ASTK15399U  COURSE: The Politics and Economic of Aid

Volume 2015/2016

Bachelorlevel: 10 ECTS

Masterlevel: 7,5 ECTS


Elective course - Specialization "International political economy"


Note: The schedule will be changed to block 4


Poverty and poor governance continue to stay in the large part of developing countries despite major aid efforts. Governments, academics and aid practitioners alike have introduced various views of aid and modalities to speed up development, but results have been mixed. Experts have also pointed out political, economic and institutional factors are key factors for development. These discussions contributed to important declarations on aid, such as the Millennium Development Goals (2000) and Paris Declaration (2005), which was a commitment of donors to change how aid is delivered. New(er) donors entered the politics of aid in recent years as well. The BRICs are co-signers of the Busan Outcome Document (2011), establishing a Global Partnership for Development Cooperation. Aid and development concerns are increasingly linked with other global concerns, such as economic decline, climate change, health epidemic, food and fuel crises and so on.


Against this background, the primary objective of this course is to introduce research on the political, economic and institutional aspects of development cooperation (aid) and aid effectiveness. This research comes from academic research as well as policy-oriented insitutions such as NGOs, think tanks and aid agencies. The course consists of 7 weeks with 2 hours x 2 of teaching each week. Guest lectures will be incorporated when possible. This course is designed to in part prepare for life in a global and culturally diverse world. The course is open to everyone but can be considered as an advance course for the IPE specialization.











Evolutions in Aid (1)

  • History of aid
  • Evolution of development paradigms & aid modalities
  • Governance agenda
  • Role of political regimes in aid effectiveness


Evolutions in Aid (2)

  • Rationale of the aid architecture since 2000
  • Shifting roles of actors


The aid effectiveness debate

  • Looking into the aid-growth nexus & political economy of aid


Economies in Development

  • Perspectives from the studies of International Political Economy


Research design workshop

  • Preparation for the written exam


Assessing debt relief and budget support

  • Effectiveness of debt relief and budget support
  • Challenges in evaluating aid modalities


Aid on environment

  • From Rio to Gleneagles
  • Patterns of environmental assistance
  • Issues of environmental aid - institutional cutoff, the theory of ecological modernisation


Guest lecture

  • TBC


Aid fragmentation

  • Definition
  • When it started; Why it is problematic; Why it started
  • How many is good?
  • Donor harmonisation?


Evaluating aid

  • Types of ‘evaluation’
  • What is evaluation?
  • Evaluation models
  • Program evaluation


Emerging donors

  • The changing environment
  • The “emerging donors” and concerns
  • Research on “emerging donors”
  • Cases: Four emerging donors in Cambodia, China in Africa
  • How should the West and recipients deal with the new reality?


Research design workshop

  • Peer discussion on exam topics



Learning Outcome

Learning Outcome

By the end of this course you should be able to:

  • Demonstrate a critical understanding of political, economic and institutional aspects of development cooperation (aid) and aid effectiveness

  • Demonstrate an understanding of the contexts with which policy makers have to deal

  • Demonstrate an understanding of the contrasting theoretical approaches used to analyse politics and economics of aid

  • Demonstrate an ability to support and value intercultural communication

  • Demonstrate an ability to discuss different perspectives by brining in own knowledge and experience

• Roger C. Riddell
Does Foreign Aid Really Work? New York: Oxford University Press, 2008 (536 pages)
• William Easterly
The White Man's Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill And So Little Good, Oxford: Oxford University Press, 2007 (400 pages)
• Paul Collier
The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It
New York: Oxford University Press, 2008 (224 pages)

Readings for individual lessons

1. Introduction

• Mavrotas, G. (2010). Introduction and Overview. In G. Mavrotas (Ed.), Foreign Aid for Development: Issues, challenges, and the new agenda (pp. 3-19). Oxford: Oxford Unviersity Press.
• Riddell, R. C. (2014). Does Foreign Aid Really Work? Background paper to keynote address to the Australasian Aid International Development Workshop, Canberra February 2014.

2. Evolutions in Aid (1)

• Birdsall, N. (2005). Seven Deadly Sins: Reflections on Donor Failings Center for Global Development (Working Paper Number 50).
• Engberg-Pedersen, L. (2014). Bringing Aid Management Closer to Reality: The Experience of Danish Bilateral Development Cooperation. Development Policy Review, 32(1), 113-131.
• Lancaster, C. (2000). Redesigning Foreign Aid. Foreign Affairs, 74(2000), 74-88.
• Ostrom, E., Gibson, C., Shivakumar, S., & Andersson, K. (2002). Aid, Incentives, and Sustainability: An institutional analysis of development cooperation Sida Studies in Evaluation 02/01. Stockholm: Swedish International Development Cooepration Agency,.
• World Bank. (1998). Assessing Aid. New York: Oxford University Press.

3. Evolutions in Aid (2)

• Andersen, O. M. (2000). Sector programme assistance. In F. Tarp (Ed.), Foreign Aid and Development: Lessons learnt and directions for the future (pp. 178-194). London and New York: Routledge.
• Grindle, M. S. (2004). Good Enough Governance: Poverty Reduction and Reform in Developing Countries. Governance: An International Journal of Policy, Administration, and Institutions, 17(4), 525-548.
• Molenaers, N., & Renard, R. (2008). Policy Dialogue under the New Aid Approach: Which role for medium-sized donors? Theoretical reflections and views from the field Discussion paper (2008.05). Antwerp: Institute of Development Policy and Management.
• Mosley, P., & Eeckhout, M. J. (2000). From project aid to programme assistance. In F. Tarp (Ed.), Foreign Aid and Development: Lessons learnt and directions for the future (pp. 131-153). London and New York: Routledge.

4. The aid effectiveness debate
• Burguignon, F., & Sundberg, M. (2007). Aid Effectiveness: Opening the Black Box. The American Economic Review, 97(2), 316-321.
• Doucouliagos, H., & Paldam, M. (2009). The aid effectiveness literature: The sad results of 40 years of research. Journal of Economic Surveys, 23(3), 433-461.
• Hansen, H., & Tarp, F. (2000). Aid effectiveness disputed Foreign Aid and Development: Lessons learnt and directions for the future (pp. 103-128). London and New York: Routledge.

5. Economies in development
• Frieden, J. A., Lake, D. A., & Broz, J. L. (2010). Economies in Development. In J. A. Frieden, D. A. Lake, & J. L. Broz (Eds.), International Political Economy: Perspectives on Global Power and Wealth (Fifth edition ed., pp. 443-446). New York: W. W. Norton & Company.
• Dollar, D. (2010). Globalization, Poverty, and Inequality since 1980. In J. A. Frieden, D. A. Lake, & J. L. Broz (Eds.), International Political Economy: Perspectives on Global Power and Wealth (Fifth ed., pp. 447-467). New York: W. W. Norton & Company.
• Acemoglu, D. (2010). Root Causes: A Historical Approach to Assessing the Role of Institutions in Economic Development. In J. A. Frieden, D. A. Lake, & J. L. Broz (Eds.), International Political Economy: Perspectives on Global Power and Wealth (Fifth ed., pp. 468-473). New York: W. W. Norton & Company.

6. Research design workshop

7. Assessing debt relief and budget support

• Caputo, E., Kemp, A. d., & Lawson, A. (2011). Assessing the impacts of budget support: Case studies in Mali, Tunisia and Zambia. In OECD-DAC (Ed.), Evaluation Insights (Vol. 2). Paris: OECD-DAC.
• Cassimon, D., & Campenhout, B. v. (2007). Aid Effectiveness, Debt Relief and Public Finance Response: Evidence from a Panel of HIPC Countries. REview of World Economics, 143(4), 742-763.
• Cordella, T., & Dell'Ariccia, G. (2007). Budget Support versus Project Aid: A Theoretical Appraisal. The Economic Journal, 117(523), 1160-1279.
• Haan, A. d., & Everest-Phillips, M. (2010). Can New Aid Modalities Handle Politics? Foreign Aid for Development: Issues, challanges, and the new agenda (pp. 197-221). Oxford: Oxford University Press.

8. Aid on environment

• Chen, L.-C. (2013). International aid for wildlife conservation and local sustainable livelihood: The case of Caohai wildlife protection area in China. In A. Mori (Ed.), Environmental Governance for Sustainable Development: East Asian perspectives (pp. 143-163). Tokyo: United Nations University.
• Hicks, R. L., Parks, B. C., Roberts, J. T., & Tierney, M. J. (2008). From Rio to Greneagles: Has Aid Been Greened? Greening Aid? Understanding the Environmental Impact of Development Assistance (pp. 1-19). Oxford: Oxford University Press.
• Hicks, R. L., Parks, B. C., Roberts, J. T., & Tierney, M. J. (2008). Billions for the Earth? Patterns of Environmental Assistance Greening Aid? Understanding the Environmental Impact of Development Assistance (pp. 20-53). Oxford: Oxford University Press.
• van den Berg, Rob. D. (2014). A global public goods perspective on environment and poverty. In J. I. Uitto (Ed.), Evaluating Environment in International Development (pp. 17-36). New York: Routledge.

9. Guest lecture

10. Aid fragmentation

• Anderson, E. (2012). Aid fragmentation and donor transaction costs. Economic Letters, 117(2012), 799-802.
• Frot, E., & Santiso, J. (2009). Crushed Aid: Fragmentation in Sectoral Aid. In SITE Stockholm Institute of Transition Economics (Ed.), SITE Working Paper (Vol. 6). Stockholm: Stockholm School of Economics.
• Kimura, H., Sawada, Y., & Mori, Y. (2007). Aid Proliferation and Economic Growth: A Cross-Country Analysis RIETI Discussion Paper Series (07-E-044): Research Institute of Economy, Trade & Industry.
• Knack, S., & Rahman, A. (2007). Donor fragmentation and bureaucratic quality in aid recipients. Journal of development economics, 83(2007), 176-197.
• Knack, S., & Smets, L. (2012). Aid Tying and Donor Fragmentation. World Development, 44(2013), 63-76.
• Schulpen, L., Loman, B., & Kinsbergen, S. (2011). Worse than expected? A comparative analysis of donor proliferation and aid fragmentation. Public Administration and Development, 31(2011), 321-339.

11. Evaluating aid

• Hansen, H. F. (2005). Choosing Evaluation Models: A Discussion on Evaluation Design. Evaluation, 11(4), 447-462.
• Hatry, H. P. (2013). Sorting the relationships among performance measurement, program evaluation, and performance management. In S. B. Nielsen & D. E. K. Hunter (Eds.), Performance management and evaluation: New Directions for Evaluation: Wiley Online.
• OECD. (2010). Better Aid: Evaluation in Development Agencies. Paris: OECD Publishing.

12. Emerging donors

• Brautigam, D. (2009). The Changing Face of Chinese Engagement in Africa The Dragon's Gift: The real story of China in Africa (pp. 1-21). Oxford: OUP.
• Carvalho, P. A. R., Kim, H.-s., & Potter, D. M. (2012). Aid to Africa from Japan, Korea and China: Ideology, Economic Interests, and Poverty Reduction. In H.-s. Kim & D. M. Potter (Eds.), Foreign Aid Competition in Northeast Asia. Sterling: Stylus Publishing.
• Kuik, C.-C. (2015). An Emerging 3rd Pillar in Asian Architecture? AIIB and Other China-led Initiatives. Asia Pacific Bulletin(March 26, 2015).
• Sato, J., Shiga, H., Kobayashi, T., & Kondoh, H. (2011). "Emerging Donors" from a Recipient Perspective: An Institutional Analysis of Foreign Aid in Cambodia. World Development, 39(12), 2091-2104.
• Watanabe, S. (2013). Donor's impact on China: How have major donors affected China's economic development and foreign aid policy? In J. Sato & Y. Shimomura (Eds.), The Rise of Asian Donors: Japan's impact on the evolution of emerging donors (pp. 87-113). Oxon: Routledge.

13. Research design workshop

14. Summary

In-class sessions will constitute a mixture of lectures, questions in lecture, discussions, student presentations in groups, pairs, plenary, polls and a workshop on research design.
7,5 ECTS
Type of assessment
Written examination
Marking scale
7-point grading scale
Censorship form
External censorship
Criteria for exam assesment
  • Grade 12 is given for an outstanding performance: the student lives up to the course's goal description in an independent and convincing manner with no or few and minor shortcomings
  • Grade 7 is given for a good performance: the student is confidently able to live up to the goal description, albeit with several shortcomings
  • Grade 02 is given for an adequate performance: the minimum acceptable performance in which the student is only able to live up to the goal description in an insecure and incomplete manner
  • Category
  • Hours
  • Class Instruction
  • 28
  • Course Preparation
  • 50
  • Preparation
  • 30
  • Exercises
  • 30
  • Exam Preparation
  • 20
  • Exam
  • 48
  • Total
  • 206