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Donor Influence in MDBs: the Case of the Asian Development Bank

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Abstract

This paper explores the influence of Japan and the United States over the geographic distribution of Asian Development Bank (ADB) funds. Although nominally an independent, multilateral organization, the ADB is widely regarded as bowing to the interests of its two most influential donors. Estimation using panel data for less developed Asian countries from 1968 to 2002 reveals significant donor influence with inconsistent weight placed on humanitarian criteria given limited funding for the region’s largest countries, China and India. Comparing the results with research on World Bank loan allocation suggests donor interests are more important in the ADB. This finding justifies the existence of regional development banks on political grounds but calls into question their relative merits on economic grounds.

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  • Kilby, Christopher, 2005. "Donor Influence in MDBs: the Case of the Asian Development Bank," Vassar College Department of Economics Working Paper Series 70, Vassar College Department of Economics.
  • Handle: RePEc:vas:papers:70
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    File URL: http://irving.vassar.edu/VCEWP/VCEWP70.pdf
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    1. Robert K. Fleck & Christopher Kilby, 2006. "World Bank Independence: A Model and Statistical Analysis of US Influence," Review of Development Economics, Wiley Blackwell, vol. 10(2), pages 224-240, May.
    2. John Hickman, 1993. "Cue Taking and the Distribution of Japanese ODA among African Countries," African Development Review, African Development Bank, vol. 5(1), pages 62-69.
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    9. Trumbull, William N & Wall, Howard J, 1994. "Estimating Aid-Allocation Criteria with Panel Data," Economic Journal, Royal Economic Society, vol. 104(425), pages 876-882, July.
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    Cited by:

    1. Axel Dreher & Jan-Egbert Sturm, 2012. "Do the IMF and the World Bank influence voting in the UN General Assembly?," Public Choice, Springer, vol. 151(1), pages 363-397, April.
    2. Axel Dreher & Peter Nunnenkamp & Rainer Thiele, 2008. "Does US aid buy UN general assembly votes? A disaggregated analysis," Public Choice, Springer, vol. 136(1), pages 139-164, July.
    3. Koch, Dirk-Jan & Dreher, Axel & Nunnenkamp, Peter & Thiele, Rainer, 2009. "Keeping a Low Profile: What Determines the Allocation of Aid by Non-Governmental Organizations?," World Development, Elsevier, vol. 37(5), pages 902-918, May.
    4. Thiele, Rainer & Nunnenkamp, Peter & Dreher, Axel, 2006. "Sectoral aid priorities: Are donors really doing their best to achieve the millennium development goals?," Kiel Working Papers 1266, Kiel Institute for the World Economy (IfW).
    5. Dreher, Axel & Gassebner, Martin, 2008. "Does political proximity to the U.S. cause terror?," Economics Letters, Elsevier, vol. 99(1), pages 27-29, April.
    6. Robert K. Fleck & Christopher Kilby, 2006. "World Bank Independence: A Model and Statistical Analysis of US Influence," Review of Development Economics, Wiley Blackwell, vol. 10(2), pages 224-240, May.
    7. Anwar, Mumtaz, 2005. "The Political Economy of International Financial Institutions? Lending to Pakistan," HWWA Discussion Papers 338, Hamburg Institute of International Economics (HWWA).
    8. Rainer Thiele & Peter Nunnenkamp & Axel Dreher, 2007. "Do Donors Target Aid in Line with the Millennium Development Goals? A Sector Perspective of Aid Allocation," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 143(4), pages 596-630, December.
    9. Pincin, Jared, 2012. "Foreign aid and political influence of the development assistance committee countries," MPRA Paper 39668, University Library of Munich, Germany.
    10. Bakaykina, Anna, 2015. "The estimation of the competitiveness of SME financing programs of development banks in Russia," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 40(4), pages 106-128.
    11. Dreher, Axel & Sturm, Jan-Egbert & Vreeland, James Raymond, 2009. "Development aid and international politics: Does membership on the UN Security Council influence World Bank decisions?," Journal of Development Economics, Elsevier, vol. 88(1), pages 1-18, January.
    12. Dreher, Axel & Sturm, Jan-Egbert & Vreeland, James Raymond, 2009. "Global horse trading: IMF loans for votes in the United Nations Security Council," European Economic Review, Elsevier, vol. 53(7), pages 742-757, October.
    13. Dreher, Axel & Gehring, Kai & Klasen, Stephan, 2015. "Gesture Politics or Real Commitment? Gender Inequality and the Allocation of Aid," World Development, Elsevier, vol. 70(C), pages 464-480.
    14. repec:zbw:ifwkie:3881 is not listed on IDEAS
    15. Dreher, Axel & Nunnenkamp, Peter & Thiele, Rainer, 2010. "Are 'new' donors different? Comparing the allocation of bilateral aid between non-DAC and DAC donor," Center for European, Governance and Economic Development Research Discussion Papers 96, University of Goettingen, Department of Economics.
    16. Axel Dreher & Peter Nunnenkamp & Rainer Thiele, 2010. "Are 'New' Donors Different?," KOF Working papers 10-255, KOF Swiss Economic Institute, ETH Zurich.
    17. Dreher, Axel & Sturm, Jan-Egbert & Vreeland, James Raymond, 2007. "Does membership on the UN Security Council influence IMF decisions? Evidence from panel data," Proceedings of the German Development Economics Conference, Göttingen 2007 4, Verein für Socialpolitik, Research Committee Development Economics.

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