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Multilateral Aid Agencies and Strategic Donor Behaviour

George Mavrotas and Espen Villanger ()

No DP2006-02, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: The paper builds on recent empirical evidence on the importance of strategic donor behaviour in aid allocation in order to develop a theoretical model where donor pressure on a recipient for influencing the aid disbursement of a multilateral institution is endogenously determined. Our game-theoretic, multi-agent model with one aid recipient, two bilateral donors and one multilateral institution illustrates the advantage of putting pressure on the recipient as an instrument for foreign policy, as seen from the mighty donor's point of view.

Keywords: Economic assistance and foreign aid; International agencies; Strategic planning (search for similar items in EconPapers)
Date: 2006
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