Aid Fragmentation and Corruption

55 Pages Posted: 18 Jun 2021 Last revised: 9 Nov 2023

See all articles by Travers Child

Travers Child

China Europe International Business School (CEIBS)

Austin L. Wright

University of Chicago - Harris School of Public Policy

Yun Xiao

University of Gothenburg - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: November 6, 2023

Abstract

Aid fragmentation—the simultaneous operation of multiple development agencies in one setting—has long raised concerns about coordination challenges and opportunities for corruption. Leveraging unique data on project delivery i Afghanistan, we present the first microlevel empirical analysis of aid fragmentation. We find that aid delivered by a single donor can significantly reduce corruption. Projects delivered under conditions of aid fragmentation, by contrast, can facilitate corruption. We find evidence for a theoretical mechanism linking infrastructure and physical goods with waste and leakage. Our results clarify the policy losses tied to fragmentation, yielding insights for combating misappropriation of aid.

Keywords: Aid, Corruption, Public opinion, Conflict, Afghanistan

JEL Classification: F35, D73, D74

Suggested Citation

Child, Travers and Wright, Austin L. and Xiao, Yun, Aid Fragmentation and Corruption (November 6, 2023). University of Chicago, Becker Friedman Institute for Economics Working Paper No. 2021-69, Available at SSRN: https://ssrn.com/abstract=3869814 or http://dx.doi.org/10.2139/ssrn.3869814

Travers Child

China Europe International Business School (CEIBS) ( email )

Shanghai-Hongfeng Road
Shanghai 201206
Shanghai 201206
China

Austin L. Wright (Contact Author)

University of Chicago - Harris School of Public Policy ( email )

1307 E 60th St
Chicago, IL IL 60637
United States

HOME PAGE: http://www.austinlwright.com

Yun Xiao

University of Gothenburg - Department of Economics ( email )

Gothenburg
Sweden

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