The Market for Aid : Understanding Aid by Looking Forward and Looking Back

Abstract

The market for aid is changing. These days donors use a far greater array of instruments than in the past, and operate in a context of far larger private financial flows. Poor countries are growing richer, but there are legitimate doubts about whether the aid industry deserves credit. Measurement of the effectiveness of aid has not yet produced some of the results that would really help, such as credible ratings of aid agencies or rigorous randomized trials of specific programs. This information might pull the aid debate away from minimizing the costs of aid competition and toward trying to maximize the benefits: widespread experimentation and innovation.

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