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Giving and Receiving Aid: Does Conflict Count?: 

Giving and Receiving Aid: Does Conflict Count? Eliana Balla Gina Yannitell Reinhardt

How do donor interests condition bilateral aid allocation?: 

How do donor interests condition bilateral aid allocation? Altruistic interests Aid is a development tool; poor countries need money Literacy rates, infant mortality rates, GDP per capita Strategic interests Aid is a policy tool; we use it to establish partnerships and encourage cooperation Proximity to Communist countries, human rights abuses, UNGA votes, military expenditures, democracy indicators, treaty memberships

Slide3: 

Different donors exhibit different patterns Scandinavian donors are altruistic France gives to former colonies Japan gives to trading partners US gives according to geopolitical interests Problem? All donors are not put to the same test Solution? Examine geographic proximity to conflict Why? Aid effectiveness, conflict repercussions

Conflict and allocation: 

Conflict and allocation

Conflict and allocation: 

Conflict and allocation

Conflict and allocation: 

Conflict and allocation

Data, Hypotheses, and Estimation: 

Data, Hypotheses, and Estimation Unit of Analysis: dyad-year (20 donors, 122 recipients, 37 years) Conflict Proximity (0-3); Correlates of War & PRIO Based on whether a recipient contains, borders, or shares a region with conflict Intensity (0-3); PRIO Armed Conflict Data Based on number of battle-related deaths per year

Heckman selection model (MLE): 

Gate-keeping (Selection stage: who gets aid?) GDP per capita, life expectancy Bilateral trade patterns, past colonial ties, Polity IV, UNGA voting history, FDI flows Conflict proximity and intensity Level-setting (Outcome stage: how much aid do they get?) GDP per capita, life expectancy, population Recent UNGA correlations Conflict proximity and intensity Heckman selection model (MLE)

Effects of Conflict Proximity on Aid: 

Effects of Conflict Proximity on Aid Internal and border proximity to conflict increases the possibility of selection Austria, Belgium, Finland, France, Germany, Ireland, Italy, Japan, Netherlands, New Zealand, Norway, Sweden, Switzerland, US Regional proximity to conflict increases the possibility of selection Belgium, Canada, France, Germany, Ireland, Italy, Japan, New Zealand, Sweden, USSR

Effect of Conflict Intensity on Aid: 

Effect of Conflict Intensity on Aid Reduce aid to recipients bordering more intense conflicts Spain, Canada, New Zealand, UK Increase aid to countries bordering more intense conflicts Denmark, Finland, Netherlands, Norway, US, Japan, Germany, Ireland

Changes from low to moderate intensity yield:: 

Changes from low to moderate intensity yield: For internal conflicts: $6.59 increase per capita in US aid (47%) $1.79 increase per capita in Soviet aid (11%) $.76 decrease per capita in French aid (7.5%) For border conflicts: $2.46 increase per capita in US aid (17.4%) $3.12 decrease per capita in UK aid (76%)

Other variables?: 

Other variables? UNGA voting history Positive effects on aid for Austria, Finland, France, Germany, Japan Negative effects on aid for Netherlands, Spain, Ireland Recent UNGA votes $54.50 increase per capita in US aid (400%) $.42 increase per capita in German aid (13%) Denmark and Finland “reward” votes with aid

Humanitarian Indicators: 

Humanitarian Indicators Path dependency is evident for all donors Population Negative and significant for all donors GDP Negative and significant for all donors Life expectancy Significant for all donors

Political and Economic Variables: 

Political and Economic Variables PolityIV Relevant for 9 donors: Denmark, Ireland, Japan, Netherlands, New Zealand, Norway, Portugal, Sweden, Spain Not significant for US, UK, France Bilateral trade Positive effects for: Canada, Denmark, Finland, France, Ireland, New Zealand, Portugal, Sweden, Spain, USSR Colonial ties Positive effects for France, Spain, Portugal

Summary – Gate-Keeping: 

Summary – Gate-Keeping Funnel aid to nations bordering or containing conflict Finland, Norway, and Sweden, plus Austria, Belgium, France, Germany, Ireland, Italy, Netherlands, New Zealand, Switzerland, and the US Funnel aid away from intense conflicts Belgium, Canada, Denmark, France, Ireland, Japan, Switzerland, and Spain

Summary – Level-setting: 

Summary – Level-setting Decrease aid to border and internal conflicts Belgium, Canada, France, New Zealand, Portugal, Switzerland, Spain, and the UK Increase aid to internal or border conflicts US, USSR, Denmark, Finland, Germany, Ireland, Japan, the Netherlands, and Norway Increase aid to border conflicts while decreasing aid to internal conflicts Denmark, Ireland, Japan No level-setting based on conflict Sweden, Austria

Summary - Intensity: 

Summary - Intensity Reduce aid to countries bordering intense conflicts Spain joins Canada, New Zealand, and UK Increase aid to countries bordering intense conflicts Denmark, Finland, the Netherlands, Norway US, Japan, Germany, and Ireland

Conclusions: 

Conclusions Every donor conditions aid on conflict at some point in their allocation. Donor motivations are more complex than previously indicated. Donor types can no longer be assumed as they were previously, and must be broken down more carefully. Geographic proximity and intensity of conflict are important determinants of allocation.