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Author Annen, Kurt
Title Donor Competition for Aid Impact, and Aid Fragmentation
Imprint Washington DC : International Monetary Fund, 2012
book jacket
Descript 1 online resource (38 pages)
text txt rdacontent
computer c rdamedia
online resource cr rdacarrier
Series IMF Working Papers
IMF Working Papers
Note Cover -- Contents -- 1 Introduction -- 2 Donor Coordination in Practice: Fragmentation -- 3 Background Literature -- 4 Model -- 4.1 Donors Maximize Net Aid Impact -- 4.2 Donors Maximize Relative Net Aid Impact -- 4.3 Introducing Fixed Costs -- 4.4 Introducing More Recipients and More Donors -- 5 Empirical Evidence -- 6 Conclusion -- References -- Figures -- 1 Number of Recipient Countries and Global Aid Budget Shares -- 2 Global Aid Herfindahl Index -- 3 Best-Response Functions with Identical Donors -- 4 Best-Response Functions with Non-Identical Donors -- 5 Herfindahl Index and Relative Donor Size -- Tables -- 1 Larger Donors vs. Smaller Donors -- 2 Donor Ranking in Aid Selectivity -- 3 Donor Selectivity and Herfindahl Index -- Appendix A -- Proof of Proposition 1 -- Description of Best-Response Functions -- Proof of Proposition 4 -- Appendix B -- Table 4: Donor Selectivity and MLD -- Table 5: Donor Selectivity and Theil Index
This paper shows that donors that maximize relative aid impact spread their budgets across many recipient countries in a unique Nash equilibrium, explaining aid fragmentation. This equilibrium may be inefficient even without fixed costs, and the inefficiency increases in the equality of donors' budgets. The paper presents empirical evidence consistent with theoretical results. These imply that, short of ending donors' maximization of relative aid impact, agreements to better coordinate aid allocations are not implementable. Moreover, since policies to increase donor competition in terms of aid effectiveness risk reinforcing relativeness, they may well backfire, as any such reinforcement increases aid fragmentation
Description based on publisher supplied metadata and other sources
Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, 2020. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries
Link Print version: Annen, Kurt Donor Competition for Aid Impact, and Aid Fragmentation Washington DC : International Monetary Fund,c2012 9781475505542
Subject Economic assistance.;Flow of funds
Electronic books
Alt Author Moers, Luc
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