Evaluating Aid for Trade: A Survey of Recent Studies

27 Pages Posted: 20 Apr 2016

See all articles by Olivier Cadot

Olivier Cadot

University of Lausanne - School of Economics and Business Administration (HEC-Lausanne); Centre for Economic Policy Research (CEPR); World Bank

Ana Ernandes

affiliation not provided to SSRN

Julien Gourdon

OECD

Aaditya Mattoo

World Bank - Development Research Group (DECRG)

Jaime de Melo

University of Geneva - Department of Political Economics; Centre for Economic Policy Research (CEPR); World Bank

Multiple version iconThere are 3 versions of this paper

Date Written: January 1, 2014

Abstract

The demand for accountability in aid-for-trade is increasing but monitoring has focused on case studies and impressionistic narratives. The paper reviews recent evidence from a wide range of studies, recognizing that a multiplicity of approaches is needed to learn what works and what does not. The review concludes that there is some support for the emphasis on reducing trade costs through investments in hard infrastructure (like ports and roads) and soft infrastructure (like customs). But failure to implement complementary reform -- especially the introduction of competition in transport services -- may erode the benefits of these investments. Direct support to exporters does seem to lead to diversification across products and destinations, but it is not yet clear that these benefits are durable. In general, it is difficult to rely on cross-country studies to direct aid-for-trade. More rigorous impact evaluation is an underutilized alternative, but situations of clinical interventions in trade are rare and adverse incentives (because of agency problems) and costs (because of the small size of project) are a hurdle in implementation.

Keywords: Transport Economics Policy & Planning, Economic Theory & Research, Free Trade, Common Carriers Industry, Transport and Trade Logistics

Suggested Citation

Cadot, Olivier and Ernandes, Ana and Gourdon, Julien and Mattoo, Aaditya and de Melo, Jaime, Evaluating Aid for Trade: A Survey of Recent Studies (January 1, 2014). World Bank Policy Research Working Paper No. 6742. Available at SSRN: https://ssrn.com/abstract=2376577

Olivier Cadot (Contact Author)

University of Lausanne - School of Economics and Business Administration (HEC-Lausanne) ( email )

Unil Dorigny, Batiment Internef
Lausanne, 1015
Switzerland
+41 21 692 3463 (Phone)
+41 21 692 3495 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

World Bank ( email )

1818 H Street NW
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Ana Ernandes

affiliation not provided to SSRN

No Address Available

Julien Gourdon

OECD ( email )

2 rue Andre Pascal
Paris Cedex 16, 75775
France

Aaditya Mattoo

World Bank - Development Research Group (DECRG) ( email )

1818 H Street, N.W.
Room MC 3-327
Washington, DC 20433
United States
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202-676-9810 (Fax)

HOME PAGE: http://econ.worldbank.org/staff/amattoo

Jaime De Melo

University of Geneva - Department of Political Economics ( email )

40, boulevard du Pont-d'Arve
Geneva 4, CH-1211
Switzerland
+41 22 705 8273 (Phone)
+41 22 705 8293 (Fax)

HOME PAGE: http://www.unige.ch/ses/ecopo/demelo/Jaime.html

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

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