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).

Understanding what microfinance institutions need to address to aid poverty alleviation, social inclusion and human development

Poverty, in its most basic form can be defined as a deprivation of well-being. It is an issue that has been evident in society for centuries and a concern for government policy makers and more recently for non-government organizations (NGOs). In this paper, we consider how management approaches to resolving the dilemma of poverty can be advanced by drawing on two major areas in the development arena associated with poverty, namely, ‘social exclusion’ and ‘the human development paradigm’. We put forward the argument that for groups of people where social disintegration has already occurred, only structural interventions coupled with a social development mechanism will achieve the desired effect. One method for achieving this is through the use of microfinance programs which provide a broad range of financial services to the poor and low-income households as well as to micro-enterprises. This paper contributes to both management practice and theory by developing a theoretical model that microfinance institutions need to do to aid both ‘human development’ and ‘social inclusion’ processes for the socially excluded and poor.

Donor funding of multilateral aid agencies : determining factors and revealed burden sharing

This paper reports an empirical study of the factors affecting burden sharing among OECD's 22 DAC members in 'bankrolling' the multilateral aid agencies. Annual data over 1970–2000, pooled across the donor countries, form the basis for the empirical estimation of each donor's share in the ODA aid receipts for each multilateral agency. Our findings suggest the existence of reverse exploitation, i.e., the financial burden of the agencies is disproportionally carried by the smaller donors. The study also finds that factors such as inherent donor generosity, donor concern for domestic egalitarianism, and the extent to which donors are pro-poor in their bilateral aid policies have an impact on their readiness to support multilateral agencies financially. Size of the donor government and its budgetary balance positively influence burden sharing of contributions to other multilateral agencies. But neither the phase of economic cycle nor the rate of economic growth affects the burden-sharing responsibility of donors. It was also observed that contributions by EU members to the EC do not appear to crowd-out their contributions to other multilateral aid agencies and that right-wing donor governments are generally more parsimonious with regard to financial assistance to multilateral aid agencies. The preferred alternative, particularly among EU member countries, appears to be the EC.

Vulnerability, trade, financial flows and state failure in small island developing states

Small Island Developing States (SIDS) are very different to other developing countries. Relative to GDP they have the highest levels of foreign trade and aid receipts of all developing countries. Remittances from abroad are a far more important source of income for SIDS, and some depend very heavily on export revenues. The quality of governance varies tremendously among SIDS, they are over-represented among countries classified as fragile states and many are prone to state failure. These and other factors combine to make SIDS highly vulnerable to external economic shocks. Achieving development in SIDS is as a consequence an especially complex task that requires an understanding of the roles played by aid, trade, remittances and governance in these countries. This paper looks at these issues, along with providing various stylised facts about SIDS. In so doing it serves as a background and broad contextual setting for the papers that follow in this Special Issue on 'Fragility and Development in Small Island Developing States'.

Financial systems and mechanisms of growth in different conditions of country risk

This article uses panel data from 1976 to 2003 to investigate the ways in which banking and stock markets influence economic growth in situations of high and low country risk. The mean and Standard Deviation (SD) of country risk are adopted to classify 28 countries into Low Risk Low Volatility (LRLV) and High Risk High Volatility (HRHV) subgroups. Through the technique of error correction-based panel co-integration developed by Westerlund (2007), several results are obtained. First, LRLV countries can expand the capitalization of stock market to enhance long-term economic growth. Second, HRHV countries, on the other hand, use two distinct strategies to promote long-term economic growth. Initially they develop their equity markets, which promote economic growth directly. Strengthened equity markets, in turn, aid in the development of credit markets, which subsequently brings an economic boom. Finally, regardless of selected subgroups, the contribution of stock market capitalization to economic growth appears to be substantially larger than that of bank credit, highlighting the importance of stock markets.

Competing development paradigms and alternative evaluations of aid effectiveness: challenging the dominant neoliberal vision

In the period since the end of the Second World War, thinking about the ways in which development takes place and can be fostered has gone through a series of fundamental shifts, and in each of the paradigms that have been dominant at particular times the role of aid has been given a quite different emphasis. In this chapter the nature of each of these major periods in development thinking is outlined, along with an exploration of changing priorities for aid policy, and hence of the criteria that might be used to evaluate aid effectiveness. The aim, then, is to develop an understanding of the political economy of aid policy, moving well beyond restricted economic criteria to encompass political considerations as well as insights from a range of other disciplines. Particular attention is given to the current neoliberal agenda, which in spite of many attacks since the Global Financial Crisis has retained its dominant position. It is argued that this produces a development and aid agenda that enhances a starkly unequal income distribution, and that ways in which a new paradigm that places more emphasis on the common good can be created must be explored.