It Takes Two to Tango

2017 ◽  
Author(s):  
Haley J. Swedlund
Keyword(s):  
Foreign Aid ◽  
Institutional Economics ◽  
Theoretical Framework ◽  
Delivery Mechanism ◽  
Donor Agencies ◽  
Commitment Problems ◽  
Aid Policy ◽  
Over Time

Chapter 2 outlines the theoretical arguments of the book. The chapter first provides a theoretical framework for understanding aid policy bargaining between donor agencies and recipient governments. Then, drawing on theories of institutional economics, the chapter articulates how commitment problems in foreign aid are theorized to influence choices in aid delivery and the sustainability of aid delivery mechanisms over time. The chapter argues that the sustainability of a aid delivery mechanism depends on its ability to incentivize both donors and recipients to uphold their commitments over the long term.

The Development Dance

2017 ◽  
Author(s):  
Haley J. Swedlund
Keyword(s):  
Foreign Aid ◽  
Aid Effectiveness ◽  
Theoretical Argument ◽  
Credible Commitments ◽  
The Core ◽  
History Of ◽  
Delivery Mechanism ◽  
Donor Agencies

Chapter 1 summarizes the core arguments of the book and introduces the significance of the project both theoretically and practically. The chapter argues that scholars and practitioners too often focus on aid effectiveness, ignoring how choices regarding aid delivery mechanism are made to being with. The chapter then provides a brief historical look at foreign aid, demonstrating that the history of foreign aid is a history of fads and fashions. Finally, the chapter summarizes the core theoretical argument of the book, which is that commitment problems constrain the policy compromises reached by donors and recipients. If we want to know whether an aid delivery mechanism is likely to be sustained over the long term, we need to look at whether it induces credible commitments from both donor agencies and recipient governments.

The Conceptual Framework: Growth, Institutions, and Social Orders

2018 ◽  
Author(s):  
Andrea Lorenzo Capussela
Keyword(s):  
Open Access ◽  
Conceptual Framework ◽  
Social Order ◽  
Institutional Economics ◽  
Theoretical Framework ◽  
Institutional Reforms ◽  
Reversible Process ◽  
Main Determinant ◽  
Social Orders

This chapter lays out one part of the theoretical framework of the book, drawn from institutional economics. This literature maintains that institutions are the main determinant of long-term growth, and that to remain ‘appropriate’ institutions must evolve in synchrony with an economy’s progress through the stages of its development. Their evolution depends on a society’s openness to political creative destruction. Limited-access social orders tend to constrain it, to safeguard elites’ rents, and typically undermine progressive institutional reforms, breaking that synchrony. The transition from that social order to the open-access one is an endogenous and reversible process, in which inefficient institutions, which allow elites to extract rents, coexist with appropriate ones, which constrain their power and make it contestable. The hypothesis is advanced that Italy has not yet completed this transition, and that the tension between its efficient and inefficient institutions can endogenously generate shocks, which open opportunities for equilibrium shifts.

Tracking a Craze

2017 ◽  
Author(s):  
Haley J. Swedlund
Keyword(s):  
Initial Period ◽  
The Other ◽  
Budget Support ◽  
Delivery Mechanism ◽  
Donor Agencies ◽  
Commitment Problems

Chapter 6 charts the rise and fall of budget support as a popular aid delivery mechanism. Because budget support promised to reduce donor commitment problems, it opened up the possibility for a new, more favourable bargaining compromise between donor agencies and recipient countries. However, ultimately neither donor agencies nor recipient governments were able to enforce the promises made by the other side. Consequently, the negotiated compromise that enabled the emergence of budget support was not sustainable past an initial period of enthusiasm.

The Fleeting Effects of Disclosure Forthcomingness on Management's Reporting Credibility

2005 ◽  
Vol 80 (2) ◽  
pp. 723-744 ◽  
Author(s):  
Molly Mercer
Keyword(s):  
Experimental Evidence ◽  
Theoretical Framework ◽  
Short Term ◽  
Disclosure Decisions ◽  
Negative News ◽  
Positive Effect ◽  
Over Time ◽  
Negative Earnings

This study provides a theoretical framework and experimental evidence on how managers' disclosure decisions affect their credibility with investors. I find that in the short-term, more forthcoming disclosure has a positive effect on management's reporting credibility, especially when management is forthcoming about negative news. However, these short-term credibility effects do not persist over time. In the long-term, managers who report positive earnings news are rated as having higher reporting credibility than managers who report negative earnings news, regardless of their previous disclosure decisions.

scholarly journals Are democratising countries rewarded with higher levels of foreign aid?

2015 ◽  
Vol 65 (4) ◽  
pp. 593-615
Author(s):  
Balázs Szent-Iványi
Keyword(s):  
Developing Countries ◽  
Foreign Aid ◽  
Sub Saharan Africa ◽  
Partner Country ◽  
Democratic Transitions ◽  
Aid Allocation ◽  
Sub Saharan ◽  
Over Time

The paper examines how flows of foreign aid have reacted to events of democratisation in developing countries. Using a panel dataset of 136 aid-receiving countries between 1980 and 2009, aid allocation regressions reveal that Western donors in general have tended to react to visible, major democratic transitions by increasing aid to the partner country, but no significant increases can be identified in the case of countries introducing smaller democratic reforms. The increases in aid flows are not sustained over time, implying that donors do not provide long-term support to nascent democracies. Also, democratisations in Sub-Saharan Africa do not seem to have been rewarded with higher levels of aid.

Compete or Coordinate? Aid Fragmentation and Lead Donorship

2015 ◽  
Vol 69 (2) ◽  
pp. 443-472 ◽  
Author(s):  
Martin C. Steinwand
Keyword(s):  
Foreign Aid ◽  
Recipient Country ◽  
Nonparametric Model ◽  
Private Goods ◽  
Collective Action Problems ◽  
Private And Public ◽  
Spatial Autoregressive ◽  
Donor Coordination ◽  
Aid Policy

AbstractDonor proliferation and the fragmentation of aid delivery is an important problem besetting foreign aid policy. Increased donor coordination is widely seen as a fix to this problem. This article explores theoretically and empirically the collective action problems and incentives that donors face when coordinating their actions, based on the distinction between private and public goods properties of aid. I introduce the concept of lead donorship, develop a measure that accounts for the exclusive and long-lasting ties between a lead donor and a recipient country, and show that lead donorship is in long-term decline. I test my theory combining spatial autoregressive (SAR) models, nonparametric model discrimination techniques, and data on aid delivery channels. I recover evidence of collusion in the provision of private goods aid in the presence of a lead donor, and lack of coordination and competition in the absence of a lead donor.

Implementing Long-Term Climate Policy: Time Inconsistency, Domestic Politics, International Anarchy

2009 ◽  
Vol 9 (3) ◽  
pp. 20-39 ◽  
Author(s):  
Jon Hovi ◽  
Detlef F. Sprinz ◽  
Arild Underdal
Keyword(s):  
Climate Change ◽  
Climate Policy ◽  
Domestic Politics ◽  
Time Inconsistency ◽  
Considerable Uncertainty ◽  
Policy Problem ◽  
Effective Policy ◽  
Commitment Problems ◽  
Over Time

As a quintessential long-term policy problem, climate change poses two major challenges. The first is to develop, under considerable uncertainty, a plan for allocating resources over time to achieve an effective policy response. The second is to implement this plan, once arrived at, consistently over time. We consider the second of these two challenges, arguing that it consists of three interrelated, commitment problems—the time inconsistency problem, the domestic politics problem, and the anarchy problem. We discuss each of these commitment problems in some detail, explore how they relate to climate policy, and suggest institutional designs that may help limit their adverse impact. While each of these commitment problems is difficult to tackle on its own, climate change requires us to cope with all of them at once. This is likely one major reason why we have so far made only modest headway on this vital issue.

The Development Dance

2017 ◽  
Author(s):  
Haley J. Swedlund
Keyword(s):  
Foreign Aid ◽  
Fundamental Problem ◽  
Development Cooperation ◽  
African Countries ◽  
Credible Commitments ◽  
Government Relations ◽  
Sub Saharan ◽  
Original Survey ◽  
Donor Agencies

The Development Dance is about how donor countries and recipient governments negotiate the delivery of foreign aid. The book provides a conceptual framework for understanding donor-government relations and a theory for explaining the sustainability of aid delivery mechanisms. Drawing on extensive in-country fieldwork in four sub-Saharan African countries, as well as an original survey of development practitioners in twenty countries, the book points to a fundamental problem in the delivery of aid: the policy compromises reached by donor agencies and recipient governments are rarely politically sustainable. Commitment problems constrain the policy compromises reached by donors and recipients. As a result, fads and fashions dominate development cooperation, and the delivery of foreign aid is not determined by effectiveness alone. If we want to know whether an aid delivery mechanism is likely to be sustained over the long term, we need to look at whether it induces credible commitments from both donor agencies and recipient governments.

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