How Political Insiders Lose Out When International Aid Underperforms: Evidence from a Participatory Development Experiment in Ghana
80 Pages Posted: 30 Mar 2020 Last revised: 6 Apr 2020
Date Written: March 2020
Participatory development is designed to mitigate problems of political bias in pre-existing local government but also interacts with it in complex ways. Using a five-year randomized controlled study in 97 clusters of villages (194 villages) in Ghana, we analyze the effects of a major participatory development program on participation in, leadership of and investment by preexisting political institutions, and on households’ overall socioeconomic well-being. Applying theoretical insights on political participation and redistributive politics, we consider the possibility of both cross-institutional mobilization and displacement, and heterogeneous effects by partisanship. We find the government and its political supporters acted with high expectations for the participatory approach: treatment led to increased participation in local governance and reallocation of resources. But the results did not meet expectations, resulting in a worsening of socioeconomic wellbeing in treatment versus control villages for government supporters. This demonstrates international aid’s complex distributional consequences.
Keywords: participatory development; political economy; international aid; distributive politics
JEL Classification: H4, H7, O12, O17, O19
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