The Milan conference of the UN Framework Convention on Climate Change has established two types of emission offsets under the Clean Development Mechanism (CDM), valid for afforestation and reforestation activities. In order to account for the non-permanent nature of carbon storage in forests,...

Greenhouse gas (GHG) removals by afforestation and reforestation project activities under the Kyoto Protocol?s Clean Development Mechanism (CDM) are vulnerable to a variety of risks and uncertainties, resulting in the partial or total reversal of such removals. Hence, GHG removals from these...

Afforestation and reforestation (AR) projects in the Clean Development Mechanism are able to create emission permits that can be accounted against the industrialized countries? commitments for limiting their greenhouse gas emissions, as agreed under the Kyoto Protocol. The discussion of how to...

Can process conditionality really enhance poverty reduction in developing countries? This question is addressed in the framework of a politico-economic model considering political distortions both on the recipient and on the donor side. It turns out that process conditionality is a very useful...

Donor agencies invest considerable financial and human resources to evaluate the outcome of their development activities. To derive institutional conditions conducive to an efficient use of these resources, we develop a multi-level principal-agent model focusing on the various interests of the...

This paper analyzes the determinants of international financial institutions (IFIs)?s lending decisions to Pakistan. At the example of three major IFIs, the World Bank, IMF and ADB, this paper suggests that political economic factors, notably bureaucratic interest of international civil servants...

The paper compares different aid policy instruments and their effect on the target group. Starting from a situation where interest groups compete for the resources of the government, international financial institutions aim to change the policy outcome. They can either directly support one group...

Variations of bilateral aid flows are difficult to explain on the basis of official development objectives or recipient need. At the example of US aid to Pakistan, this paper suggests alternative political economic explanations, notably the relevance of ethnic lobbying and the relevance of US...

An important feature of aid to developing countries is that it is given to the government. As a result aid has the potential to affect budgetary behaviour. Although the (albeit limited) aid-growth literature has addressed the effect of aid on policy, it has tended to neglect the effect of aid on...

Does official aid pave the road for private foreign investment or does it suffocate private initiative by diverting resources towards unproductive activities? In this paper we explore this question using data for a large number of developing and emerging economies. Controlling for countries?...