"Politics rules. Whether we like it or not, we are subject to politics wherever we go and whatever we are doing. Development is always and everywhere political, and frequently occurs with the interests of the powerful at the forefront. Can we hope to better understand the politics that shapes...

This paper investigates the macroeconomic challenges created by a surge in aid inflows. It develops an analytical framework for examining possible policy responses to increased aid, in terms of absorption and spending of aid - where the central bank controls absorption through monetary policy...