Shooting the messenger of good news: a critical look at the World Bank's success story of effective aid

Peter Nunnenkamp

No 1103, Kiel Working Papers from Kiel Institute for the World Economy (IfW Kiel)

Abstract: In a report presented at the UN Conference on Financing for Development in March 2002, the World Bank claims that the effectiveness of its financial aid has improved substantially by targeting aid at poor developing countries pursuing sound economic policies. However, the World Bank's success story rests on an extremely weak foundation: First, the institution's contribution to financial rescue packages for some emerging markets, rather than poverty concerns and policy assessments, dominated the distribution of World Bank financing. Second, the picture portrayed in the report takes a bad turn if only two outliers with extremely high per capita aid (Cape Verde and Honduras) are excluded from the sample. Third, according to our regression results, the allocation of World Bank aid did not improve in the course of the 1990s.

Keywords: World Bank; International Development Association; financial aid (search for similar items in EconPapers)
JEL-codes: F35 (search for similar items in EconPapers)
Date: 2002
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwkwp:1103

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