Modelling aid allocation : issues, approaches and results

There is a widespread view that political criteria have received less emphasis in aid allocation since the end of the cold war, with a greater share of aid subsequently being based on developmental criteria. An observed increase in aid effectiveness is attributed to this shift. A reasonably large literature on aid allocation supports this view: a number of influential, widely cited studies conclude that developmental criteria played no role in the 1970s and 1980s inter-recipient aid allocation. This paper argues that the shift is not as significant as commonly thought. It points to a number of methodological weaknesses in the dominant modelling approach used within the literature, showing that more rigorous econometric methods suggest that developmental criteria have had a larger influence on cold war period aid allocation than previously thought. An alternative interpretation of the observed increase in aid effectiveness is provided.

Development aid : a fresh look

This book addresses a number of gaps in knowledge on aid allocation and effectiveness, and provides many new and important analytical insights into aid. Among the topics covered are the interface between aid allocation and perceptions of aid effectiveness, the inter-recipient concentration of aid from non-govenment organizations, the year-on-year volatility of aid, impacts of aid on public sector fistcal aggregates, and evaluation of the country-level impacts of aid. The book is an essential companion for professionals engaged in aid policy reforms and also for scholars in the areas of development economics, international finance and economics.

Foreign aid, wage inequality and welfare for a small open economy with tourism

While the welfare effect of foreign aid has been extensively analyzed, the impact on the distribution of income has received less attention. At the same time, there has been recent work on tourism where it is complementary to aid in improving welfare.By combining these two strands, this paper concentrates on wage inequality in developing countries.We find that an increase in aid in the form of tied aid can lower the relative price of nontraded goods. The rent extracted from tourists declines, reducing welfare of domestic residents. In addition, the fall in the nontradable price can widen the wage inequality between skilled and unskilled workers.Thus, increased foreign aid may have detrimental effects on national welfare and the distribution of income. Rising wage inequality is confirmed by numerical simulations.

External policy influence and higher education reform in Ethiopia : understanding symbolic power of the World Bank

Increasingly national policy processes are intersected with and affected by global policy actors and ideas. In aid-recipient countries such as Ethiopia, donors use financial and non-financial means to influence national policy decisions and directions. This paper is about the non-financial influence of the World Bank (WB) in the Ethiopian higher education policy reform. Using Pierre Bourdieu’s concept of symbolic power as a ‘thinking tool’, the paper aims to shed light on forms of symbolic capital that the Bank uses to generate a ‘misrecognisable’ form of power that regulates the HE policy process in Ethiopia. The findings show that the WB transforms its symbolic capital of recognition and legitimacy to establish a ‘shared misrecognition’ and thereby make its policy prescriptions implicit and hence acceptable to local policy agents. The Bank uses knowledge-based regulatory instruments to induce compliance to its neoliberal policy prescriptions. The paper therefore underscores the value of symbol power as an analytical framework to understand elusive but critical role of donors in policy processes of aid recipient countries.

‘Knowledge aid’ as instrument of regulation: World Bank’s non-lending higher education support for Ethiopia

In the context of low-income countries, the role of donors in public policymaking is of great importance. Donors use a combination of lending and non-lending instruments as pathways of influence to shape policy directions in aid-recipient countries. This paper reports some findings from a doctoral study on the role of the World Bank in the recent higher education (HE) policy reform process in Ethiopia. It focuses on the nature and impact of non-lending assistance by the Bank to the Ethiopian HE subsystem. Based on an interpretive policy analysis of sector reviews and advisory activities of the Bank, and selected national HE policy documents, the following findings are highlighted. First, as a ‘knowledge institution’, the World Bank produces, systematises and disseminates knowledge through policy advice, policy reports, analytical sector reviews, and thematic conferences and workshops. Second, knowledge aid from the Bank not only has a profound discursive effect on shaping Ethiopian HE policy reform priorities in accordance with its neoliberal educational agenda but also undermines the knowledge production capacity of the nation. The paper also argues that, for an effective education policy support, the Bank needs to shift its modality of engagement from knowledge aid to research capacity building. 

Performance assessment, vulnerability, human capital, and the allocation of aid among developing countries

Developing country performance with respect to economic policies and institutional behavior is a common criterion for the allocation of aid among recipient countries. This paper examines how performance is used, arguing that performance is too narrowly defined. A more appropriate definition is one that controls for the economic vulnerability and human capital of developing countries. Econometric analysis of cross-section and panel data is presented that supports this contention. The paper also contends that performance and exogenous economic shocks are likely to be pro-cyclical. This implies a double punishment when aid is allocated according to performance. Evidence of such punishment is also provided. The paper concludes by arguing that economic vulnerability and human capital variables should augment performance measures in aid allocation decision-making.

Navigating scientific uncertainty in wildfire and flood risk mitigation: a qualitative review

Natural hazards are complex events whose mitigation has generated a diverse field of specialised natural science expertise that is drawn upon by a wide range of practitioners and decision-makers. In this paper, the authors bring natural science research, risk studies and science and technology studies together in aid of clarifying the role scientific uncertainties play in the mitigation of natural hazards and their associated risks. Given that uncertainty is a necessary part of scientific practise and method, those engaged in risk mitigation must manage these scientific uncertainties in their decision-making just as, equally, social science researchers, stakeholders and others hoping to understand risk mitigation must understand their character and influence. To this end, the authors present the results of an extensive literature review of scientific uncertainties as they emerge in relation to wildfire and flood risk mitigation in Australia. The results are both a survey of these major uncertainties and a novel categorisation within which a variety of expert and non-expert audiences might discuss and translate the scientific uncertainties that are encountered and managed in risk mitigation.

Empowering primary care to tackle the obesity epidemic: the Counterweight Programme

Subjects: Obese patients (body mass index greater than or equal to30 kg/m2) or BMIgreater than or equal to28 kg/m2 with obesity-related comorbidities in 80 general practices.

Intervention: The model consists of four phases: (1) audit and project development, (2) practice training and support, (3) nurse-led patient intervention, and (4) evaluation. The intervention programme used evidence-based pathways, which included strategies to empower clinicians and patients. Weight Management Advisers who are specialist obesity dietitians facilitated programme implementation.

Main outcome measures: Proportion of practices trained and recruiting patients, and weight change at 12 months.

Results: By March 2004, 58 of the 62 (93.5%) intervention practices had been trained, 47 (75.8%) practices were active in implementing the model and 1549 patients had been recruited. At 12 months, 33% of patients achieved a clinically meaningful weight loss of 5% or more. A total of 49% of patients were classed as 'completers' in that they attended the requisite number of appointments in 3, 6 and 12 months. 'Completers' achieved more successful weight loss with 40% achieving a weight loss of 5% or more at 12 months.

Conclusion: The Counterweight programme provides a promising model to improve the management of obesity in primary care.

Sponsorship: Educational grant-in-aid from Roche Products Ltd.

Are state–local government expenditures converging? New evidence based on sequential unit root tests

Large and persistent gaps in subnational public expenditure have important implications regarding growth, equity, and migration. In this context, we revisit the question of expenditure convergence across the American states to provide more nuanced evidence than found by a small number of previous studies. We employ a methodology due to Smeekes (Bootstrap sequential tests to determine the stationary units in a panel, 2011) that sequentially tests for unit roots in pairwise (real per capita) expenditure gaps based on user specified fractions. In a panel of 48 combined state–local government units (1957–2008), we found that expenditures on highways, sanitation, utility, and education were far more convergent than expenditures on health and hospitals, police and fire protection, and public welfare. There was little evidence of “club convergence” based on the proportion of intraregional convergent pairs. Several historically high-grant receiving states showed relatively strong evidence of convergence. Our results bode well for future output convergence and opportunities for Tiebout-type migration across jurisdictions. They also imply a diminished role for public infrastructure and education spending in business location choices over time and a mixed role for federal grants in inducing convergence.

The World Bank and higher education reform in Ethiopia: knowledge aid and its undesirable effects

This chapter critically examines World Bank (WB) support for Ethiopia, specifically for its higher education (HE) system. It is now almost commonplace for support for developing nations from International Organizations (IOs) such as the WB to be the subject of analysis and critique. Reasons for this are not difficult to discern, particularly in relation to the WB 's activities. This is because the WB is the largest external financial source for educational expenditure in developing countries in general and in Sub-Saharan Africa (SSA) in particular (Jones 2007). In fact, the Bank provides about a quarter of all external funds for education in low-income countries (LICs) (Domenech and Mora-Ninci 2009). In twenty years (1990-2010), the WB committed a total of nearly US$42 billion for education (Molla 2013b). Poor countries with low annual per capita income are eligible for the WB 's financial aid, which includes concessional outright grants and interest-free long-term loans (World Bank 2007a).