Over the last two decades, national development agencies have committed to results-based approaches and to putting evidence at the centre of their decision-making. For evidence “optimists”, this is a much-needed corrective to past practice; in contrast, “pessimists” worry about ideology...

This paper shows that donors that maximize relative aid impact spread their budgets across many recipient countries in a unique Nash equilibrium, explaining aid fragmentation. This equilibrium may be inefficient even without fixed costs, and the inefficiency increases in the equality of donors'...