We investigate donor–beneficiary relationships in participatory development programmes, where (i) communities are heterogeneous and dominated by the local elite, (ii) the elite strategically proposes a project to the donor, knowing that the latter has imperfect knowledge of the needs of the...

Do elites capture foreign aid? This paper documents that aid disbursements to highly aid-dependent countries coincide with sharp increases in bank deposits in offshore financial centers known for bank secrecy and private wealth management, but not in other financial centers. The estimates are...