The Impact of Aid Dynamics on State Effectiveness and Legitimacy

Abstract

Efforts to build state capacity in developing countries are often predicated on the assumption that external partners can help states improve their effectiveness and earn legitimacy by providing aid for public service provision. In a theory-building exercise, this paper advances a typology of aid dynamics in order to afford a granular picture of how development assistance for public service provision interacts with internal governance processes in recipient countries. Developing a conjunctural conceptualization of aid dynamics, we articulate how the impact of foreign aid depends not just on how much money is involved but also on whether donors or recipient governments are more influential in designing and implementing aid programs. We illustrate the descriptive utility of this typology by applying it to our empirical research on aid in the health and education sectors in Cambodia, Laos, and Uganda. We also probe causal expectations emerging from the typology, anticipating that aid for public service delivery has distinct and separate effects on state effectiveness and legitimacy depending on the precise aid conjuncture through which it is conceived and delivered. We conclude with suggestions for further research on the impact of foreign aid on state–society relations through the lens of public service delivery.

This is a preview of subscription content, access via your institution.

Notes

  1. 1.

    The World Bank’s twentieth flagship development report in 1997 was devoted to the role and effectiveness of the state and to the potential for aid to assist in building institutional capacity (World Bank 1997).

  2. 2.

    While the term “dynamics” can imply a temporal process, our work relies on the meaning of the term that references the interplay between different forces, thus capturing the inherently multi-faceted and interactive nature of aid. In prior work, we identify the nature of specific aid dynamics as a key independent variable determining the causal effects of externally assisted statebuilding and peacebuilding processes on the outcomes of state capacity and the depth of peace (Barma, Levy, and Piombo 2017). While the dimensions of aid dynamics remain intact conceptually, we have refined their labels in this paper.

  3. 3.

    Cammett and MacLean (2011: 294) similarly argue that the political and governance effects of non-state provision of public services through foreign aid are “contingent on the types of relationships between state and non-state providers.”

  4. 4.

    The nature of aid may certainly be characterized using other dimensions we have not identified here. Our empirical work leads us to believe that the three dimensions we have focused upon are the most significant and encompass within them many other dimensions of variation that have been identified in the literature.

  5. 5.

    According to the World Bank’s (n.d.) World Development Indicators (accessed February 16, 2019), all three of these cases fall in the upper quartile of aid-receiving states, based on average levels of net overseas development aid as a percentage of government expenditures from 2008 to 2017.

  6. 6.

    In building a typology, analysts “iterate between what was theorized a priori, what is known empirically, and what is learned from additional empirical study” (Bennett 2014: 221–222).

  7. 7.

    In our typology, the description of each aid dynamics type rests on the interaction of development partners and recipient governments. We label each type of aid dynamic from the donor perspective because our analytical focus lies in explaining when international assistance is effective at creating the outcomes it seeks.

  8. 8.

    We do not have empirical observations for all eight aid constellations from our current sample of countries and sectors. In particular, our empirical observations come from cases in which aid implementation is mostly government-managed. This could be because more heavily donor-managed implementation of aid in service delivery occurs in countries that have emerged more recently from conflict than the three countries in our study, which are at present quite far removed from conflict. This potential temporal aspect of the aid implementation dimension is an issue worth further study.

  9. 9.

    Barma (2016) takes a parallel conjunctural and endogenous analytical approach to understanding the outcomes of international peacebuilding interventions.

  10. 10.

    We use the term “state capacity” in this paper to encompass a general and multidimensional understanding of different elements of state strength. In Barma et al. (2017), for example, we advance a multidimensional understanding of what we term state coherence that comprises effectiveness, legitimacy, and authority. See, also, Hendrix (2010) and Kyle and Resnick (2019) on viewing state capacity as multidimensional.

  11. 11.

    See, also, Schmelzle and Stollenwerk (2018).

  12. 12.

    Our discussion here is limited to those constellations of aid dynamics where aid implementation is, on balance, more government-managed than donor-managed. This is both a conscious choice made in the interest of space as well as one made for reasons of practicality, since our empirical observations fall mainly on the more government-managed side of the aid implementation dimension.

References

  1. Baldwin K, Winters MS. How do different forms of foreign aid affect government legitimacy? evidence from an informational experiment in Uganda. 2020. (In this issue).

  2. Barma NH. The peacebuilding puzzle: political order in post-conflict states. Cambridge: Cambridge University Press; 2016.

  3. Barma NH, Huybens E, Viñuela L, editors. Institutions taking root: building state capacity in challenging contexts. Washington, DC: The World Bank; 2014.

    Google Scholar 

  4. Barma NH, Levy N, Piombo J. Disentangling aid dynamics in statebuilding and peacebuilding: a causal framework. Int PK. 2017;24(2):1–25.

    Google Scholar 

  5. Bennett A. Causal mechanisms and typological theories in the study of civil conflict. In: Checkel, editor. Transnational dynamics of civil war. Cambridge: Cambridge University Press; 2014. p. 205–30.

    Google Scholar 

  6. Blair R, Winters MS. Foreign aid, political perceptions, and citizenship in the developing world. 2020. (In this issue).

  7. Brass JN. Allies or adversaries? NGOs and the state in Africa. New York: Cambridge University Press; 2016.

    Book  Google Scholar 

  8. Brazys S. Aid and governance: negative returns. Eur J Dev Res. 2016;28(2):294–313.

    Article  Google Scholar 

  9. Cammett MC, MacLean LM. Introduction: the political consequences of non-state social welfare provision in the global south. St Com Int Dev. 2011;46(1):294–313.

    Google Scholar 

  10. Campbell S, DiGiuseppe M, Murdie A. International development NGOs and bureaucratic capacity: facilitator or destroyer? Polit Res Q. 2018;72(1):3–18.

    Article  Google Scholar 

  11. Collier D, LaPorte J, Seawright J. Putting typologies to work: concept formation, measurement, and analytic rigor. Polit Res Q. 2012;65(1):217–32.

    Article  Google Scholar 

  12. Cordella T, Dell’Ariccia G. Budget support versus project aid. IMF Working Paper WP/03/33. Washington, DC: International Monetary Fund; 2003.

  13. Dietrich S, Winters MS. Foreign aid and government legitimacy. J Exp Polit Sci. 2015;2:164–71.

    Article  Google Scholar 

  14. Dionne KY. Doomed interventions: the failure of global responses to AIDS in Africa. Cambridge: Cambridge University Press; 2018.

    Google Scholar 

  15. Dolan L. Rethinking foreign aid and legitimacy: view from aid recipients in Kenya. Unpublished manuscript. 2020. (In this issue).

  16. Doucouliagos H, Paldam M. The aid effectiveness literature: the sad results of 40 years of research. J Econ Surv. 2009;23(3):433–61.

    Article  Google Scholar 

  17. Elman C. Explanatory typologies in qualitative studies of international politics. Int Organ. 2005;59(2):293–326.

    Article  Google Scholar 

  18. Gehring K, Michaelowa K, Dreher A, Spörri F. Aid fragmentation and effectiveness: what do we really know? World Dev. 2017;99:320–34.

    Article  Google Scholar 

  19. George AL, Bennett A. Case studies and theory development in the social sciences. Cambridge: MIT Press; 2005.

    Google Scholar 

  20. Gerring J. Mere description. Br J Polit Sci. 2012;42:721–46.

    Article  Google Scholar 

  21. Gisselquist RM. Aid and institution-building in fragile states: what do we know? What can comparative analysis add? Ann Am Ac. 2014;656(1):6–21.

    Article  Google Scholar 

  22. Glennie J, Sumner A The $138.5 billion question: when does foreign aid work (and when doesn’t it)? CGD Policy Paper. 2014; 49

  23. Hendrix C. Measuring state capacity: theoretical and empirical implications for the study of civil conflict. J Peace Res. 2010;47(3):273–85.

    Article  Google Scholar 

  24. Hudson J, Mosley P. Aid volatility, policy and development. World Dev. 2008;36(10):2082–102.

    Article  Google Scholar 

  25. Knack S. Aid dependence and the quality of governance: cross-country empirical tests. South Econ J. 2001;68(2):310–29.

    Article  Google Scholar 

  26. Kyle J, Resnick D. Delivering more with less: subnational service provision in low capacity states. St Comp Int Dev. 2019;54:133–63.

    Article  Google Scholar 

  27. Levi M, Sacks A, Tyler T. Conceptualizing legitimacy, measuring legitimating beliefs. Am Behav Sci. 2009;53(3):354–75.

    Article  Google Scholar 

  28. Levy B. Working with the grain: integrating governance and growth in development strategies. New York: Oxford University Press; 2014.

    Book  Google Scholar 

  29. Marineau J. Aiding dependency: a cross-national analysis of foreign aid and tax compliance. 2020. (In this issue).

  30. Mcloughlin C. When does service delivery improve the legitimacy of a fragile or conflict-affected state? Governance. 2015;28(3):341–56.

    Article  Google Scholar 

  31. Menocal AR. State building for peace: a new paradigm for international engagement in post-conflict fragile states? Third World Q. 2011;32(10):1715–36.

    Article  Google Scholar 

  32. Montinola GR. When does aid conditionality work? St Comp Int Dev. 2010;45(3):358–82.

    Article  Google Scholar 

  33. Moore M. Revenues, state formation, and the quality of governance in developing countries. Int Polit Sci Rev. 2004;25:297–319.

    Article  Google Scholar 

  34. Ponniah K. Cambodia crackdown on corruption in schools scores low with exam cheats. Guardian, 2 September 2014. https://www.theguardian.com/global-development/2014/sep/02/cambodia-corruption-crackdown-exam-cheats

  35. Post AE, Bronsoler V, Salman L. Hybrid regimes for local public goods provision: a framework for analysis. Persp Polit. 2017;15(4):952–66.

    Article  Google Scholar 

  36. Pritchett L, Woolcock M, Andrews M. Looking like a state: techniques of persistent failure in state capability for implementation. J Dev Stud. 2013;49(1):1–18.

    Article  Google Scholar 

  37. Sacks A. Can donors and non-state actors undermine citizens’ legitimating beliefs? World Bank Policy Research Working Paper # 6158. Washington DC: The World Bank; 2012.

    Google Scholar 

  38. Schmelzle C, Stollenwerk E. Virtuous or vicious circle? Governance effectiveness and legitimacy in areas of limited statehood. J Int Statebuild. 2018;12(4):527–44.

    Article  Google Scholar 

  39. Teskey G. Capacity development and state building: issues, evidence and implications for DFID. London: Department for International Development; 2005.

  40. Tierney MJ, Nielson DL, Hawkins DG, Roberts JT, Findley MG, Powers RM, et al. More dollars than sense: refining our knowledge of development finance using AidData. World Dev. 2011;39(11):1891–906.

  41. Ward M, Penny A, Read T. Education reform in Uganda–1997 to 2004: reflections on policy, partnership, strategy and implementation. Educational Papers, Researching the Issues, Number 60. London: United Kingdom Department for International Development; 2006. http://www.eldis.org/vfile/upload/1/document/0708/DOC23569.pdf

  42. Weber M. Economy and society: an outline of interpretive sociology. Berkeley: University of California Press; 1978.

    Google Scholar 

  43. World Bank. World development report 1997: the state in a changing world. New York: Oxford University Press; 1997.

    Book  Google Scholar 

  44. World Bank. Project information document for the second global partnership for education (P149130). Report Number: PIDA10879; 2014.

  45. World Bank. World development indicators. Washington DC: The World Bank; (n.d.) URL: http://data.worldbank.org/data-catalog/world-development-indicator

  46. World Health Organization. Country accountability framework: assessment: Uganda. Dar-es-Salaam, Tanzania; 2012. http://www.who.int/classifications/Uganda_Scorecard_and_Roadmap.pdf p. 2

  47. World Health Organization. Cambodia–WHO country cooperation strategy 2016–2020. Geneva: World Health Organization; 2016.

    Google Scholar 

Download references

Author information

Affiliations

Authors

Corresponding author

Correspondence to Naazneen H. Barma.

Additional information

Publisher’s Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

This paper forms part of a broader research project led by the three co-authors and funded by a multi-year Minerva Research Initiative grant awarded in 2013. We wish to thank Robert Blair, Pierre Englebert, Martha Johnson, Melissa Lee, Claire Mcloughlin, Rachel Sigman, and Matthew Winters for their invaluable feedback on earlier iterations of this work. We are also indebted to those who shared their time and insights with us in Cambodia, Laos, and Uganda, and to two successive teams of undergraduate research fellows at Santa Clara University.

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

Barma, N.H., Levy, N. & Piombo, J. The Impact of Aid Dynamics on State Effectiveness and Legitimacy. St Comp Int Dev 55, 184–203 (2020). https://doi.org/10.1007/s12116-020-09304-7

Download citation

Keywords

  • Foreign aid
  • State effectiveness
  • Government legitimacy
  • Development assistance
  • Public service delivery