Political Economy of Foreign Aid

The vast majority of countries around the world participate in the foreign aid process, as donors, recipients, or, sometimes, both. States use foreign aid to promote international development abroad. They also use it to pursue foreign policy objectives. In the first part of the course, we will explore the factors that shape foreign aid decisions in donor countries, including ideas, interests, institutions and donor publics. In the second half of the course we focus on what happens to foreign aid in the recipient country. We examine how institutions influence the effective implementation on foreign aid and identify multiple sources for aid capture in recipient governments or implementing agencies. We explore how the presence of donors shapes ordinary citizens views about their own domestic government, thinking about foreign aid’s effects on development in the long run. A broader goal of the course is to practice a scientific approach to the study of politics. We will be particularly interested in how scholars propose hypotheses about the political economy of foreign aid and how they use empirical evidence to test these propositions.