European countries pride themselves on being leaders in spurring development within poor countries. We find that Europe's approach to development could be characterised as energetically tackling the symptoms of poor economic opportunities for developing countries by providing effective aid,...

Recent literature contains many stories of how foreign aid affects economic growth: aid raises growth in countries with good policies, or in countries with difficult economic environments, or mainly outside the tropics, or on average with diminishing returns. The diversity of these results...

The Difference and System generalized method of moments (GMM) estimators are growing in popularity, thanks in part to specialized software. But as implemented in these packages, the estimators easily generate results by default that are at once invalid yet appear valid in specification tests....

Researchers have written hundreds of papers on the causes and consequences of official foreign aid, while paying almost no attention to private overseas giving, by individuals, universities, foundations, and corporations. Yet private giving is significant - some $15.5 billion/year, compared to...

CGD research fellow David Roodman and Uzma Qureshi analyze microfinance institutions (MFIs) as businesses, asking how some succeed in covering costs, earning returns, attracting capital, and scaling up. We draw on existing literature and interviews with industry players and academics. Key...

The Commitment to Development Index of the Center for Global Development rates 21 rich countries on the "development-friendliness" of their policies. It is revised and updated annually. In the 2004 edition, the component on foreign assistance combines quantitative and qualitative measures of...

The cross-country literature on foreign aid effectiveness has relied on the use of instruments to distinguish causality from mere correlation. This paper uses simple non-instrumental techniques in the spirit of Granger to demonstrate that the main aid-growth connection is a negative causal...

A challenge in the development of aggregate indexes of trade protection is finding weights to put on various tariffs that a) reflect their importance to exporters and b) are not endogenous to the protection being measured. One common basis for weights is actual imports; but these, as is...

At a time when the international dialogue surrounding development is focused on increasing the quantity of aid, this paper focuses on how the donor community can improve the quality of foreign assistance. The author discusses the problem of project proliferation, and the tendency of developing...

The proliferation of aid projects may overburden recipient governments with reporting requirements, donor visits, and other administrative overhead, siphoning off scarce domestic recipient resources, such as tax revenue or the time of skilled government officials, from directly productive use....