Decentralizing Aid with Interested Parties
This paper analyzes the decentralization of decision-making in aid-giving in a theoretical rent-seeking framework. In this analysis the root donor establishes a necessary criterion for potential recipients: good governance. The potential recipients compete in hierarchal contests for funds. The paper investigates whether, under certain reasonable conditions, fashionable aid procedures will lead to the development of a poverty trap.
|Date of creation:||01 Dec 2006|
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- McGillivray, Mark & Feeny, Simon & Hermes, Niels & Lensink, Robert, 2005. "It Works; It Doesn't; It Can, But That Depends?: 50 Years of Controversy over the Macroeconomic Impact of Development Aid," Working Paper Series RP2005/54, World Institute for Development Economic Research (UNU-WIDER).
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