Posted by: gppn | 13/11/2009

Aid Governance – An Indirect Assessment of Japanese Aid Effectiveness

Speaker: Takashi Yoshida and Shohei Kawase, University of Tokyo

Moderator: Wilson Tan (SIPA/LKYSPP) – Rapporteur: Kayo Matsushita (Tokyo University)

Problem

Even though large amount of money has been used for aid, the issues of poverty and development have not been resolved.

Analysis

Core reason of ineffectiveness in aid is the wrong allocation of aid. One way of allocating aid is through an indirect method of assessment. This way should be employed because direct assessment is not measurable due to

  • Individual contribution of donors which is not tangible,
  • the contribution of aid to the GDP growth rate in the direct assessment is not quantifiable.

Aid is given based on humanitarian consideration, political interests, etc. Allocation is made on the basis of:

  • Economic policies
  • Amount of aid recieved
  • Social capital
  • Institutional quality and capacity

Japan provides support to the developing countries in the form of Loans, Grants, Technical Assistance. Controlling for other factors (population, income, population, region), if the Japanese government gives aid with good policy, the result is positive.

There is certainly room for improvement in the decision making process.

Questions and Answers

What are the kinds of social capital that should be considered?

A chart should be formulated according to extent those factors that affect the budget of loan next year both negatively and positively.

What happens if a country receives no aid?

No data available.

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