When every argument begins with “is it better than cash?”

"Where the hell is the Jaeger?" "Oh the government couldn't figure out how to evaluate the anti-Kaiju programme, so they just do cash transfers now."

“Where the hell is the Jaeger?” “Oh the government couldn’t really figure out how to evaluate the giant robots-fight off giant aliens programme, so they basically just do cash transfers now.”

Kevin Grier grumbles about the IDA, arguing that its investments couldn’t possibly stack up to cash transfers:

The last 3 year replenishment of IDA was for 49.3 billion dollars. So for a decade of IDA, we can use 150 billion dollars as a cost number. People, for $150 billion dollars, you could give 75 million people each $2000 in cold hard cash. From my point of view, that sounds a lot better than giving them “access” to services. Now sure, there are aid agencies worse than the IDA (phone call for USAID), but there is nothing in Mombrial’s post that backs up his claim that the IDA is a good investment, and in my opinion, it’s actually a bad investment relative to unconditional cash transfers.

Even without the growing body of empirical evidence indicating that just giving cash is an incredibly cost-effective way to increase welfare, there is an extremely compelling theoretical case to be made for cash transfers. Poor households have preferences (replace these with `needs’ if you are so inclined, although there are important distinctions between the two), and no one will ever have better information on these preferences than these households. Transferring households cash allows them to best allocate these new resources to meet these preferences – otherwise, we run the risk of wasting resources on stuff that households just don’t want.* Combine this with the fact that cash transfers are getting quite easy to make, especially in the era of mobile money, and they appear to be a reasonable standard by which to compare all other interventions.

Yet, the most ardent supporters of cash transfer programmes often forget that many societies (read: all societies) are still struggling with pretty severe collective action problems which inhibit the provision of public goods. It’s far from clear that distributing cash will solve these problems: if a village of people haven’t banded together and produced a well-functioning school by now, although giving them cash certainly increases their purchasing power to do so, it’s unlikely to solve the basic collective action problem resulting in the failure to produce the school.

This is important, as there are a range of public goods (or semi-private goods which have substantial externalities) which we can imagine might increase welfare a great deal more than a cash transfer of equivalent cost: schools, health facilities, roads, a functioning police force. Basically, any semblance of a local or national state. How many of you would vote for your own government to transfer its entire budget evenly across the population and then shut down all its operation for good? It certainly would make it easier to pay the rent next month, if your apartment complex hadn’t been burned down by the marauding hordes yet.

Now, if the collective actions problems we care about have already been solved by the market, we should be less worried. Despite a steady flow of misinformed rhetoric from NGOs suggesting that private schools in developing countries are a distraction, there is a great deal of evidence suggesting that in settings where the state is failing to provide quality schooling, private schools present a reasonable (and probably strictly superior) alternative for poor families. In these settings, unconditional cash transfers should be enough. However, there are going to be a lot of contexts where markets are not filling these gaps. For example, rural health clinics tend to be the preserve of government or NGO work, rather than the private health sector, so the effect of income on health outcomes in these contexts is going to be more complex.

The hypothesis “is intervention X better than cash?” is relatively easy to test for a whole slew of interventions: run an RCT and see if this is the case. Yet, while development economists are getting quite good at making and replicating these comparisons for private or small-scale interventions, many of the large public-good investments that have the potential for a large payoff remain difficult to convincingly empirically evaluate (I am somewhat optimistic that we will get there, but we’re certainly not there yet). The current bias towards cash represents not only a positive assessment of the returns to these types of interventions, but also a preference for interventions that can easily be shown to work.

Yet we know that public goods matter and that cash-transfers, to the extent that they cannot be taxed by the state, are unlikely to help in this regard. Multilateral lending/aid organisations like the IDA tend to focus more on projects which have some public good element, such as infrastructure. Whether or not these organisations are any good at producing successful, cost-effective projects is certainly a question we should be asking. But the choice that Grier presents us with is a false one: that we must choose between wasteful public good spending and cash, as if the cash-only equilibrium is the only one that could ever make any sense.

I am frequently guilty of wheeling out the “but is it better than cash?” argument whenever I see an intervention which looks wasteful or too paternalistic** for my taste, but we should be cautious not to use cash transfers as the appropriate gold standard for every intervention. There are plenty of public-good-type interventions which are (currently) hard-to-measure but important. Whether or not aid donors and governments are any good at funding these interventions should be the starting point for the discussion.

*I’m ignoring a lot of potential problems here by using households instead of people, as well as ignoring issues with time-inconsistency, etc, because I want to focus on one particular argument in this post.

**There are those that doubt the efficacy of unconditional cash transfers due to concerns over the ability of households to discern what they should be spending the money on. These concerns are not entirely unfounded – we are all subject to a variety of cognitive biases which can lead to suboptimal decisions. I choose to ignore these concerns here, not because I don’t think that they apply, but because I’m pretty skeptical that aid agencies and charities would be better at determining optimal private expenditure patterns than households.

Value for money and presidential trips

"Sorry Kah-El, your field trip to earth has been denied - instead we're going to channel the funds into more schools on Krypton."

“Sorry Kah-El, your field trip to earth has been denied – instead we’re going to channel the funds into building more schools on Krypton.”

Michael Kevane grumbles about the cost of Obama’s upcoming ten-day trip to Senegal, Tanzania and South Africa, which is projected to cost a hefty $100 million, pointing out the money could be put to better use:

I always like to do the basic math.  We (FAVL) set up village libraries for about $15,000 and that covers about five years of operations until the office of the mayor can take over.  Let’s say there is no book renewal or much maintenance afterwards… still you get about 10 years of 500 villagers reading a lot.  How many villages?  Well, 100 million divided by $15,000 is 6,666… so village libraries could be established pretty much across the entire Sahel, for this one ten day trip… What do you think about that?  Maybe President Obama can just make a Skype call instead?  Oh wait, those are tapped by NSA.

I sympathise with Kevane’s argument here and find it difficult to swallow that a presidential visit should cost $10 million a day. That said, it’s very difficult to assess the value of diplomatic trips, and using a strict “we could have spent that money on my favourite intervention X”, might not be the most appropriate way to judge every single policy decision. This may be an entirely useless bit of PR (and I would guess it it probably will be), but it could also pay off in unknown ways for both the US and for the countries Obama is visiting. For example, some have suggested that Obama’s visit to Ghana several years ago boosted tourism (although these things are, frankly, pretty hard to pin down). Actually, given that someone has already done research on the effects of papal visits, I’m surprised that no one appears to have done any work on the economic impact of international presidential visits on receiving countries.

It’s also worth pointing out that budget ceilings were probably set a long time ago: this exorbitant trip is likely pulling a money away from other State Dept/intelligence budgets (strongly suggested in this Washington Post article also highlighting the price tag on the trip).  However, if we’re going to be moving into fantasy territory, I can think of more reasonable targets than establishing closer ties to African countries: why don’t we pull out of fucking Afghanistan right now and spend all that money on development aid?

Hat tip to Roving Bandit for the link.

We have a pope, now eat your vegetables

"Did you finish your plate?" "I did, I swear to God" "SWEAR TO ME"

“Did you finish your plate?” “I did, I swear to God” “SWEAR TO ME”

When I was young and fickle, my grandmother would sometimes admonish me for not finishing my plate. “Think of all the starving children in Africa!” she would say, in an attempt to use guilt to motivate me. My reply, which usually ended the conversation, was: “Why don’t you pack it up and send it to them then?”

I was about eight years old then, so I had since considered the argument to be settled. Not so fast! Pope Francis tags in and slides into the ring to set things right:

Pope Francis on Wednesday denounced what he called a “culture of waste” in an increasingly consumerist world and said throwing away goodfood was like stealing from poor people.

“Our grandparents used to make a point of not throwing away leftover food. Consumerism has made us accustomed to wasting food daily and we are unable to see its real value,” Francis said at his weekly audience in St Peter’s Square.

“Throwing away food is like stealing from the table of those who are poor and hungry,” he said.

I must admit, I have a hard time dealing with the concept of a new pope. I was born in the early 80s, so John Paul II is very much the `canonical’ pope in my mind, the same way that, well, the Tim Burton/Michael Keaton Batman is the original Batman. The brief, tempestuous tenure of Pope “Ratzinger” Benedict can be likened to the strange turn that the Batman films took in the late 90s, when Joel Schumacher took the reigns of the franchise, Robin showed up and the Batsuit acquired nipples. Given his focus on poverty, I really want to like this new pope – he has a leanness and focus which isn’t a million miles off from Christopher Nolan’s interpretation of Batman, but unfortunately he carries all the same self-serious baggage that sometimes weighed down the last few films.

But I digress. There are two potential reasons why we might consider wasting food to be odious. The first is that there is something morally unacceptable about waste when there are those that are suffering, regardless of whether or not the excess food could be transferred. The second is that somehow food wastage has a direct impact on those that are hungry (more or less what Christian Bale, I mean Pope Francis, is suggesting in the last quote).

The first criticism might hold some water if it was more commonly applied to other contexts than food, but it almost never is. How often have you used money less efficiently that you might have? For example, by booking a train later than you should have, or having that extra pint that you probably didn’t need? Aren’t you wasting money? Think of all the poor people who, by definition don’t have it. Or what about the time you sat in a class in university, and you failed to pay attention for five minutes – think of all the poor children of the world who don’t have university.

In reality, we human beings are fairly inefficient creatures, but often we’re inefficient in one domain so we can be efficient in other domains. I don’t spend a lot of time worrying about food wastage, so I might save money by avoiding waste. Then again, instead of spending time working to avoid waste, I might spend it working more, the returns to which (including those to charitable causes) might actually be higher.  Given that the reasons for food wastage are quite varied, and there is no easy redistribution mechanism (I can’t ship my leftover pasta to Ethiopia in time for consumption there), the first criticism doesn’t get us very far.

What about the second? Let’s assume that whatever cognitive biases or strategies that lead to food wastage could be eliminated, tomorrow. What would happen? Assuming this is a purely demand-side effect, we should see a decrease in the price of food. Whether or not this will lead to a net reduction in hunger is an extremely complex and difficult question, as the world is full of poor people who are net producers AND net consumers of food. Whoever works on a banana plantation might be happy that occasionally I over-estimate how many bananas I can eat in a week.

The second criticism is even sillier given that there is plenty of more general wastage which, if re-directed, could easily help the poor. Spend too much of your time sitting around, not sure what you want to do? Volunteer at a charity! Have money that you’ve been blowing on clothes you don’t really like and won’t wear too often? Give it to a charity with a good track-record of helping the poor. Unless you are chowing down on a turkducken in the middle of a drought-stricken village, worry less about your food wastage and worry more about other ways you could be helping the poor.

Now, if you’ll excuse me, I’m going to print this blog out and mail it to my grandmother.

Super aid worker protection bracelet, activate!

craig

From the BBC:

A hi-tech bracelet could soon be helping civil rights and aid workers at risk of being kidnapped or killed. When triggered, the personal alarm uses phone and sat-nav technology to warn that its wearer is in danger. Warnings are sent in the form of messages to Facebook and Twitter to rally support and ensure people do not disappear without trace.

A few quick thoughts/questions:

  1. The objective here is to dissuade both murder and kidnapping of aid workers/advocates. What if murder and kidnapping are substitutes, not complements? Won’t this make it relatively less costly for attackers to just shoot their targets, even if it had some general deterrent effects?
  2. If you are wearing this bracelet, isn’t this a signal that you are worth kidnapping?
  3. If the bracelet is successful in deterring kidnappings and murders, what externalities are we imposing on non-bracelet holders? What’s the equilibrium here?
  4. As a friend pointed out on Facebook, “that sounds like a good way to get your arm chopped off”

Aid as policy

empire

“”The Empire is evil”? Don’t you realise what a silly statement that is? The Empire is actually a complex system of carefully targeted programmes and government departments. You should be asking specific questions like: “Is the Empire’s Death Star project effective at curbing population growth?””

Lee Crawfurd over at The Roving Bandit recently wrote a compelling post about why the question “Does aid work?” is fundamentally flawed.

The question “does policy work” is jarring, because we immediately realise that it makes little sense. Governments have about 20-30 different Ministries, which immediately implies at least 20-30 different areas of policy. Does which one work? We have health and education policy, infrastructure policy (roads, water, energy), trade policy, monetary policy, public financial management, employment policy, disaster response, financial sector policy, climate and environment policy, to name just a few. It makes very little sense to ask if they all collectively “work” or are “effective”. Foreign aid is similar. Aid supports all of these different areas of policy. My colleagues and I at OPM work on aid-financed projects that support most of these different policy areas in different developing countries.

Lee, as he admits himself, is taking his cue from the combined work of Esther Duflo, Abhijeet Banerjee and Dean Karlan. Some policy questions are becoming more and more answerable: does X work in a given context is something that can be tested and applied. Lee is asserting that since aid is just used to fund policies, thus the question of whether aid works just boils down to the complex task of determining whether or not individual policies work.

Yet, when you examine this assertion a little further, it starts to fall apart. Let’s imagine we lived in a world where we, development economists from aid-giving countries, figured out all the good government policies. We knew exactly which actions developing country governments needed to take to save children’s lives, promote income and job creation, reduce hunger and conflict and so on. In the world which Lee has presented to us, policy works, because we knew what all the best policies were. Would aid work?

It certainly wouldn’t be guaranteed to. Aid isn’t just policy – it’s the transfer of financial resources and technical expertise from one country or entity to another. That transfer is inherently non-trivial: it can create huge differences in power, has the potential to distort the recipient’s decision-making, creates opportunities for rent-seeking and often is used for completely political purposes. We cannot, for instance, only judge a US-funded conditional cash-transfer programme in Afghanistan solely on its microeconomic impact – it has to be viewed within the context of the US’s ongoing military intervention in that country, and its likelihood of long-term success. The recent scrap between Rwanda and its donors over the security situation across the border in the DRC again shows that aid is vastly more complicated than simply choosing effective programmes.

Lee acknowledges some of these differences and potential problems, but then dismisses them as things which are hard to gather robust evidence on. This preference to stick to what we know is somewhat admirable and tempting, but ultimately dangerous: it is incredibly difficult to gather widespread, robust evidence on the effects of aid on the macroeconomy or on local political economy. This should make us more, rather than less, wary of possible deleterious effects.

I’m as equally horrified as Lee by the recent attention that right-wing attacks on aid have been getting in the UK, and I completely agree with him that aid cannot always be  judged as a whole. The question, “does aid work?” doesn’t get us very far in life, especially since we have little concept as to what metric we should be using. That said, we have to tread carefully around the argument that small, neat questions are sufficient for success. I agree that aid should be considered more carefully as a bundle of heterogeneous flows and relationships, but I also believe that “aid” is unique in several key ways, and it is only healthy if we continuously question whether the the things that make aid unique also undermine its effectiveness.

How policies end: not with a bang, but a whimper

Masimba Tafirenyika describes how dire the food security situation in Malawi has become:

Once again Malawi finds itself in a tight spot. A food crisis set off by erratic rains, rising food prices and economic hardships is slowly unfolding. For the first time in several years, the country’s ability to feed its citizens is at risk. Sadly and unexpectedly, Malawi has lost its hard-earned status as an agricultural success story — it used to produce enough maize for its people to eat and still provide a surplus to neighbours. Many are now wondering what went wrong and whether there could be lessons for other African countries.

More than 1.63 million people, or 11 per cent of the population, are facing severe food shortages, according to the World Food Programme, a UN relief agency. Malawi needed $30 million to the end of 2012 to cover the shortfall.

As Tafirenyika hints, this stands in stark contrast to reporting on Malawi over the past few years, where it was heralded as a shining example of how to tackle food security. Five years, ago Celia Dugger wrote in the NYT how the country’s president, Bingu wa Mutharika, despite the protests of many, “ignored the experts” and subsequently dealt with the country’s hunger problems by drastically scaling up its fertiliser subsidy programme. Malawi subsequently enjoyed a spate of bumper harvests and many were quick to tout the large-scale subsidisation as being both a success and worth of replication in other countries. Most notable was the support of Jeffrey Sachs, who’s incessant belief that the fertiliser subsidisation was a policy holy grail led him to write an oddly-appreciative obituary for Mutharika, who died at the end of a thuggish, repressive and disastrous second term in office.

Meanwhile, hunger returns to Malawi, but we have not yet established a convincing narrative. Many economists (including a few on this blog) have pointed out, time and time again, that the fertiliser subsidy programme was fraught with pitfalls, both political and practical. While the recent crisis is probably too complex to fully substantiate these concerns, now would be an appropriate time for the fertiliser advocates to turn their attention to the food situation in Malawi, and begin to ask why. Otherwise, we risk touting a policy that might actually have been a complete failure, or at the very least lacked the sort of robustness that anti-hunger policies desperately need.

Panel beating

panel

Spot the speaker from a developing country. Oh wait, you can’t.

 

In response to the under-representation of women on speaking panels in the tech industry, Rebecca Rosen suggested that speakers pledge to only participate when there will be at least one female speaker. This spurred a fair amount of self-reflection from the development crowd on Twitter, neatly summed up and subsequently critiqued by Duncan Green:

They may not be as extreme as geeky tech events, but lots of development gabfests do indeed feature men on the panel talking to women (and men) in the audience. That violates basic fairness, inhibits the profile and (possibly) career development of half of the potential talent pool, and is likely to distort the agenda and resulting discussion (less focus on care economy, women’s rights etc).

I won’t dwell on the mechanism design here – although whether or not pledges would work and what the resulting equilibrium would be is certainly worth further thought. However, I will point out a more glaring inequity in the typical composition of development panels. Let’s see if you can spot it: above is a photo of a recent IIES panel on using aid to reduce world poverty. Can you spot the missing party?  Perhaps our pledges need to begin with geography before gender.

It’s good to be the president

history

Since the unexpected death of Bingu wa Mutharika, I’ve been rather hopeful for Malawi. While Mutharika had an incredibly promising start, his second term was marred with paranoia, aggression and growing signs of dynasty-building and patronage politics. Thanks to a heart attack, we were graced with Joyce Banda, the country’s first female president, who appears to be both modest and incredibly pragmatic, while naturally eschewing the big bwana syndrome while has characterized so much of Malawian politics.

Banda’s sudden appearance on the global scene has excited a lot of people. Perhaps unfairly, many consider her to be Malawi’s best chance of rising above the seemingly-endless cycle of dashed expectations. The Guardian recently ran a behind-the-scenes piece on her which, while captivating and well done, only serves to further entrench these hopes.

To a large extent I share these expectations, and was happy to hear that Banda had decided to sell off the presidential jet and cut the presidential salary to less than what an Oxford post-doc makes in a year. Then I chatted to my mother the other day, who pointed out to me that while watching a BBC show on the posh London hotel Claridge’s, she had spotted Ms. Banda’s husband, having booked for 11 nights with his entourage of fifteen people (it happens at about the 11 minute mark here). Indeed, it appears that Ms. Banda also stayed at Claridge’s during her first state visit to the UK, during which she made the announcement about selling off her jet. While rates for a basic room at Claridges are roughly £400, its suites (which the programme suggests the Bandas stayed in) can be as expensive as £3,000 a night. The doorman proudly quips “it is Mr. President,” referring to Joyce Banda’s husband, noting he had been to Claridges before.

Perhaps the Banda’s get a special a discount, or the donors ponied up the cash for their London stay, or perhaps Richard Banda has a good pension from serving as Malawi’s Chief Justice. Maybe it’s reasonable to expect heads of state to enjoy a little luxury. Still, it’s awfully good to be the president (or at least the president’s husband).

If I were British, I’d be proud of DFID

by Kate Orkin

Back home in South Africa, I’d probably score points for criticising donors as self-interested imperialists. My doctorate from the Department of International Development at Oxford has trained me to be highly critical of the aid sector. Nonetheless, I’d like to tell the anti-aid ranters in Monday’s Telegraph that if I were British, I would be proud as anything of DFID.

There are lots of arguments as to why aid should be delivered in the way DFID delivers it, and why Mr Pascoe is misinformed. Direct budget support is best practice because builds government capacity and ensures alignment with government priorities (and for an independent assessment of DBS, see here).  The worst disasters are poorly managed ones, and these are often rooted in poor governance or a lack of capacity, which won’t be fixed by more sacks of grain. Structures of patronage, illegitimate regimes, or a lack of government accountability are often propped up by repeated disaster relief, which Mr Pascoe advocates. And so on.

I’m not going to make those arguments here. I think the defenders of aid sometimes get so obsessed with showing results that they forget to talk about the human side of what they do.

So, firstly, I want to provide a counter to the ad hominem attacks directed at those in the aid sector, a “bunch of chancers and middle managers”. For the last four years I worked as a part-time research assistant for a research project which DFID co-funds and did a lot of fieldwork in Ethiopia. I don’t know the consultants subcontracted by DFID whom Mr Pascoe speaks about.[1] But I have watched DFID staff in action with critical eyes.

Whatever politically correct language they use, many donors are patronising of the African government staff they work with and see them as in need of “capacity building”. DFID staff members are often different. They build respectful, trusting relationships with government staff. In Ethiopia, they speak Amharic and learn the names of their counterparts’ children. Instead of summoning regional officials to the capital, they go on regular field visits. They speak about the country’s targets and priorities as their own. Donor representatives from other countries, whom I interviewed, speak with admiration about the ability of DFID staff to negotiate with government and their specialised expertise in the sector they work in, which is rare in donor advisors in “field” postings. The most talented Ethiopians in the NGO sector aspire to work at DFID, even though they would earn less than in other international organisations. That is a tremendous compliment.

Second, Mr Pascoe argues that British aid achieves objectives that “desirable but not necessary” and that beneficiary countries are doing fine without British help. India is the easiest example for him to choose, although inequality and poverty are often as bad in middle-income countries as poor ones, as argued here. The argument becomes less palatable when one examines countries like Ethiopia, the recipient of the second largest amount of British aid.

Allow me to tell you about the village where I did my PhD fieldwork in Ethiopia. Yes, the country’s human rights record is patchy. DFID withdrew its aid in 2005, and has reinstated it with conditions. But the government has been good at delivering social services with donor money and conditions for children are improving.

When I first visited in 2008, the school was woefully under-resourced: textbooks were shared between two or three children, teachers were often absent and the school only taught up to Grade 6. Partly in response to criticism that access to education had expanded without adequate attention being paid to quality, the government has embarked on an ambitious quality improvement programme, with DFID as the largest bilateral contributor. Country-wide, in 1991, roughly one in five children were in school. Today, that number is close to four in five.

In 2010, when I last visited, each child in the school had a textbook for each subject. The school had just received its school improvement grant directly from the district as part of the quality improvement programme and added it to parent contributions to build two new classrooms. The district allocated two teachers. Girls now complete primary school in the village. They are old enough that they can walk to the nearest town for secondary school without their parents worrying about their safety.

Ethiopian doctors earned dubious fame for their excellence in treating fistula, a debilitating injury in childbirth that is particularly common in very young or malnourished mothers. In 2010, 15-year-old girls in this village say that early marriage is illegal, want to delay marriage until they complete school, and plan to use contraception to space their children. Thanks to the mainstreaming of gender issues in the national education plan, the school runs tutorial classes for girls and assigns a teacher to monitor girls who drop out.

DFID’s whole contribution to Ethiopian education was £61 million in 2011-12. The opening and closing ceremonies of the Olympics and Paralympics cost around £81 million. Indeed, the entire aid budget in 2011 (£8.6 billion) was significantly less than the government spent on hosting the Olympics (£9.3 billion).

Others have questioned Pascoe’s arguments about the irrelevance of soft power in general or the projection of British influence in particular. I’m not sure that’s the point. Textbook by textbook and classroom by classroom, UK aid marked “from the British people” is being delivered by representatives the British people can be proud of, and it is changing lives. I hope that knowledge guides Justine Greening’s line-by-line review.



[1] As a side note, one wonders if margins are high across the board, or only for organisations prepared to bid for work in Afganistan.

UK Aid, accountability and optimal logo placement

DFID has just produced a new version of its UK Aid logo. While there is general grumbling about the jingoistic addition of the Union Jack and its similarity to the USAID logo – the current iteration is not vastly different than the original – introduced three years ago (one of the first things I blogged about) by the previous government.

These sort of emblems have always made me uneasy. When I worked as a civil servant in Malawi, my printer was branded with a “from the American people” sticker (as was my USB stick). The presence of the sticker made me feel like I should be worshipping some unseen god who delivered me office supplies which only ran on 120 volts.

Douglas Alexander, DFID’s last minister under the Labour government, once said that he wished every DFID-funded classroom would have some notice telling children and their parents that the UK was responsible, and that this would help accountability. The rest of us ridiculed that idea, dismissing it as a Trojan horse for self-promotion.

However, perhaps Mr. Alexander was correct in his assumption that emblazoning everything with “UK Aid” could – in theory – increase accountability. If DFID funded something which utterly failed, then it would be incredibly obvious to everyone around. Just one photo of a derelict Union Jack-stamped school would make for pretty poor press. This might create incentives to make aid more effective.

Yet, if the folks at DFID realize this and are rational – instead of trying to be more effective, it’s much easier just to be more careful with sticker placement. Put stickers on high-profile, “successful” ventures (think bags of food rather than say, good governance) and avoid putting stickers on anything that looks like it might fail. So DFID won’t need to be more effective, just more discerning with their stickers.