Development assistance is meant to improve the lives of poor people in developing countries, but the effectiveness of aid in meeting this goal is uncertain. Demonstrating failure — or success — is difficult because traditional donor financing mechanisms track inputs, not results. This is...

Is generalized debt relief an effective development strategy, or should assistance be tailored to countries' characteristics? To answer this question, the authors build a simple model in which recipient governments reveal their creditworthiness if donors offer them to choose between aid and debt...

This paper documents that developing countries with opaque institutions receive procyclical development aid and procyclical promises of future aid while developing countries with transparent institutions receive countercyclical aid. It provides a dynamic equilibrium model of optimal aid policy...

In the last few years, numerous econometric studies have unearthed evidence of donor influence over the geographic distribution of funds from international financial institutions (IFIs). Scholars are now beginning to use quantitative methods to delve into the details of donor influence to...

This paper uses econometric analysis to show that the fragmentation of bilateral donors' aid across many recipients tends to raise their administration costs. It then develops an aid allocation model to show how bilateral donors can become much more specialized in terms of which recipients they...

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'...

Autocrats experiencing a windfall in unearned income may find it optimal to donate to other countries some of the windfall in order to make the state a less attractive prize to potential insurgents. We put forward a model that makes that prediction, as well as the additional predictions that the...

Purpose – Although the crucial role of business, and of business-based approaches, in development is increasingly emphasised by academics and practitioners, we lack insight into the ‘whether and how' of viable business models, in environmental, social and economical terms. This article...

The efforts of international financial institutions such as the World Bank to support countries in the effective capture and use of revenues from extractive industries have focused increasingly on transparency, notably through the Extractive Industries Transparency Initiative. In this article,...

This paper describes some policy instruments set up by the IMF and the European Union in order to provide financial assistance to developing countries whose economies are affected by exogenous shocks from exports side. After briefly reviewing the IMF's CFF and the EU's STABEX, the paper presents...