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WP/032 International Coordination and the Effectiveness of Aid

This paper discusses and seeks to quantify the effects of improved donor coordination on aid effectiveness. Empirical estimates are first provided of the reductions in transaction costs that can be achieved by better donor coordination via concentration to fewer partner countries and a shift from project aid to programme-based approaches. Further estimates are presented showing how much could be gained in terms of poverty reduction by optimizing aid allocation across countries. The potential gains of a coordinated reallocation would be huge, but there are severe political implementation constraints. Still, the overall conclusion of the paper is that there are huge potential gains from donor coordination.
Publisher:
UNU-WIDER
Series:
WIDER Working Paper
Volume:
2012/32
Title:
WP/032 International Coordination and the Effectiveness of Aid
Authors:
Arne Bigsten and Sven Tengstam
Publication date:
March 2012
ISBN 13 Web:
978-92-9230-495-9
Copyright holder:
© UNU-WIDER
Copyright year:
2012
Keywords:
donor coordination, Paris Agenda, aid efficiency
JEL:
F35, F55, F59
Sponsor:
This working paper has been prepared within the UNU-WIDER project ‘Foreign Aid: Research and Communication (ReCom)’, directed by Tony Addison and Finn Tarp. UNU-WIDER gratefully acknowledges specific programme contributions from the governments of Denmark (Ministry of Foreign Affairs, Danida) and Sweden (Swedish International Development Cooperation Agency—Sida) for the Research and Communication (ReCom) programme. UNU-WIDER also acknowledges core financial support to UNU-WIDER’s work programme from the governments of Finland (Ministry for Foreign Affairs), the United Kingdom (Department for International Development), and the governments of Denmark and Sweden.
Format:
online
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