Donor motives, public preferences and the allocation of UK foreign aid: a discrete choice experiment approach
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This paper develops a prescriptive model for the inter-country allocation of aid from the UK government. The model incorporates three broad motives for allocating aid: recipient need, donor interests and absorptive capacity (the ability of recipient countries to use aid effectively). To determine each motive’s relative importance, a discrete choice experiment (DCE) involving more than 1600 members of the UK general population was conducted. Absorptive capacity is the most important motive, and recipient need and donor interests are equally but much less important. Current UK aid allocations are compared with those prescribed by the model. Some countries, including China, India and Indonesia, would receive much more if aid were allocated according to the model; other countries, including Afghanistan, Ethiopia and Pakistan, would receive much less. Cluster analysis reveals that the political parties voted for by DCE participants at the 2015 general election are, inter alia, related to their aid preferences.
KeywordsForeign aid Discrete choice experiment (DCE) Cluster analysis UK
JEL ClassificationF35 H50 C90
The authors are very grateful to Trong Anh Trinh for research assistance and to an anonymous reviewer for very incisive and helpful comments and suggestions. The usual disclaimer applies.
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