International Development Organizations and National Corruption
Emilie Hafner-Burton, Lauren E. Lee, Christina J. Schneider
December, 2016
Abstract
International development organizations (IDOs) provide billions of dollars in aid to developing countries. Many IDOs have official criteria for aid selectivity, based on the idea that development aid is most effective in the absence of corruption. There remains, however, substantial debate and conflicting evidence over whether donors are actually responsive to allegations of corruption in potential recipient states. Our central argument is that the extent to which corruption factors into both IDO allocation rules and decisions depends on the composition of the donors within these IDOs. Using newly collected data on anti-corruption mandates, alongside existing data on aid flows for the period of 1984-2013, we demonstrate that organizations composed of highly corrupted donors are just as likely to adopt—but less likely to enforce—anti-corruption standards as are organizations composed of more honest donors. More corrupt recipient states receive more aid, more corrupt organizations give more aid, and more corrupt organizations funnel more of that aid to corrupt recipients.Keywords:
international development aid, corruption, donor characteristics