Executive summary: The evidence that foreign aid harms political institutions in recipient countries is weak; recent studies find small or no effects.
Key points:
The “aid harms institutions” argument makes theoretical sense but early empirical support was flawed.
Recent studies using panel data tend to find small or no effects of aid on measures of democracy, governance, etc.
The evidence is imperfect but better than anecdotal claims; suggests aid likely does not systematically help or hurt institutions.
Effects are probably small in either direction or studies would pick them up more clearly.
Skepticism is warranted, but should also apply to claims of harm, which lack systematic analysis.
Bottom line: little strong evidence aid harms institutions on average, though context may matter.
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Executive summary: The evidence that foreign aid harms political institutions in recipient countries is weak; recent studies find small or no effects.
Key points:
The “aid harms institutions” argument makes theoretical sense but early empirical support was flawed.
Recent studies using panel data tend to find small or no effects of aid on measures of democracy, governance, etc.
The evidence is imperfect but better than anecdotal claims; suggests aid likely does not systematically help or hurt institutions.
Effects are probably small in either direction or studies would pick them up more clearly.
Skepticism is warranted, but should also apply to claims of harm, which lack systematic analysis.
Bottom line: little strong evidence aid harms institutions on average, though context may matter.
This comment was auto-generated by the EA Forum Team. Feel free to point out issues with this summary by replying to the comment, and contact us if you have feedback.