Skip to content

Donors seem to think Democracy is Only for Rich, Not for Poor

The international aid system has a dirty secret. Despite much rhetoric to the contrary, the nations and organizations that donate and distribute aid do not care much about democracy and they still actively support dictators. The conventional narrative is that donors supported dictators only during the cold war and ever since have promoted democracy. This is wrong.

Mo Ibrahim said:

All Africans have a right to live in freedom and prosperity and to select their leaders through fair and democratic elections, and the time has come when Africans are no longer willing to accept lower standards of governance than those in the rest of the world.

He knows that recognition of democratic values eventually leads to their realization; lack of recognition continues the subjugation of the poor.

See my whole article at the New York Review of Books

Be Sociable, Share!
This entry was posted in Academic research, Aid policies and approaches, Data and statistics, Democracy and freedom and tagged , , . Bookmark the permalink. Follow any comments here with the RSS feed for this post. Both comments and trackbacks are currently closed.

31 Comments

  1. anon wrote:

    between stopping starvation and saving lives, and making a futile gesture that does nothing to end injustice and tyranny, i prefer the former.

    Posted November 8, 2010 at 2:32 am | Permalink
  2. Anon for this wrote:

    I have been living and working on development projects in many of the countries you mention in the article. I’ve been working on projects where the money goes to local and international groups to do work in country. It is not directly government aid or budget support.

    In the article, you didn’t differentiate between direct budget support and projectized aid. Do you think it makes a difference?

    Posted November 8, 2010 at 2:51 am | Permalink
  3. Don Stoll wrote:

    Your full, scathing NYRB article suggests to me the grim conclusion that aid donors generally believe, contrary to Mo Ibrahim’s assertion, that Africans are still willing to accept lower standards of governance than those in the rest of the world—maybe because, the thinking might go, they’re ready for nothing better?

    However, you conclude your blog post less persuasively. That “recognition of democratic values eventually leads to their realization” is a noble sentiment is plain enough, and I certainly want to believe it. Yet can we support it empirically? Or is it possible instead that places where we see democratic values realized had shared other precedents and that these, rather than recognition of democratic values, led to realization of the latter?

    I don’t propose an opinion, merely a question for research–but an important question, I believe.

    Posted November 8, 2010 at 3:29 am | Permalink
  4. Jim wrote:

    Anon beat me to it. ‘Aid given in dictatorships’ is not the same as ‘Aid given to dictatorships’. Unless, of course, you’re trying to make aid look as bad as possible!

    Posted November 8, 2010 at 4:55 am | Permalink
  5. William Easterly wrote:

    Sad to hear democracy (including human rights as the article makes clear) dismissed as a “futile gesture”, and why do you think dictators are so good at ensuring material needs are met?

    Project aid to dictatorial countries still finances dictators becasue (1) dictators can reduce their own spending in project area and redirect it to their own preferred spending, (2) dictators can manipulate aid project spending for political gain and longer survival in power. I concede it is possible that (1) dictators are spending nothing in some area and so project aid would succeed in increasing spending in that area, and (2) there could be safeguards against political manipulation. But the burden of proof is on anyone who wants to give aid to autocratic countries, as the opportunity cost of aid to autocracies is aid that could have gone to democracies.

    Posted November 8, 2010 at 7:59 am | Permalink
  6. Andy wrote:

    Bill, should I conclude that cutting off aid to dictatorships is this main takeaway of your argument here? Busy people don’t have time to read your NYRB piece in full.

    Posted November 8, 2010 at 8:18 am | Permalink
  7. William Easterly wrote:

    Andy, the answer to your question is YES. However, I am a little worried that you would just accept my conclusion without reading my arguments for the conclusion.

    Posted November 8, 2010 at 8:52 am | Permalink
  8. Matthias wrote:

    Just a practical question, does using other indexes of sociopolitical freedom change the picture at all? I mean, does replacing the Freedom House Index and using the Polity IV data show anything different?

    Posted November 8, 2010 at 9:02 am | Permalink
  9. Erin wrote:

    Providing aid in dictatorships is not the same as giving aid to dictators. Should we let people starve, provide no support for reform or opposition movements, no funds for educating children, allow citizens of dictatorships to have no interaction with free societies at all? A lack of aid actually serves to strengthen dictatorships and rally the citizenry against the outside world, not to free the society.

    After all, the lack of aid dollars has worked so well to promote freedom in Burma and North Korea.

    Posted November 8, 2010 at 9:49 am | Permalink
  10. Its a crying shame wrote:

    The world and World Bank et al cut off all but humanitarian aid to Madagascar following the 2009 coup. With no aid to steal the bandits in government have logged the national parks for precious hardwood and sold it to Chinese companies.
    http://www.youtube.com/watch?v=w-pHW50h494
    They have sold mining concessions to Chinese companies for $100Mn advance payments. AGOA was canceled as well as MCA with sad, bad effects on the People but no apparent pain to the 36 yo former nightclub DJ, high school dropout, transitional president and his cronies.
    This current leaders father in law bought a $900,000 house last week on the nearby island of Mauritius. btw Expensive houses in Mauritius come with residence visas. (makes for a comfortable exile) Aid would make a difference to the lives of the people living under this non democratic government and probably to the elite as well but stopping aid does not yet seem to have had any effect on bringing back democracy.

    Posted November 8, 2010 at 9:59 am | Permalink
  11. Sarah wrote:

    I have done some work on aid allocation that suggests that donors give different “baskets” of aid to recipients with different quality of governance. This effect is mostly seen in broader governance measures (like World Bank or ICRG), rather than democracy measures. Still, poorly governed countries receive aid for social sector programs and humanitarian assistance, while better governed countries are significantly more likely to receive aid for budget support, economic infrastructure, and production sectors. This is a recent trend – no evidence that donors discriminated across category of aid during the cold war – which may suggest improvements in allocation. The paper is on SSRN: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1681104 It also shows that donors still care about things like distance, former colonial status, immigration, etc – so aid is not allocated in a purely “altruistic” fashion, but at least in a manner more consistent with development. Still, it might get to the questions of budget support v. project aid and other measures of government raised in some of the posts.

    Posted November 8, 2010 at 11:17 am | Permalink
  12. Dan Kyba wrote:

    The point that aid under certain circumstances can act as a disincentive for the recipient government to invest in and protect the public goods necessary to underpin productive activity is pretty well a given. What is missing here is what aid to such governments over the long-term can do to the provider.

    What I am talking about is Oliver Williamson’s (Mechanisms of Governance) concept of bilateral dependency wherein for their mutual reduction of transaction costs both the aid buyer and aid supplier adjust their formal and informal norms in support of each other.

    This why some aid providers can be extremely homogenous, intolerant of ‘outsider’ criticism and from-to-time, subject to cannibalisation. The latter is due to very personalised and nasty infighting, since they tend to ignore the scientific method and the empirical literature that accrues.

    Consider how in this blog, the debate between Professors Sachs and Easterly is tempered by mutual reference and accountability to independent third-party evidence. In circumstances where that type of mutual reference and accountability is missing, the ego-driven killing, literal or otherwise, soon begins.

    Posted November 8, 2010 at 11:23 am | Permalink
  13. Becca Cougill wrote:

    If we offer aid to the people we also have a chance to talk directly to the people. It is only when these people have had enough, stand up and over throw the dictator, that any aid offered directly to the people will not be under a dictatorship. They cannot discover that they have that option until we are allowed in the country and can speak to them. The only way in is to offer aid.

    But, the truth is this. Who these people choose to be their leaders either by vote or by not overthrowing a bad goverement is not up to us to decide. We should be there to help the poor who most likely can’t even read much less know that they can choose to fight for a goverment that gives them a voice.

    It is exteamly arrogant of anyone to believe that because we offer aid to the poor of a country that we should have any say in how it is governed.

    Many countries have done it for themselves. The US threw off Britian, France threw off its King. Russia has changed goverment types due to civil wars and people rioting more times than I care to count. These third world countries may choose to do that themselves when they have been well fed by aid groups. They may choose not to but ultimatly that is their choice and charaity is never truely charity if we offer it with conditions.

    Posted November 8, 2010 at 11:29 am | Permalink
  14. Maurits wrote:

    Your response (comment #5 above) helps clarify some of the points in your NYR article. Still, I think you overlook at least two important considerations.

    First, project aid may serve to strengthen the political opposition. This almost certainly meets your requirement that aid go to a target the government is not inclined to spend anything on itself.

    Second, some aid may be sufficiently important to the recipients that it is valuable even after being reduced by a corrupt government taking its share.

    I elaborated on those points in a somewhat longer posting on my blog last week, when I first read the NYR article.

    Posted November 8, 2010 at 11:36 am | Permalink
  15. BPeterson wrote:

    Isn’t there a selection effect here? I haven’t read your paper yet, so maybe this is addressed. But I’m guessing that there are more “partly free” and “not free” developing countries in the world than “free” ones, so it seems intuitive that the lower categories on the FH scale would receive more aid than free countries. It would be better to weight this graph by per capita aid distributions, and to then have a separate graphic illustrating whether “partly free” and “not free” states receive a disproportionate share of aid relative to the percentage of the underdeveloped world that they comprise (both in terms of total countries and in terms of total people).

    Of course, I’ll have to read the piece when I have some more time.

    Posted November 8, 2010 at 11:50 am | Permalink
  16. Jim wrote:

    So, when the UK government funded (through its Governance and Transparency Fund) local civil society groups or global NGOs like Amnesty International to work in countries with poor governance like Angola and Sudan with the specific aims of “helping citizens hold their government to account” and “increasing the voice of ordinary citizens”, you count that as ‘aid to dictatorships’?

    Just curious.

    Posted November 8, 2010 at 1:15 pm | Permalink
  17. Dan Kyba wrote:

    @ Easterly

    Cutting off or threatening to cut off aid will not work since it is a buyer’s market.

    Posted November 8, 2010 at 1:32 pm | Permalink
  18. anonymous wrote:

    what caused the dip in 1992?

    Posted November 8, 2010 at 2:21 pm | Permalink
  19. Jeff wrote:

    Bill–

    Putting this post together with your previous posts about Madagascar leads me to conclude that in response to anti-democratic events you support cutting off aid, but maintaining trade preferences (AGOA). Is that right? If so, isn’t that splitting hairs a bit since as previous commentators have pointed out, project aid in the social realm can be more targeted to the poor than the benefits of trade? I don’t think “one- size” rules work and the metrics used by Freedom House to classify countries necessarily over simplify complex situations.

    Posted November 8, 2010 at 3:08 pm | Permalink
  20. Can I ask if you ever read the so-called land mark report ‘Assessing Aid’ and not least the debate it caused outside the bank?

    Posted November 8, 2010 at 3:38 pm | Permalink
  21. Response“… it caused outside the bank” is probably more what I meant.

    Posted November 8, 2010 at 3:41 pm | Permalink
  22. Sam Gardner wrote:

    One of the main issues at stake is the definition of “development”. It could mean anything and the contrary. This leads to muddled debates and multi-component indicators.

    Democratic governance, human rights, education, social services, economic freedom, each of the MDGs, are each seperate values, that should not be lumped together in an abstract concept like development.

    These values are overlapping and competing, very much like the 3D will never have an harmonious marriage. Making the choices, prioritize and budget for each value is a political process that is happening seldom consciently. This means it is happening by default. Most of the time by just keeping the money flowing. Expenditure is still the main goal of development, not results.

    Posted November 8, 2010 at 3:48 pm | Permalink
  23. 1. As so many aid critics, you lump together ‘aid’ as if it is one indistinguishable mash. Should we cut off emergency relief to dictatorships in case of a earthquake or tsunami? If not, what aid is permissible and what not? And why, as in your logic emergency relief is just as supportive for dictators as long-term aid?

    2. I thought by now that having the recipients involved in decisions about aid was standard best practice. Shouldn’t we ask the recipients in dictatorships what they would prefer: aid with the possibility that is not incontrovertibly supported by evidence that it might support the dictators, or no aid with the possibility that is not incontrovertibly supported by evidence that it might help dislodge the dictators?

    3. Much (not all) aid undoubtedly helps to save lives and relief suffering. Don’t you think that would put the burden of proof that withholding aid actually helps dislodge dictators on those who want to do so?

    Please, these are serious questions that I have and are not rhetoric at all. I am looking forward to your responses.

    Posted November 8, 2010 at 3:59 pm | Permalink
  24. Joe wrote:

    Highlighting perverse aid allocation patterns and calling out support for dictators is always welcome; however reality may be more complex than the take-away from your graph in this post. Previous comments have already made these points. I just want to point to some research which examines aid allocation and outcomes with respect to: (1) different types of aid (aid to governments and aid that bypasses governments); and (2) different measures of democracy.

    On the first point noted by anon and Jim, recent work suggests that governance matters for aid allocation by modality and type– though not necessarily in aggregate (Bermeo 2010a, Dietrich 2010). In the past decade, aid is more likely to be allocated to governments with good governance and to bypass governments with bad governance. This wasn’t the case in the 1980s. The next step is to account for these different allocation patterns when examining the impact of aid on growth and democracy.

    Further, there is growing evidence to suggest that aid outcomes differ by time period. Aid is associated with positive economic reform, democratization, and even growth in the post-1990 period but not earlier periods (Dunning 2004, Wright 2009, Bearce and Tirone 2010, Bermeo 2010b). This would suggest that as aid allocation patterns have changed, so too have the correlations between aid-growth and aid-democracy. If the bulk of our aid data is strategic aid from the cold war era, it shouldn’t be much of a surprise that it doesn’t spur growth or promote democracy.

    On the second point noted by Matthias, descriptive evidence from my own research indicates that increases in political contestation (but not political inclusiveness) in recipient countries during the 1990s were rewarded with more aid (Wright and Winters 2010). There is also evidence that anti-democratic behavior, such as pre-electoral violence or canceling elections, was punished with less aid during the 1990s (Hyde and Boulding 2008).

    None of this necessarily suggests that aid should be blindly given to dictators if at all, only that reality is more complex than the highly aggregated picture in your graph. Future research will hopefully think carefully about different types of aid and how to best measure democracy.

    Bearce and Tirone 2010. Journal of Politics

    Bermeo 2010a.

    Bermeo 2010b.

    Dietrich 2010. “The Politics of Health Aid: Why Corrupt Have an Incentive to Implement Aid Effectively.” World Development

    Dunning 2004. International Organization

    Hyde and Boulding 2008. “Political terror, election fraud, and foreign aid: When do donors withdraw aid to promote democracy?”

    Wright 2009. American Journal of Political Science

    Wright and Winters 2010. Annual Review of Political Science

    Posted November 8, 2010 at 4:35 pm | Permalink
  25. motudai wrote:

    @Michael Keizer
    2 may be interesting to consider with time biases. I’m serious: if you ask an addict whether he wants a cigarette now or no cigarette now so that he may or may not quit in the near future: the answer is more likely to be a cigarette now, no? The “incontrovertible” parts make your question worth thinking about more, but there are specific situations when yes from recipient doesn’t mean answer should be yes from donor.

    And re: 1, is your feeling that discarding emergency relief aid would considerably change the picture? I would guess not…

    Posted November 8, 2010 at 4:47 pm | Permalink
  26. @motudai

    Re addiction: does that mean that we unilaterally can decide to withhold cigarettes from the addict? Methinks no… and when we do try to do something similar the results are often catastrophic (e.g. the ‘war on drugs’ and the 1920s prohibition).

    Re emergency relief: it’s an interesting marginal case that can throw some light on the reasoning behind cutting off aid. If prof. Easterly maintains that we should also call off emergency relief, we can then interrogate the consequences and see whether they are acceptable. If he doesn’t, we need to either define how emergency relief is fundamentally different from long-term aid; or if it isn’t and it’s a question of gradation, where we draw the line and why at that specific place.

    Posted November 8, 2010 at 5:48 pm | Permalink
  27. Quicksilversurfer wrote:

    Bill,
    Thanks for the post. It was about time that someone with a high profile attempted to lance that boil. And from reading a lot of the comments, it looks like you hit a nerve! And many of the commenters clearly direct interest in the aid industry. Fascinating to see how they dissect and parse the argument to justify why aid should keep on flowing. Their justifications among many: (1) The poor (my view; if they did not exist they would have been invented as they provide justification for just about any action or inaction), (2) the different types of aid (thus dismissing any issue of fungibility which you address in your article) etc… It is going to be interesting to see how many types of arguments in support of continuing flows of aid can be brought up by the self-interested supporters of the aid industry… You opened up a very interesting thread that should reveal a lot about the industry.

    Posted November 8, 2010 at 9:09 pm | Permalink
  28. joe wrote:

    Is there any great advantage in having suffrage if you have nothing for which to vote? Is the person-without worse off in a democracy than the person-without in a dictatorship?

    Posted November 9, 2010 at 5:47 am | Permalink
  29. terence wrote:

    Thanks Joe and Sarah, and others for great comments – I’ve learnt a lot reading them, which isn’t often the case on blogs.

    Bill,

    In the NYRB article you wrote:

    A similar presumption informs Paul Collier’s book Wars, Guns, and Votes(2009), in which he goes from an empirical proposition that democracy in poor countries increases political violence (a conceivable conclusion, even though based on dubious criteria for defining democracy in this case) to a recommendation that donors oppose elections in the “Bottom Billion” in the aftermath of civil wars.

    Can you, or anyone else, provide evidence that Collier has ever argued that donors actively oppose elections rather than simply not place them at the top of their own list of priorities?

    This may sound like splitting hairs; however, given that you then go on to claim that –
    There may indeed be tradeoffs between democracy and other development goals, but why should outside aid donors be the ones who make these tradeoffs? – whether Collier is in favour of donor opposition or simply less donor promotion is central to your attack on him.

    If he’s not suggesting donors oppose elections then it can hardly be argued that he is arguing for donors, as opposed to countries themselves, deciding based on the tradeoffs involved.

    I’m no Collier booster but it strikes me that you’re twisting his arguments in a rather mendacious way.

    Still, I could be wrong. All that’s required is one quote…

    Posted November 9, 2010 at 4:06 pm | Permalink
  30. Barnabé wrote:

    The graph does not tell much actually. If dictatorship are poorer than free countries, it is not that surprising that they receive more aid. The issue is more: will a country suffer a reduction of received aid when they engage in a transition towards democracy? I’m afraid in some cases it happened. A more systematic analysis would tell us if it is a general pattern.

    Posted November 10, 2010 at 1:41 am | Permalink
  31. Check out the World Bank’s new data website, http://www.aidflows.org.

    Aidflows displays contributions by donor countries and contributions received by recipient countries.

    Posted November 10, 2010 at 8:56 am | Permalink

One Trackback

  1. [...] This post was mentioned on Twitter by OpenEye Group, Conduit Journal. Conduit Journal said: Donors seem to think Democracy is Only for Rich, Not for Poor http://bit.ly/dzkeEK [...]

  • About Aid Watch

    The Aid Watch blog is a project of New York University's Development Research Institute (DRI). This blog is principally written by William Easterly, author of "The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics" and "The White Man's Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good," and Professor of Economics at NYU. It is co-written by Laura Freschi and by occasional guest bloggers. Our work is based on the idea that more aid will reach the poor the more people are watching aid.

    "Conscience is the inner voice that warns us somebody may be looking." - H.L. Mencken

  • Recent Comments

  • Archives