Show me what you’ve got: a survey experiment of aid allocation dynamics under transparency and austerity mandates

Abstract

This article investigates the effects of transparency and austerity mandates on project legitimacy perceptions and aid allocation decisions. While observational research on aid allocation has focused on state-level factors influencing funding – such as self-interest, humanitarian needs, and recipients’ merits – donor governance has received comparatively little attention. This is paradoxical considering the emphasis on how donors are governed in aid effectiveness reforms, where information disclosure and improved insights about spending is being advocated as means to enhance donor governance. The implications of such disclosure-driven approaches for policy prioritization and aid flows remain poorly understood. While existing research suggests that transparency fosters risk-averse, financially prudent governance, the micro-level effects of disclosure mandates on decision-making processes and perceptions of legitimate aid warrant further scrutiny. This article addresses this gap using a 3 × 6 factorial survey experiment conducted with Finnish public administrators in the central administration (N = 932). The findings reveal minimal overall effects of disclosure and austerity mandates. However, disclosure mandates do alter how public administrators evaluate projects, specifically by reducing the selectivity bias associated with recipient merit considerations. These results underscore the importance of considering the usual explanations for aid allocation in conjunction with the norms and rules that constrain donor organizations.

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