Sources
Q1 – OECD – Official development assistance (ODA): Frequently asked questions
https://www.oecd.org/en/data/insights/data-explainers/2024/07/frequently-asked-questions-on-official-development-assistance-oda.html
Last accessed: 25.08.2026
“ODA can take the form of (i) grants, where financial resources are provided to developing countries free of interest and with no provision for repayment, or (ii) soft loans, which have to be repaid with interest, albeit at a significantly lower rate than if developing countries borrowed from commercial banks.”
“ODA includes activities carried out with the economic development and welfare of developing countries as their main objective. It is a measure of donor effort, including grants and grant equivalents of concessional loans.”
“Several types of activities can be counted as ODA depending on their nature and purpose. Eligibility is determined by: country eligibility, concessionality, promoting economic development and welfare in developing countries as the main objective.”
“Examples include peace and security expenditures, refugee support and migration-related activities. These could potentially qualify as ODA, provided they meet the core eligibility criteria.”
“ODA includes activities carried out with the economic development and welfare of developing countries as their main objective. It is a measure of donor effort, including grants and grant equivalents of concessional loans.”
“Several types of activities can be counted as ODA depending on their nature and purpose. Eligibility is determined by: country eligibility, concessionality, promoting economic development and welfare in developing countries as the main objective.”
“Examples include peace and security expenditures, refugee support and migration-related activities. These could potentially qualify as ODA, provided they meet the core eligibility criteria.”
Q2 – OECD – Official development assistance (ODA)
https://www.oecd.org/en/topics/policy-issues/official-development-assistance-oda.html
Last accessed: 25.08.2026
“ODA is financial support from official providers to aid recipients (low- and middle-income countries) in areas such as health, sanitation, education, and infrastructure. It mainly consists of either grants or "soft" loans and it makes up over two thirds of external finance for least-developed countries.”
Q3 – OECD – Net ODA
https://www.oecd.org/en/data/indicators/net-oda.html
Last accessed: 25.08.2026
“Official development assistance (ODA) is defined as government aid designed to promote the economic development and welfare of developing countries. Loans and credits for military purposes are excluded.”
“Aid may be provided bilaterally, from donor to recipient, or channelled through a multilateral development agency such as the United Nations or the World Bank. The OECD maintains a list of developing countries and territories; only aid to these countries counts as ODA.”
“Prior to 2018, the ODA flows basis methodology covered loans expressed on a ‘cash basis’, meaning their full face value was included, then repayments were subtracted as they came in. From 2018, the ODA grant-equivalent methodology is used whereby only the ‘grant portion’ of the loan, i.e. the amount ‘given’ by lending below market rates, counts as ODA.”
“Aid may be provided bilaterally, from donor to recipient, or channelled through a multilateral development agency such as the United Nations or the World Bank. The OECD maintains a list of developing countries and territories; only aid to these countries counts as ODA.”
“Prior to 2018, the ODA flows basis methodology covered loans expressed on a ‘cash basis’, meaning their full face value was included, then repayments were subtracted as they came in. From 2018, the ODA grant-equivalent methodology is used whereby only the ‘grant portion’ of the loan, i.e. the amount ‘given’ by lending below market rates, counts as ODA.”
Q4 – OECD – Untied aid
https://www.oecd.org/en/topics/sub-issues/oda-standards/untied-aid.html
Last accessed: 25.08.2026
“Almost half the value of untied contracts funded by DAC members was awarded to suppliers from the donor country in 2022-23. While this suggests a reasonable distribution, aggregate results conceal important variations across donors, ranging from 0% of contracts awarded to donor companies to 99% of contracts awarded.”
“The proportion of untied aid covered by the Recommendation has increased from 51% in 2000 to 87% in 2024.”
“The proportion of untied aid covered by the Recommendation has increased from 51% in 2000 to 87% in 2024.”
Q5 – OECD – DAC Recommendation on Untying ODA
https://legalinstruments.oecd.org/public/doc/140/140.en.pdf
Last accessed: 25.08.2026
“Untying aid, on the other hand, avoids unnecessary costs and gives the recipient the freedom to procure goods, services and works from virtually any country. This strengthens aid effectiveness, enhances partner country ownership, and supports local private sector development.”
“Tied aid also reduces opportunities for local suppliers to participate in ODA-funded procurement”
“Tied aid also reduces opportunities for local suppliers to participate in ODA-funded procurement”
Q6 – World Bank – How does infrastructure investment promote economic development in fragile regions of Africa?
https://blogs.worldbank.org/en/ppps/how-does-infrastructure-investment-promote-economic-development-fragile-regions-africa
Last accessed: 25.08.2026
“Infrastructure investments play a substantial role in structural transformation. Access to paved roads by itself has led workers to move out of low-productivity agriculture primarily into manufacturing and services in Kenya and Ethiopia. The size of the effect is a reduction of 9 percentage points in the share of the workforce employed in agriculture in the Horn of Africa”
“Access to internet has led workers to move out of low-productivity agriculture into services. The size of the effect is a reduction of 6 percentage points in the share of the workforce employed in agriculture in the Horn of Africa and 3 percentage points in Lake Chad”
“Bundling road investments with access to electricity leads to a much bigger impact. The share of employment in agriculture falls by as much as 20 percentage points in the Horn of Africa and 23 percentage points in Lake Chad”
“In the Horn of Africa, Somalia will benefit the most from the transport as well as combined energy and transport investments, as the new road corridors will largely increase its access to bigger regional markets and lead to important price reductions for goods exchanged in the region. Somalia’s annual real income is predicted to increase by 1.4% from the transport investments, by 6.2% when combined with major electricity improvements, and by 10% when border delays are additionally reduced.”
“However, the effects differ across locations within the country. The road investments will primarily benefit the border locations that gain the most in terms of market Access”
“While some regions do not benefit from road investments alone, all regions gain when infrastructure investments are combined with trade facilitation measures, as these help to amplify the affected area.”
“Access to internet has led workers to move out of low-productivity agriculture into services. The size of the effect is a reduction of 6 percentage points in the share of the workforce employed in agriculture in the Horn of Africa and 3 percentage points in Lake Chad”
“Bundling road investments with access to electricity leads to a much bigger impact. The share of employment in agriculture falls by as much as 20 percentage points in the Horn of Africa and 23 percentage points in Lake Chad”
“In the Horn of Africa, Somalia will benefit the most from the transport as well as combined energy and transport investments, as the new road corridors will largely increase its access to bigger regional markets and lead to important price reductions for goods exchanged in the region. Somalia’s annual real income is predicted to increase by 1.4% from the transport investments, by 6.2% when combined with major electricity improvements, and by 10% when border delays are additionally reduced.”
“However, the effects differ across locations within the country. The road investments will primarily benefit the border locations that gain the most in terms of market Access”
“While some regions do not benefit from road investments alone, all regions gain when infrastructure investments are combined with trade facilitation measures, as these help to amplify the affected area.”
Q8 – World Bank – The Impact of Infrastructure on Development Outcomes
https://documents1.worldbank.org/curated/en/099529203062342252/pdf/IDU0e42ae32f0048304f74086d102b6d7a900223.pdf
Last accessed: 25.08.2026
“the overwhelming balance of evidence suggests that infrastructure improvements are critical in supporting the development process.”
“Studies on digital infrastructure show that firm productivity, employment, and welfare increase with the arrival of broadband internet coverage.”
“the availability of mobile phones improves coordination between producers and traders and hence reduces the price dispersion of agricultural products.”
“Turning to rural electrification, significant literature documents the positive impact of infrastructure on household welfare, structural transformation, and human capital formation through increased labor force participation, more time spent on education, and increased indoor air quality.”
“Investments in the reliability of power supply also contribute to firms' productivity.”
“These include household welfare, employment, and human capital, as well as firm-level productivity, output, job creation, and trade; but, also, the impact on spatial patterns of economic activity in the urban and rural spheres.”
“households' income and consumption benefit from the existence of rural roads, highways are also found to contribute to firms' competitiveness. Similarly, public transportation, railways, and ports have positive impacts on the development process.”
“Studies on digital infrastructure show that firm productivity, employment, and welfare increase with the arrival of broadband internet coverage.”
“the availability of mobile phones improves coordination between producers and traders and hence reduces the price dispersion of agricultural products.”
“Turning to rural electrification, significant literature documents the positive impact of infrastructure on household welfare, structural transformation, and human capital formation through increased labor force participation, more time spent on education, and increased indoor air quality.”
“Investments in the reliability of power supply also contribute to firms' productivity.”
“These include household welfare, employment, and human capital, as well as firm-level productivity, output, job creation, and trade; but, also, the impact on spatial patterns of economic activity in the urban and rural spheres.”
“households' income and consumption benefit from the existence of rural roads, highways are also found to contribute to firms' competitiveness. Similarly, public transportation, railways, and ports have positive impacts on the development process.”
Q9 – Asian Development Bank – Infrastructure and Poverty Reduction: What is the Connection?
https://www.adb.org/sites/default/files/publication/28071/pb013.pdf
Last accessed: 25.08.2026
“A study by Fan et al. (2002), using provincial data, examines the effects of different types of government expenditures on growth and rural poverty in Peopleís Republic of China (PRC). They find that roads significantly reduce poverty incidence through agricultural productivity and nonfarm employment. The estimated elasticities with respect to road density are 0.08 for agricultural GDP per worker, 0.10 for nonagricultural employment, and 0.15 for wages of nonagricultural workers in rural areas. Among government infrastructure projects, rural roads are found to have the largest impact on poverty incidence: for every 10,000 yuan invested on rural roads, 3.2 poor persons are estimated to be lifted out of poverty.”
“Rural infrastructure investments can lead to higher farm and nonfarm productivity, employment and income opportunities, and increased availability of wage goods, thereby reducing poverty by raising mean income and consumption.”
“Rural infrastructure investments can lead to higher farm and nonfarm productivity, employment and income opportunities, and increased availability of wage goods, thereby reducing poverty by raising mean income and consumption.”
Q10 – Kessel et al. – Local Sourcing and Supplier Development in Global Health
https://www.researchgate.net/publication/328085113_Local_Sourcing_and_Supplier_Development_in_Global_Health_Analysis_of_the_Supply_Chain_Management_System's_Local_Procurement_in_4_Countries
Last accessed: 25.08.2026
“Local suppliers reported that after doing business with PEPFAR's global procurement and distribution project for essential HIV/AIDS medicines and supplies, they achieved revenue and asset growth, improved their quality standards, acquired new contracts with other businesses, and hired more employees.”
“SCMS local suppliers reported new contracts with other businesses (77%), new assets acquired (67%), increased access to capital from local lending institutions (75%), offering more products and services (92%), and ability to negotiate better prices from their principles (80%). Additionally, 70% (n=27) of the businesses hired between 1 and 30 new employees after receiving their first SCMS contract and 15% (n=6) hired between 30 and 100 new employees.”
“it is difficult or impossible to find local suppliers who meet the international quality standards or capability requirements needed to expand the supply chain. Supplier development should be a key part of public and NGO procurement in such markets.”
“local procurement may not work for all product and geographical markets”
“SCMS local suppliers reported new contracts with other businesses (77%), new assets acquired (67%), increased access to capital from local lending institutions (75%), offering more products and services (92%), and ability to negotiate better prices from their principles (80%). Additionally, 70% (n=27) of the businesses hired between 1 and 30 new employees after receiving their first SCMS contract and 15% (n=6) hired between 30 and 100 new employees.”
“it is difficult or impossible to find local suppliers who meet the international quality standards or capability requirements needed to expand the supply chain. Supplier development should be a key part of public and NGO procurement in such markets.”
“local procurement may not work for all product and geographical markets”
Q11 – FAO – The State of Food and Agriculture: Food aid for food security?
https://www.fao.org/4/a0800e/a0886e.pdf
Last accessed: 25.08.2026
“Food aid can depress and destabilize market prices in recipient countries, but there is scant evidence linking these price effects to negative outcomes for local agricultural production and development. Case studies show that food aid is more likely to destabilize local prices and undermine the livelihoods of local producers and traders when it arrives at the wrong time or is poorly targeted.”
“The empirical evidence shows that food aid does not create dependency because it is too unpredictable and too small for people to rely on. Concerns over dependency should not be used to deprive needy people of required assistance.”
“Use in-kind commodity food aid only where food insecurity is caused by a shortage of food. Where food is available but vulnerable groups lack access to it, targeted cash assistance or food vouchers will be more effective and will not undermine local markets.”
“food aid falls when prices are high – just when it is most needed.”
“Emergency food aid and other social safety nets are essential to prevent transitory shocks from driving people into chronic destitution and hunger, but cannot by themselves overcome the underlying social and economic causes of poverty and hunger.”
“Donors should avoid falling into a ‘relief trap’ in which longer-term needs are neglected.”
“Use local and regional food-aid procurement where appropriate, but do not mandate it. Such interventions may support market development, but may also result in inflated food prices paid by poor consumers and create unsustainable market incentives for food producers and traders”
“The empirical evidence shows that food aid does not create dependency because it is too unpredictable and too small for people to rely on. Concerns over dependency should not be used to deprive needy people of required assistance.”
“Use in-kind commodity food aid only where food insecurity is caused by a shortage of food. Where food is available but vulnerable groups lack access to it, targeted cash assistance or food vouchers will be more effective and will not undermine local markets.”
“food aid falls when prices are high – just when it is most needed.”
“Emergency food aid and other social safety nets are essential to prevent transitory shocks from driving people into chronic destitution and hunger, but cannot by themselves overcome the underlying social and economic causes of poverty and hunger.”
“Donors should avoid falling into a ‘relief trap’ in which longer-term needs are neglected.”
“Use local and regional food-aid procurement where appropriate, but do not mandate it. Such interventions may support market development, but may also result in inflated food prices paid by poor consumers and create unsustainable market incentives for food producers and traders”
Q12 – Brookings – Aid procurement and the development of local industry: A question for Africa
https://www.brookings.edu/articles/aid-procurement-and-the-development-of-local-industry-a-question-for-africa/
Last accessed: 25.08.2026
“Public procurement—the purchase of goods, works, and services by governments—represents a significant portion of this market, making up an estimated average of 15 to 30 percent of a country’s GDP. Procurement in the developing world is especially noteworthy, since large projects are often partially or wholly financed by external donors such as the World Bank and other international financial institutions (IFIs), which encourage developing country governments to internationally advertise the goods, works, or services they require and to select the most competitive bid they receive.”
“we consider the theory that international competition in developing-world procurement has become a key instrument through which local industry has advanced in some countries and regions and a main indicator of where it has lagged in others.”
“Notably, we find evidence of a ‘civil works lag’ in sub-Saharan Africa, whereby local competitiveness in the construction industry has developed more slowly there than in other regions.”
“we consider the theory that international competition in developing-world procurement has become a key instrument through which local industry has advanced in some countries and regions and a main indicator of where it has lagged in others.”
“Notably, we find evidence of a ‘civil works lag’ in sub-Saharan Africa, whereby local competitiveness in the construction industry has developed more slowly there than in other regions.”
Q13 – World Bank – Infrastructure Services in Developing Countries: Access, Quality, and Policy Implications
https://documents1.worldbank.org/curated/en/476891468782346365/pdf/wps3468.pdf
Last accessed: 25.08.2026
“There is evidence that shifting resources toward maintenance can have positive consequences for GDP and welfare. For example, Rioja (1999), using data for seven Latin American countries, found that they allocate two-thirds over their resources to new infrastructure investment and only one-third to maintenance, a pattern that was exacerbated by international donors. Shifting just 20% of donor aid away from investment and toward maintenance would raise GDP and welfare by about 15% in the long run.”
“Preventive maintenance lowers operating costs, reduces adverse external impacts, and extends asset life—savings that are generally underestimated when maintenance budgets are cut to meet fiscal targets.”
“Thus it is through this channel that costs are lowered and, most importantly, market opportunities are expanded (especially through telecommunications and transport). The resulting gains in competitiveness and production are what drive the gains in economic growth and ultimately welfare.”
“Access to infrastructure can have little effect, however, if services are not affordable, and appropriate pricing of services often has been the most controversial aspect of sector reform.”
“Preventive maintenance lowers operating costs, reduces adverse external impacts, and extends asset life—savings that are generally underestimated when maintenance budgets are cut to meet fiscal targets.”
“Thus it is through this channel that costs are lowered and, most importantly, market opportunities are expanded (especially through telecommunications and transport). The resulting gains in competitiveness and production are what drive the gains in economic growth and ultimately welfare.”
“Access to infrastructure can have little effect, however, if services are not affordable, and appropriate pricing of services often has been the most controversial aspect of sector reform.”
Q14 – World Bank – Infrastructure Services in Developing Countries: Access, Quality, and Policy Implications
https://documents1.worldbank.org/curated/en/476891468782346365/pdf/wps3468.pdf
Last accessed: 25.08.2026
“they allocate two-thirds over their resources to new infrastructure investment and only one-third to maintenance, a pattern that was exacerbated by international donors. Shifting just 20% of donor aid away from investment and toward maintenance would raise GDP and welfare by about 15% in the long run.”
Q15 – Adam/Aalok – Aid Flows and “Dutch Disease” in a General Equilibrium Framework for Pakistan
https://www.sciencedirect.com/science/article/abs/pii/S016189389700001X
Last accessed: 25.08.2026
“Aid inflows may lead, for instance, to an appreciation of the real exchange rate and thereby reduce the competitiveness of the exports of the recipient country.”
“This so-called Dutch disease effect of aid operates through the spending effect, as analyzed in the framework of dependent economy models (e.g.,Van Wijnbergen 1986). Aid-financed activity leads to higher domestic demand, some of which for nontradables. The price of nontradables will rise and because the price of tradables is assumed to be given (small country assumption), there will be an appreciation of the exchange rate. This effect per se can hardly be called a ‘disease,’ of course, because a reversal of relative prices after a reduction of aid inflows could restore competitiveness. An adjustment problem (‘the disease’) emerges if through some market imperfection (e.g., rigidities in wage adjustment or government spending, or credit rationing in financial markets) the reverse resource shift toward more tradables production is hampered.”
“The model simulations show that the growth of Pakistan's economy was not foreign exchange constrained during the 1980s.”
“This so-called Dutch disease effect of aid operates through the spending effect, as analyzed in the framework of dependent economy models (e.g.,Van Wijnbergen 1986). Aid-financed activity leads to higher domestic demand, some of which for nontradables. The price of nontradables will rise and because the price of tradables is assumed to be given (small country assumption), there will be an appreciation of the exchange rate. This effect per se can hardly be called a ‘disease,’ of course, because a reversal of relative prices after a reduction of aid inflows could restore competitiveness. An adjustment problem (‘the disease’) emerges if through some market imperfection (e.g., rigidities in wage adjustment or government spending, or credit rationing in financial markets) the reverse resource shift toward more tradables production is hampered.”
“The model simulations show that the growth of Pakistan's economy was not foreign exchange constrained during the 1980s.”
Q16 – Ating/Essa – Aid—real exchange rate Nexus: Empirical evidence from Ghana
https://www.tandfonline.com/doi/full/10.1080/23322039.2018.1499184
Last accessed: 25.08.2026
“Based on the Dutch disease theory, increase in aid inflows leads to appreciation of real exchange rate as a result of increase demand for non-tradable goods and subsequently increase in prices of non-tradable goods as the money is spent domestically (Van Wijnbergen, Citation1984, Citation1985).”
“The contentious effect of foreign aid on real exchange rate in developing countries leading to Dutch disease necessitates further research since its impact can only be determined empirically.”
“Hence, policy advice that can be given based on the finding is that Ghana government must try as much as possible to direct aid to boost the productive size of the economy so that the adverse impact of appreciation of the exchange rate on the growth of the economy can be nullified by supply response. Applying the ordinary least squares estimation technique, the study reveals that real exchange rate is positively impacted by the inflows of aid, even though the aid flows to Ghana are on the high side.”
“The contentious effect of foreign aid on real exchange rate in developing countries leading to Dutch disease necessitates further research since its impact can only be determined empirically.”
“Hence, policy advice that can be given based on the finding is that Ghana government must try as much as possible to direct aid to boost the productive size of the economy so that the adverse impact of appreciation of the exchange rate on the growth of the economy can be nullified by supply response. Applying the ordinary least squares estimation technique, the study reveals that real exchange rate is positively impacted by the inflows of aid, even though the aid flows to Ghana are on the high side.”
Q17 – World Bank – Elite Capture of Foreign Aid: Evidence from Offshore Bank Accounts
https://documents1.worldbank.org/curated/en/493201582052636710/pdf/Elite-Capture-of-Foreign-Aid-Evidence-from-Offshore-Bank-Accounts.pdf
Last accessed: 25.08.2026
“Do elites capture foreign aid? This paper documents that aid disbursements to highly aid-dependent countries coincide with sharp increases in bank deposits in offshore financial centers known for bank secrecy and private wealth management, but not in other financial centers.”
“The estimates are not confounded by contemporaneous shocks such as civil conflicts, natural disasters, and financial crises, and are robust to instrumenting with predetermined aid commitments. The implied leakage rate is around 7.5 percent at the sample mean and tends to increase with the ratio of aid to GDP. The findings are consistent with aid capture in the most aid-dependent countries.”
“In our main sample comprising the 22 most aid-dependent countries in the world (in terms of WB aid)”
“These modest leakage rates represent a lower bound in the sense that they only include aid diverted to foreign accounts and not money spent on real estate, luxury goods etcetera.”
“On the other hand, raising the threshold to 3% of GDP (sample of 7 countries), we find a higher leakage rate of around 15%.”
“The estimates are not confounded by contemporaneous shocks such as civil conflicts, natural disasters, and financial crises, and are robust to instrumenting with predetermined aid commitments. The implied leakage rate is around 7.5 percent at the sample mean and tends to increase with the ratio of aid to GDP. The findings are consistent with aid capture in the most aid-dependent countries.”
“In our main sample comprising the 22 most aid-dependent countries in the world (in terms of WB aid)”
“These modest leakage rates represent a lower bound in the sense that they only include aid diverted to foreign accounts and not money spent on real estate, luxury goods etcetera.”
“On the other hand, raising the threshold to 3% of GDP (sample of 7 countries), we find a higher leakage rate of around 15%.”
Q18 – Shon/Lee/Kim – Spatial pattern of aid allocation in the early 21st century
https://www.sciencedirect.com/science/article/pii/S1056819024000459
Last accessed: 25.08.2026
“By incorporating the Multidimensional Poverty Index (MPI) with aid expenditure data, we reveal that more impoverished regions, as defined by higher MPI scores, receive less aid compared to regions with high urbanicity. This pattern of exclusion shows significant spatial clusters within adjacent regions within and across countries and has persisted over the years.”
Q19 – World Bank – Infrastructure investment in fragile regions of Africa
https://blogs.worldbank.org/en/ppps/how-does-infrastructure-investment-promote-economic-development-fragile-regions-africa
Last accessed: 25.08.2026
“In the Horn of Africa, Somalia will benefit the most from the transport as well as combined energy and transport investments, as the new road corridors will largely increase its access to bigger regional markets and lead to important price reductions for goods exchanged in the region. Somalia’s annual real income is predicted to increase by 1.4% from the transport investments, by 6.2% when combined with major electricity improvements, and by 10% when border delays are additionally reduced. However, the effects differ across locations within the country. The road investments will primarily benefit the border locations that gain the most in terms of market access. While some regions do not benefit from road investments alone, all regions gain when infrastructure investments are combined with trade facilitation measures, as these help to amplify the affected area.”
Q20 – Nunnenkamp/Öhler/Sosa Andrés – Which aid targets poor at the sub-national level?
https://www.sciencedirect.com/science/article/abs/pii/S2452292920300011
Last accessed: 25.08.2026
“For instance, a subnational aid allocation study in India helped explore striking regional disparities that affected the location of aid projects (Nunnenkamp, Öhler, & Sosa Andrés, 2017). Second, analysis of aid allocation and disbursement by geographic region can inform decisions that can have a direct impact on the degree to which aid is effective, including whether or not it is optimally distributed for achieving intended results, as well as from the perspective of reaching those most in need.”
Q21 – Powell/Findley – The Swarm Principle: A Sub-National Spatial Analysis of Aid Targeting and Donor Coordination in Sub-Saharan Africa
https://stabilityjournal.org/articles/10.5334/sta.669
Last accessed: 25.08.2026
“Results indicate that foreign donors target poverty in some countries but not others, and higher co-financing is associated with lower quality targeting across all cases.”
“In the DRC, there is little evidence that donors target their aid to impoverished areas. First, the correlation between levels of aid and poverty is negative (–0.320), suggesting that aid is going to areas with lower poverty. Additionally, the aid concentration ratio (0.149) is lower than the poverty concentration ratio (0.361), suggesting that less aid is going to the three poorest divisions proportional to their share of the country’s poverty. So, aid in general is not associated with poverty at the local level, and the poorest areas do not receive a proportion of aid relative to the amount of poverty located there. The quality of aid targeting is rated as poor in the DRC.”
“In the DRC, there is little evidence that donors target their aid to impoverished areas. First, the correlation between levels of aid and poverty is negative (–0.320), suggesting that aid is going to areas with lower poverty. Additionally, the aid concentration ratio (0.149) is lower than the poverty concentration ratio (0.361), suggesting that less aid is going to the three poorest divisions proportional to their share of the country’s poverty. So, aid in general is not associated with poverty at the local level, and the poorest areas do not receive a proportion of aid relative to the amount of poverty located there. The quality of aid targeting is rated as poor in the DRC.”
Q22 – Burnside/Dollar – Aid, Policies, and Growth: Revisiting the Evidence
https://documents1.worldbank.org/curated/en/992381468780325835/pdf/wps3251Aid.pdf
Last accessed: 25.08.2026
“Given that institutions and policies are important for growth and that aid has had little systematic effect on institutions and policies, we introduced the hypothesis that the impact of aid on growth is conditional on these same institutions and policies.”
“Burnside and Dollar (2000a), we added a rule of law measure to the index), and found that aid had a positive effect on growth in developing countries with significantly better than average institutions and policies, whereas aid had no positive effect in countries with average policies”
“There is no support for the competing hypothesis that aid has the same positive effect everywhere.”
“evidence that aid accelerates growth in developing countries with sound institutions and policies, but has less or no effect in countries in which institutions and policies are poor.”
“it found overwhelming support for the view that corruption often limits the effectiveness of aid”
“Burnside and Dollar (2000a), we added a rule of law measure to the index), and found that aid had a positive effect on growth in developing countries with significantly better than average institutions and policies, whereas aid had no positive effect in countries with average policies”
“There is no support for the competing hypothesis that aid has the same positive effect everywhere.”
“evidence that aid accelerates growth in developing countries with sound institutions and policies, but has less or no effect in countries in which institutions and policies are poor.”
“it found overwhelming support for the view that corruption often limits the effectiveness of aid”
Q23 – Easterly/Levine/Roodman – New Data, New Doubts: A Comment on Burnside and Dollar's “Aid, Policies, and Growth”
https://www.nber.org/papers/w9846
Last accessed: 25.08.2026
“The Burnside and Dollar (2000, AER) finding that aid raises growth in a good policy environment has had an important influence on policy and academic debates. We conduct a data gathering exercise that updates their data from 1970 -93 to 1970 -97, as well as filling in missing data for the original period 1970 -93. We find that the Burnside and Dollar (2002, AER) finding is not robust to the use of this additional data.”
Q24 – World Bank Independent Evaluation Group – World Bank Group Engagement in Georgia: Support for Connectivity Infrastructure
https://ieg.worldbankgroup.org/evaluations/world-bank-group-georgia/chapter-4-support-connectivity-infrastructure
Last accessed: 25.08.2026
“It started in 2006 with World Bank financing and subsequently attracted financing from other multilateral development banks. The World Bank’s role was prominent in establishing the original program, coordinating aspects of implementation, and setting standards, with other development partners taking on an increasing share of the financing.”
“Implementation of the EWH corridor program was successful. The Third East-West Highway Improvement Project and the Fourth East-West Highway Improvement Project were completed during the evaluation period with infrastructure works and achieved most outcome indicators, such as a reduction in vehicle operating costs, reduction in travel time, and decrease in road fatalities.”
“Georgia had a history of insufficient road maintenance contributing to the depletion of capital stock, leading to large reinvestment needs.”
“At the start of the evaluation period, the country lacked methodologies and systems of estimating and tracking maintenance needs with insufficient budget allocations (IMF 2018), and expenditures on maintenance averaged less than $2,500 per kilometer per year compared with international benchmarks of $4,000 per kilometer.”
“According to a 2020 estimate, about 20 percent of Kakheti produce is lost during the postharvest stage because of inadequate roads (World Bank 2022d).”
“Implementation of the EWH corridor program was successful. The Third East-West Highway Improvement Project and the Fourth East-West Highway Improvement Project were completed during the evaluation period with infrastructure works and achieved most outcome indicators, such as a reduction in vehicle operating costs, reduction in travel time, and decrease in road fatalities.”
“Georgia had a history of insufficient road maintenance contributing to the depletion of capital stock, leading to large reinvestment needs.”
“At the start of the evaluation period, the country lacked methodologies and systems of estimating and tracking maintenance needs with insufficient budget allocations (IMF 2018), and expenditures on maintenance averaged less than $2,500 per kilometer per year compared with international benchmarks of $4,000 per kilometer.”
“According to a 2020 estimate, about 20 percent of Kakheti produce is lost during the postharvest stage because of inadequate roads (World Bank 2022d).”
Q25 – Dang et al. – The impact of ODA in constructing road traffic infrastructure on Vietnam's economic growth
https://www.growingscience.com/jpm/Vol6/jpm_2020_18.pdf
Last accessed: 25.08.2026
“The study examines the impact of official development assistance (ODA) in constructing road transport infrastructure on Vietnam's economic growth. The authors select gross domestic product (GDP) to represent economic growth and test the influence of ODA in constructing road traffic infrastructure on Vietnam's GDP.”
“The regression results show that the ODA had a positive impact on GDP. Moreover, ODA plays an important role in constructing road transport infrastructure on Vietnam's economic growth.”
“Many authors have studied and evaluated the impact of ODA on economic growth and argued many different explanations, but the results of the study are generally inconsistent.”
“The regression results show that the ODA had a positive impact on GDP. Moreover, ODA plays an important role in constructing road transport infrastructure on Vietnam's economic growth.”
“Many authors have studied and evaluated the impact of ODA on economic growth and argued many different explanations, but the results of the study are generally inconsistent.”
Q26 – Encyclopaedia Britannica – Dutch disease
https://www.britannica.com/money/Dutch-disease
Last accessed: 26.08.2026
“When a country suddenly discovers a big natural resources asset—whether it be fossil fuels, minerals, or something else—there can be an influx of highly paid international workers from multinational oil and gas or mining companies. That boosts local economies temporarily, but it can also cause the local currency to rise in a way that disadvantages locals working in other sectors.”
“Currency appreciation. Once a petroleum project or mine becomes operational, strong export revenues can drive up the local currency further, even though those exports are only from one narrow part of the economy.”
“Import/export imbalance. A strong local currency ends up hurting exports of industries that don’t rely on extracting natural resources by making their goods more expensive abroad. And a currency that is stronger locally than internationally also encourages imports, which can come at the expense of local manufacturing jobs.”
“Currency appreciation. Once a petroleum project or mine becomes operational, strong export revenues can drive up the local currency further, even though those exports are only from one narrow part of the economy.”
“Import/export imbalance. A strong local currency ends up hurting exports of industries that don’t rely on extracting natural resources by making their goods more expensive abroad. And a currency that is stronger locally than internationally also encourages imports, which can come at the expense of local manufacturing jobs.”
Graphic Sources
VG1 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Map of fictional country X with symbols for potential aid projects (road, hospital, school). Arrows from donor countries (flag icons) to country X, labeled "ODA: Grants / Soft Loans". Color gradient: #833AB4 (top), #E1306C (middle), #FF5F1F (bottom).”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Map of fictional country X with symbols for potential aid projects (road, hospital, school). Arrows from donor countries (flag icons) to country X, labeled "ODA: Grants / Soft Loans". Color gradient: #833AB4 (top), #E1306C (middle), #FF5F1F (bottom).”
Created: 26.08.2026
VG2 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Before/after map of country X: Before: Isolated regions (gray), long arrows with clock symbols (travel time). After: Connected regions (color gradient #833AB4 to #FF5F1F), shorter arrows, symbols for markets/industry. Flow diagram: Aid → Road/Electricity Construction → Lower Transport Costs → Market Access (arrows only, no text).”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Before/after map of country X: Before: Isolated regions (gray), long arrows with clock symbols (travel time). After: Connected regions (color gradient #833AB4 to #FF5F1F), shorter arrows, symbols for markets/industry. Flow diagram: Aid → Road/Electricity Construction → Lower Transport Costs → Market Access (arrows only, no text).”
Created: 26.08.2026
VG3 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Flow diagram: Tied Aid: Arrow from donor country firm (flag icon) to project in country X (construction site with foreign flag). Untied Aid: Arrow from "Open Procurement" to project with three branches: Donor country supplier (donor flag), local firm (country X flag), third-country supplier (neutral flag). Note below diagram: "~50% of untied contract value to donor-country suppliers (2022–23)". Additional note: "Public procurement in developing countries, often aid-funded, can represent 15–30% of GDP and encourage international competition."”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Flow diagram: Tied Aid: Arrow from donor country firm (flag icon) to project in country X (construction site with foreign flag). Untied Aid: Arrow from "Open Procurement" to project with three branches: Donor country supplier (donor flag), local firm (country X flag), third-country supplier (neutral flag). Note below diagram: "~50% of untied contract value to donor-country suppliers (2022–23)". Additional note: "Public procurement in developing countries, often aid-funded, can represent 15–30% of GDP and encourage international competition."”
Created: 26.08.2026
VG4 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Two scenarios on a map of country X: Left: Region with food shortage (empty shelves symbol) → Food Aid (truck with food). Right: Region with available food (market stall symbol) but poor population (empty wallet symbol) → Cash/Vouchers (money symbol).”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Two scenarios on a map of country X: Left: Region with food shortage (empty shelves symbol) → Food Aid (truck with food). Right: Region with available food (market stall symbol) but poor population (empty wallet symbol) → Cash/Vouchers (money symbol).”
Created: 26.08.2026
VG5 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Map of country X: Cities: Symbols for aid projects (hospital, school, road). Rural areas: Marked as "High Urbanicity vs. High MPI" (red hatching for high MPI, no projects). Note: "Spatial targeting varies significantly between countries".”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Map of country X: Cities: Symbols for aid projects (hospital, school, road). Rural areas: Marked as "High Urbanicity vs. High MPI" (red hatching for high MPI, no projects). Note: "Spatial targeting varies significantly between countries".”
Created: 26.08.2026
VG6 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Before/after images: New road: Smooth, well-paved. Deteriorated road: Cracks, potholes. Bar chart: "Investment vs. Maintenance" (2/3 for new construction, 1/3 for maintenance). Note: "Shifting 20% from investment to maintenance → +15% GDP/welfare (7 Latin American countries)".”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Before/after images: New road: Smooth, well-paved. Deteriorated road: Cracks, potholes. Bar chart: "Investment vs. Maintenance" (2/3 for new construction, 1/3 for maintenance). Note: "Shifting 20% from investment to maintenance → +15% GDP/welfare (7 Latin American countries)".”
Created: 26.08.2026
VG7 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Flow diagram: Aid Disbursement (money bag symbol). Observed increase in offshore deposits (arrow to bank symbol with warning sign). Note: "Implied leakage rate: ~7.5% at sample mean. Findings are consistent with aid capture in highly aid-dependent countries."”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Flow diagram: Aid Disbursement (money bag symbol). Observed increase in offshore deposits (arrow to bank symbol with warning sign). Note: "Implied leakage rate: ~7.5% at sample mean. Findings are consistent with aid capture in highly aid-dependent countries."”
Created: 26.08.2026
VG8 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Aid-financed activity (arrow up) → Higher Demand for Non-Tradables (service sector symbol) → Currency Appreciation (arrow up at currency symbol) → Exports More Expensive (arrow down at export symbol). Note: "Aid-financed activity may appreciate the real exchange rate. An adjustment problem emerges if market imperfections hinder the reverse resource shift."”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Aid-financed activity (arrow up) → Higher Demand for Non-Tradables (service sector symbol) → Currency Appreciation (arrow up at currency symbol) → Exports More Expensive (arrow down at export symbol). Note: "Aid-financed activity may appreciate the real exchange rate. An adjustment problem emerges if market imperfections hinder the reverse resource shift."”
Created: 26.08.2026
VG9 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Two studies side by side: Left: "Aid × Strong Institutions → Higher Growth" (green arrow). Right: "Re-analysis: Result Not Robust" (red question mark). Note: "The evidence does not support one simple universal rule; results depend on the data, methods and circumstances examined."”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Two studies side by side: Left: "Aid × Strong Institutions → Higher Growth" (green arrow). Right: "Re-analysis: Result Not Robust" (red question mark). Note: "The evidence does not support one simple universal rule; results depend on the data, methods and circumstances examined."”
Created: 26.08.2026
VG10 – AI-generated image
Created with OpenAI DALL·E (text-to-image model),
based on a custom prompt by the author.
Prompt: “Central graphic: "Development Aid" in the middle with 6 branching arrows to: Project (road symbol), Location (map of country X), Procurement (contract symbol), Local Market (market stall symbol), Maintenance (tool symbol), Institutions (scales of justice symbol). Note: "Different combinations → Different outcomes".”
Created: 26.08.2026
based on a custom prompt by the author.
Prompt: “Central graphic: "Development Aid" in the middle with 6 branching arrows to: Project (road symbol), Location (map of country X), Procurement (contract symbol), Local Market (market stall symbol), Maintenance (tool symbol), Institutions (scales of justice symbol). Note: "Different combinations → Different outcomes".”
Created: 26.08.2026