Grants or Loans? Development Finance and Incentive Effects

Some people think the best way to give aid is through grants. Others advocate aid embedded in subsidized loans. Mostly, incentive effects on donors and recipients are ignored in this debate. But grants and loans carry different incentives and in so...

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Main Authors:	Harford, Tim, Klein, Michael
Format:	Publications & Research
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ACCOUNTABILITY BILATERAL LOANS BORROWER CAPITAL CAPITAL MARKETS CONCESSIONAL LOAN CONCESSIONAL LOANS DEBT DEVELOPMENT BANKS DEVELOPMENT FINANCE DISBURSEMENTS DONOR COUNTRIES ECONOMIC GROWTH FINANCING OPTIONS FOREIGN AID INVESTMENT SPENDING LENDERS LOAN LOANS MORAL HAZARD PRIVATE SECTOR PUBLIC POLICY RELENDING TAX TAX REVENUE GRANTS
Online Access:	http://documents.worldbank.org/curated/en/2005/03/6040022/grants-or-loans-development-finance-incentive-effects http://hdl.handle.net/10986/11230

id	okr-10986-11230
recordtype	oai_dc
spelling	okr-10986-112302021-04-23T14:02:54Z Grants or Loans? Development Finance and Incentive Effects Harford, Tim Klein, Michael ACCOUNTABILITY BILATERAL LOANS BORROWER CAPITAL CAPITAL MARKETS CONCESSIONAL LOAN CONCESSIONAL LOANS DEBT DEVELOPMENT BANKS DEVELOPMENT FINANCE DISBURSEMENTS DONOR COUNTRIES ECONOMIC GROWTH FINANCING OPTIONS FOREIGN AID INVESTMENT SPENDING LENDERS LOAN LOANS MORAL HAZARD PRIVATE SECTOR PUBLIC POLICY RELENDING TAX TAX REVENUE GRANTS Some people think the best way to give aid is through grants. Others advocate aid embedded in subsidized loans. Mostly, incentive effects on donors and recipients are ignored in this debate. But grants and loans carry different incentives and in some settings can be complementary. Donors should offer a wider menu of options, including ongoing forgiveness of loans, unbundled subsidies, and loans combined with output-based grants. Donor agency staff should be rewarded for outcomes, not volume of funds out the door. 2012-08-13T14:30:29Z 2012-08-13T14:30:29Z 2005-03 http://documents.worldbank.org/curated/en/2005/03/6040022/grants-or-loans-development-finance-incentive-effects Viewpoint,--Note no. 287 (March 2005) http://hdl.handle.net/10986/11230 English Viewpoint CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Viewpoint
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ACCOUNTABILITY BILATERAL LOANS BORROWER CAPITAL CAPITAL MARKETS CONCESSIONAL LOAN CONCESSIONAL LOANS DEBT DEVELOPMENT BANKS DEVELOPMENT FINANCE DISBURSEMENTS DONOR COUNTRIES ECONOMIC GROWTH FINANCING OPTIONS FOREIGN AID INVESTMENT SPENDING LENDERS LOAN LOANS MORAL HAZARD PRIVATE SECTOR PUBLIC POLICY RELENDING TAX TAX REVENUE GRANTS
spellingShingle	ACCOUNTABILITY BILATERAL LOANS BORROWER CAPITAL CAPITAL MARKETS CONCESSIONAL LOAN CONCESSIONAL LOANS DEBT DEVELOPMENT BANKS DEVELOPMENT FINANCE DISBURSEMENTS DONOR COUNTRIES ECONOMIC GROWTH FINANCING OPTIONS FOREIGN AID INVESTMENT SPENDING LENDERS LOAN LOANS MORAL HAZARD PRIVATE SECTOR PUBLIC POLICY RELENDING TAX TAX REVENUE GRANTS Harford, Tim Klein, Michael Grants or Loans? Development Finance and Incentive Effects
relation	Viewpoint
description	Some people think the best way to give aid is through grants. Others advocate aid embedded in subsidized loans. Mostly, incentive effects on donors and recipients are ignored in this debate. But grants and loans carry different incentives and in some settings can be complementary. Donors should offer a wider menu of options, including ongoing forgiveness of loans, unbundled subsidies, and loans combined with output-based grants. Donor agency staff should be rewarded for outcomes, not volume of funds out the door.
format	Publications & Research
author	Harford, Tim Klein, Michael
author_facet	Harford, Tim Klein, Michael
author_sort	Harford, Tim
title	Grants or Loans? Development Finance and Incentive Effects
title_short	Grants or Loans? Development Finance and Incentive Effects
title_full	Grants or Loans? Development Finance and Incentive Effects
title_fullStr	Grants or Loans? Development Finance and Incentive Effects
title_full_unstemmed	Grants or Loans? Development Finance and Incentive Effects
title_sort	grants or loans? development finance and incentive effects
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2005/03/6040022/grants-or-loans-development-finance-incentive-effects http://hdl.handle.net/10986/11230
_version_	1764415990639099904

Grants or Loans? Development Finance and Incentive Effects

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