Coordination Failure in Foreign Aid
The author analyzes the allocation of foreign aid to various sectors in a recipient developing country. Donors tend to favor social sectors over other public expenditure programs. Due to incomplete information, donors may concentrate too much on pr...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, D.C.
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2004/02/3585322/coordination-failure-foreign-aid http://hdl.handle.net/10986/14305 |
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okr-10986-143052021-04-23T14:03:20Z Coordination Failure in Foreign Aid Halonen-Akatwijuka, Maija FOREIGN AID DEVELOPMENT ASSISTANCE DEVELOPMENT AID SOCIAL SECTOR PUBLIC EXPENDITURES DONORS ECONOMIC SECTORS BUDGET MANAGEMENT FUNGIBILITY DISEASES DONATIONS DONOR COUNTRY ECONOMIC GROWTH ECONOMICS ENVIRONMENTAL SUSTAINABILITY EQUILIBRIUM EXTERNALITIES EXTREME POVERTY FOREIGN AID GENDER HEALTH SECTOR HUNGER INCOME INFORMATION PROBLEMS MALARIA MORTALITY PARTNERSHIP PRIVATE INFORMATION PUBLIC GOODS TRANSACTION COSTS UTILITY FUNCTIONS NGO NON-GOVERNMENTAL ORGANIZATION The author analyzes the allocation of foreign aid to various sectors in a recipient developing country. Donors tend to favor social sectors over other public expenditure programs. Due to incomplete information, donors may concentrate too much on priority sectors, leaving lower-priority yet important sectors lacking funds. Alternatively there may be gaps in services in priority areas because of the information problem. The author finds that the more similar preferences the donors have, the more scope there is for coordination failure. Therefore improving information is particularly important when the parties have similar priorities. A joint database on planned projects and budget allocations in each recipient country would provide such information. The author's point is that such databases should have both information on current projects and forward-looking information on the planned activities needed to improve aid coordination. She also analyzes the aid fungibility problem in an incomplete information setting and finds that incomplete information reduces the fungibility problem. On the other hand, incomplete information introduces coordination failure and the allocation can be inferior for both the recipient and the donor. 2013-07-01T16:54:12Z 2013-07-01T16:54:12Z 2004-02 http://documents.worldbank.org/curated/en/2004/02/3585322/coordination-failure-foreign-aid http://hdl.handle.net/10986/14305 English en_US Policy Research Working Paper;No.3223 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, D.C. Publications & Research :: Policy Research Working Paper Publications & Research |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
FOREIGN AID DEVELOPMENT ASSISTANCE DEVELOPMENT AID SOCIAL SECTOR PUBLIC EXPENDITURES DONORS ECONOMIC SECTORS BUDGET MANAGEMENT FUNGIBILITY DISEASES DONATIONS DONOR COUNTRY ECONOMIC GROWTH ECONOMICS ENVIRONMENTAL SUSTAINABILITY EQUILIBRIUM EXTERNALITIES EXTREME POVERTY FOREIGN AID GENDER HEALTH SECTOR HUNGER INCOME INFORMATION PROBLEMS MALARIA MORTALITY PARTNERSHIP PRIVATE INFORMATION PUBLIC GOODS TRANSACTION COSTS UTILITY FUNCTIONS NGO NON-GOVERNMENTAL ORGANIZATION |
| spellingShingle |
FOREIGN AID DEVELOPMENT ASSISTANCE DEVELOPMENT AID SOCIAL SECTOR PUBLIC EXPENDITURES DONORS ECONOMIC SECTORS BUDGET MANAGEMENT FUNGIBILITY DISEASES DONATIONS DONOR COUNTRY ECONOMIC GROWTH ECONOMICS ENVIRONMENTAL SUSTAINABILITY EQUILIBRIUM EXTERNALITIES EXTREME POVERTY FOREIGN AID GENDER HEALTH SECTOR HUNGER INCOME INFORMATION PROBLEMS MALARIA MORTALITY PARTNERSHIP PRIVATE INFORMATION PUBLIC GOODS TRANSACTION COSTS UTILITY FUNCTIONS NGO NON-GOVERNMENTAL ORGANIZATION Halonen-Akatwijuka, Maija Coordination Failure in Foreign Aid |
| relation |
Policy Research Working Paper;No.3223 |
| description |
The author analyzes the allocation of
foreign aid to various sectors in a recipient developing
country. Donors tend to favor social sectors over other
public expenditure programs. Due to incomplete information,
donors may concentrate too much on priority sectors, leaving
lower-priority yet important sectors lacking funds.
Alternatively there may be gaps in services in priority
areas because of the information problem. The author finds
that the more similar preferences the donors have, the more
scope there is for coordination failure. Therefore improving
information is particularly important when the parties have
similar priorities. A joint database on planned projects and
budget allocations in each recipient country would provide
such information. The author's point is that such
databases should have both information on current projects
and forward-looking information on the planned activities
needed to improve aid coordination. She also analyzes the
aid fungibility problem in an incomplete information setting
and finds that incomplete information reduces the
fungibility problem. On the other hand, incomplete
information introduces coordination failure and the
allocation can be inferior for both the recipient and the donor. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Halonen-Akatwijuka, Maija |
| author_facet |
Halonen-Akatwijuka, Maija |
| author_sort |
Halonen-Akatwijuka, Maija |
| title |
Coordination Failure in Foreign Aid |
| title_short |
Coordination Failure in Foreign Aid |
| title_full |
Coordination Failure in Foreign Aid |
| title_fullStr |
Coordination Failure in Foreign Aid |
| title_full_unstemmed |
Coordination Failure in Foreign Aid |
| title_sort |
coordination failure in foreign aid |
| publisher |
World Bank, Washington, D.C. |
| publishDate |
2013 |
| url |
http://documents.worldbank.org/curated/en/2004/02/3585322/coordination-failure-foreign-aid http://hdl.handle.net/10986/14305 |
| _version_ |
1764430264122998784 |