Aid Distribution and Cooperation in Unequal Communities

19 Pages Posted: 6 Feb 2014

See all articles by Ben D'Exelle

Ben D'Exelle

University of East Anglia (UEA)

Marrit Van den Berg

Wageningen University - Development Economics

Date Written: March 2014

Abstract

We experimentally study aid distribution and cooperation in a field lab in rural Nicaragua. In the first stage of the experimental game, participants contribute to a collective effort that determines the amount of aid given to the group, which is distributed among the players in a second stage. We find that in a treatment where a group representative, selected as the highest contributor, distributes aid, contributions are higher compared to a treatment where aid is equally distributed. The higher amounts of aid attracted, however, benefit representatives only. At the same time, representatives do care about fairness. They give higher aid shares to players with low endowments and lower shares to low contributors. Moreover, representatives with lower relative wealth or who contribute relatively more, keep higher aid shares. With our experimental game simulating community‐based development (CBD) schemes, we discuss the implications of our results for elite capture in such schemes.

Keywords: aid distribution, collective action, experiment, Nicaragua

JEL Classification: C93, D31, D70

Suggested Citation

D’Exelle, Ben and Van den Berg, Marrit, Aid Distribution and Cooperation in Unequal Communities (March 2014). Review of Income and Wealth, Vol. 60, Issue 1, pp. 114-132, 2014. Available at SSRN: https://ssrn.com/abstract=2391545 or http://dx.doi.org/10.1111/roiw.12092

Ben D’Exelle (Contact Author)

University of East Anglia (UEA) ( email )

Norwich Research Park
Norwich, NR4 7TJ
United Kingdom

Marrit Van den Berg

Wageningen University - Development Economics

Hollandseweg 1
6706KN
Netherlands

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