Is Aid Working? Is this the Right Question?

Roger C. Riddell, pimping his new book about foreign aid,  has written an interesting piece for Open Democracy about how aid should be assessed and where the main battlegrounds for improving it lie. Some highlights:

Aid’s supporters cite cases of aid to press the general case that “aid works”, aid’s critics cite particular examples of aid’s failures to try to make the general case that “aid doesn’t work”.  The result is that public discussions of aid are characterised by a lack of effective debate and engagement, conducted more like ships passing in the night

Unfortunately, I really think he’s right in this assessment. The Easterly-Sachs-Moyo contretemps a while back demonstrated this. It took the appearance of idealoguery rather than debate at times. Without wishing to cast aspersions, in general I do think some of the aid cheerleaders have a habit of shouting down dissent.

Riddell also worries that we are quickly getting to a point where

… the case for development aid, and the moral basis that underpins it, [is] driven exclusively by performance-based management, the results culture and “value for money” starting-points that have come to dominate contemporary discourse on public expenditure …  Why should the case for or against development aid be driven so centrally by evidence of past or present successes, or failures?  What room is there for providing aid to learn and to innovate?

… those countries which need aid the most are precisely the countries where aid is least likely to work well … many of the causes and manifestations of their poverty are in their turn likely to lower the effectiveness of the aid provided – lack of skills, weak institutions, underdeveloped and distorted markets, an inadequate regulatory framework, poor public accountabilities and a lack of transparency of government expenditures due to fragile democratic systems and weak civil societies.

Again, I have sympathy for part of this, but not all. Yes, the Thatcherite revolution in England has put quantifying success to the fore at the expense of more nuanced discussion. A balance needs to be restored. That said, while aid to learn and innovate is fine, we must never lose sight that past successes in development (not just aid) is all we have to go on with any real evidence. It’s within our knowledge of how development has happened that we should be innovative; new ways of using aid to push for development is good, as long as its based on a solid understanding of what development is and how it has and continues to happen.

He’s no aid cheerleader, however:

… the evidence indicates that development occurs without aid, and that the process of development is influenced predominantly by what happens within recipient countries, shaped by the commitment and capability of aid-recipient country governments and by dynamic changes to the respective power and voice of different interest groups within the national political economy.

… the evidence suggests that choices made by donors of who to support and for how long … have often been inappropriate, or wrong.  This has often been because they have been based on an inadequate or superficial understanding of the complexities of the political economy of aid-recipient countries, and, at times, because they have been based on trying to import and impose alien and inappropriate state, governance and institutional models … The notion that donors have sufficient understanding of the complexities of aid-recipient countries to engineer a desirable social, political and cultural transformation often in a complex ethnic setting, and that they have the “right” to engage in such engineering needs far more debate.

Finally, he concludes that the aid question is not whether or not it ‘works’, but how we can close the gap between what aid should be capable of and where it is now. He presents a number of issues that need to be debated more: incentives, predictability and so on. No answers, at least not in the article, but some interesting questions.

As someone who works in aid effectiveness professionally, there’s nothing earth shaking in here for me and indeed I think it misses out some crucial questions, but this is a really good introduction to the problems in foreign aid. It goes beyond the number throwing and global picture analysis and actually specifies some of the systematic issues that the practical and political realities of giving and using aid throws up. Definitely worth a read. The full article is here.

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