," MPRA Paper 70861, University Library of Munich, Germany.
    12. Hyun-Hoon Lee & Donghyun Park & Meehwa Shin, 2015. "Do Developing-country WTO Members Receive More Aid for Trade (AfT)?," The World Economy, Wiley Blackwell, vol. 38(9), pages 1462-1485, September.
    13. Alan Gelb, 2010. "How Can Donors Create Incentives for Results and Flexibility for Fragile States? A Proposal for IDA," Working Papers id:3233, eSocialSciences.
    14. Feeny, Simon & de Silva, Ashton, 2012. "Measuring absorptive capacity constraints to foreign aid," Economic Modelling, Elsevier, vol. 29(3), pages 725-733.
    15. Ha Hoang, 2014. "Aid darling and the European Union’s aid allocation policy: the case of Vietnam," Asia Europe Journal, Springer, vol. 12(3), pages 301-324, September.
    16. Lars M. Johansson & Jan Pettersson, 2008. "Tied Aid, Trade-Facilitating Aid or Trade-Diverting Aid?," DEGIT Conference Papers c013_008, DEGIT, Dynamics, Economic Growth, and International Trade.

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