We document that, in rural Uganda, the entry of foreign aid reduces government provision of similar services because the organization that delivers aid often hires the government worker, thereby reducing state capacity. Access to any public services and population well-being worsen in villages...

In this paper I discuss the effectiveness of foreign aid from a historical perspective. I show that foreign aid is a relatively new concept in economics, and I emphasize the role of exchange rate policies in the foreign aid controversies of the 1970s through 1990s. I show that in the early 1980s...