When Do Donors Trust Recipient Country Systems?
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World Bank, Washington, DC
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The 2005 Paris Declaration on Aid
Effectiveness sets targets for increased use by donors of
recipient country systems for managing aid. The target is
premised on a view that country systems are strengthened
when donors trust recipients to manage aid funds, but
undermined when donors manage aid through their own separate
parallel systems. This study provides an analytical
framework for understanding donors' decisions to trust
or bypass country systems. Empirical tests are conducted
using data from three OECD-DAC surveys designed to monitor
progress toward Paris Declaration goals. Tests show that a
donor's use of the recipient country's systems is
positively related to: (1) the donor's share of aid
provided to the recipient (a proxy for the donor's
reputational stake in the country's development); (2)
perceptions of corruption in the recipient country (a proxy
for the trustworthiness or quality of the country's
systems); and (3) public support for aid in the donor
country (a proxy for the donor's risk tolerance).
Findings are robust to corrections for potential sample
selection, omitted variables or endogeneity bias.
Palabras clave
AID, AID AGENCIES, AID FLOWS, AID PROGRAMS, ANECDOTAL EVIDENCE, AUTONOMY, BILATERAL DONOR, COMPANION, DEVELOPMENT AID, DEVELOPMENT ASSISTANCE, DEVELOPMENT BANKS, DEVELOPMENT COOPERATION, DEVELOPMENT ISSUES, DEVELOPMENT OBJECTIVES, DEVELOPMENT POLICY, DEVELOPMENT RESEARCH, DEVELOPMENT STRATEGIES, DISEASES, ECONOMIC DEVELOPMENT, ECONOMIC GROWTH, EXCLUSION, FIRMS, HUMANITARIAN AID, INCLUSION, INTERNATIONAL AID, INTERNATIONAL DEVELOPMENT, MIDDLE-INCOME COUNTRIES, MULTILATERAL DEVELOPMENT BANK, MULTILATERAL DEVELOPMENT BANKS, NATIONAL DEVELOPMENT, NATURAL RESOURCE, PARTNER COUNTRY, PARTNERSHIP, PRIORITIES, PRIVATE COMPANIES, SCHOOLS, SOCIETY, STD, SUPPLIERS, TECHNICAL ASSISTANCE, TOLERANCE, TUBERCULOSIS