Coding Error or Statistical Embellishment? The Political Economy of Reporting Climate Aid

Abstract

During the last few decades, general awareness has increased that along with problems of international development, environmental problems, notably with respect to climate change, represent yet another global challenge. In an attempt to win further public support for aid expenditures, aid administrations may have tried to make use of this trend in public perception by labeling some of their aid activities as conducive to the mitigation of, or the adaptation to, climate change. In this case, whether a donor reports a project with a climate-related “Rio marker” should depend not only on the actual content of the project, but also on the national voters’ ecological preferences, meteorological extreme events, or the media coverage of international climate policy issues.

In our paper we test these hypotheses using project-level aid data and country-level political data for 21 DAC donors from 1995 to 2007. Keyword search in the project descriptions of the PLAID database and complementary hand-coding allows us to assess all projects for their actual climate change-related content, and to thereby construct our most relevant control variables. We then econometrically analyze the impact of political factors on climate aid reporting, in a multilevel setting, controlling for a number of additional project-level and donor country characteristics. Our results reveal that indeed, coding is influenced systematically by political factors. Further factors are a misinterpretation of the Rio marker, and insufficient coding diligence.

Keywords: Development assistance, climate policy, public choice, project coding, mitigation, adaptation