Are NGOs the Better Donors? A Case Study of Aid Allocation for Sweden

KOF Working Paper No. 180

39 Pages Posted: 21 Nov 2007

See all articles by Axel Dreher

Axel Dreher

Heidelberg University

Florian Mölders

German Institute for Economic Research (DIW Berlin)

Peter Nunnenkamp

University of Kiel

Date Written: November 2007

Abstract

This paper analyzes whether and to what extent non-governmental organizations (NGOs) outperform official donors by allocating aid in a way that renders effective poverty alleviation more likely. We employ Probit and Tobit models and make use of an exceptionally detailed database that allows an assessment of the allocation of Swedish NGO aid in comparison to the allocation of Swedish official aid. Our results show that NGOs are more selective when deciding about which countries to enter at all. Moreover, in contrast to NGO aid, there is some evidence that political and commercial motives matter for the selection of ODA recipients. However, the Swedish case also supports the skeptical view according to which NGOs are unlikely to outperform official donors by providing better targeted aid when it comes to the allocation across recipients having passed the eligibility test.

Keywords: Aid allocation, NGO aid, ODA, Sector-specific aid

JEL Classification: F35, O11, O19

Suggested Citation

Dreher, Axel and Mölders, Florian and Nunnenkamp, Peter, Are NGOs the Better Donors? A Case Study of Aid Allocation for Sweden (November 2007). Available at SSRN: https://ssrn.com/abstract=1031672 or http://dx.doi.org/10.2139/ssrn.1031672

Axel Dreher (Contact Author)

Heidelberg University ( email )

Grabengasse 1
Heidelberg, 69117
Germany

HOME PAGE: http://www.axel-dreher.de

Florian Mölders

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstraße 58
Berlin, 10117
Germany

Peter Nunnenkamp

University of Kiel ( email )

D-24100 Kiel
Germany

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