2004年-世界发展银行全球_Increasing_Selectivity_of_Foreign____________Aid_1984-2002_33页_375kb

Summary of "The Increasing Selectivity of Foreign Aid, 1984-2002"

Core Content

This paper by David Dollar and Victoria Levin examines the selectivity of foreign aid over the period 1984–2002, focusing on how aid is distributed based on institutional quality and poverty levels. The study introduces two selectivity indexes: the policy selectivity index and the poverty selectivity index, which measure how much aid is directed to countries with strong institutions and policies, and how much is directed to poor countries, respectively.

The paper highlights that selectivity has increased over time, particularly in the 1990s, and that this trend is consistent across different institutional indicators. The findings suggest that aid is more effective in countries with good governance and institutions, and that donors who are more selective in terms of policy and poverty also tend to be more effective in reducing poverty and promoting growth.

Main Findings

• Policy and Poverty Selectivity are Linked: Donors that are highly selective in terms of policy are also highly selective in terms of poverty.
• IDA and ESAF Lead in Selectivity: The World Bank's International Development Association (IDA) and the IMF's Enhanced Structural Adjustment Facility (ESAF) are among the most selective donors.
• Nordic Countries and UK are Selective: Denmark, the Netherlands, Norway, the United Kingdom, and Ireland are also top performers in both policy and poverty selectivity.
• Larger Donors Are Less Selective: Despite their size, France, the United States, and Japan are not particularly selective, indicating that their aid is often directed to countries that are not among the poorest or best-governed.
• IDA is Most Selective in Both Dimensions: IDA consistently ranks highest in both policy and poverty selectivity, suggesting that it is well-aligned with the goals of effective aid allocation.
• Selectivity Improved Over Time: In the 1984–89 period, aid was allocated without regard to institutional quality, but by the 1990s, there was a clear link between aid and institutional environment.

Key Points on Selectivity Indexes

• The policy selectivity index measures how aid is targeted to countries with sound institutions and policies, controlling for per capita income and population.
• The poverty selectivity index evaluates how well aid is directed to poor countries, controlling for institutional quality and population.
• The paper uses CPIA (Country Policy and Institutional Assessment) as the primary measure of institutions and policies, but also tests the robustness of findings using independent indicators such as:
  • ICRG rule of law index
  • Freedom House democracy index

These independent indicators yield similar rankings, reinforcing the conclusion that selectivity is a robust phenomenon.

Evidence of Aid Effectiveness

• Burnside and Dollar (2000) found that aid does not directly correlate with growth, but does correlate with the interaction of aid and institutional quality.
• This suggests that aid effectiveness depends on the recipient country's institutions and policies.
• Project-level studies support the idea that aid is more effective in countries with strong governance and institutional frameworks.

Historical Trends

• In the 1984–89 period, aid was not policy selective, and IDA had no significant relationship with institutional quality.
• By the 1990s, aid allocation had become more selective, with IDA and bilateral donors showing a stronger link to good institutions.
• This indicates that donors have increasingly aligned their aid strategies with institutional quality.

Donor Performance

• IDA consistently ranks highest in both policy and poverty selectivity.
• Nordic countries (Denmark, Netherlands, Norway, Ireland, Sweden) and the UK are also among the most selective.
• Large donors such as the United States, France, and Japan are less selective, often providing aid to non-poor and non-governed countries.
• The European Commission improved its position in the policy selectivity index in 2002, moving from #12 to #12 in the overall ranking, but still ranked low on poverty selectivity.

Conclusion

• The study concludes that aid has become more selective over time, especially in terms of policy and poverty targeting.
• While some donors are more selective than others, the majority of aid agencies have adopted a model that prioritizes aid to poor and well-governed countries.
• However, most aid still comes from large, less selective donors, which limits the overall effectiveness of aid. There is thus a need for more selective aid strategies from these major donors.

Table Highlights

• Table 1: Shows policy selectivity rankings, with IDA, Denmark, and ESAF leading.
• Table 2: Shows poverty selectivity rankings, again with IDA leading.
• Table 3: Combines policy and poverty selectivity into an overall aid selectivity index, with IDA at the top.
• Table 4–6: Present selectivity indexes based on IDA-eligible recipients, with similar patterns observed.
• Table 7–8: Show per capita aid contributions, with Nordic countries and the UK leading in aid per citizen to IDA-eligible countries.

Final Remarks

• The paper emphasizes that aid selectivity is an important factor in the effectiveness of foreign assistance.
• It also points out that more selective aid can have a greater impact on growth and poverty reduction.
• However, the majority of aid still comes from large, non-selective donors, which suggests that there is still room for improvement in the overall aid system.