It is imperative to begin any discussion by examining the basic tenants that establish the foundation that much of the literature and debate on foreign aid revolves around. At the most basic level of discussion regarding the use of foreign aid, the main dispute that occurs stems from a question regarding the effectiveness of foreign aid. One would assume that such a simple question would have an easy and straightforward answer, but when it comes to interactions in the international system, nothing is ever simple. By examining several key pieces of literature that cover the effectiveness of foreign aid from various view points, it is possible to see how such a simple question is actually extremely complex. While no consensus exists on the overall
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Robert Cassen provides a more in-depth and technical approach to addressing this question in his book Does Aid Work. He sets out to investigate the how and why aid is used; with the intent of identifying if it has either a positive effect, negative effect, or no effect at all. He notes that it is important to study the effectiveness of aid for 2 main reasons. The first is to identify how worthwhile aid is, as it is diverting funds away from other uses within the donor nation. The second is to find evidence that can assist in aid management, which will help identify what works and what does not. These two reasons overlap, with both being able to make the practice of foreign aid more efficient in the long term. There are a few issues that Cassen faces in his efforts to examine if aid does indeed work. The first is that measuring the actual effect of aid is difficult due to dynamics both within the international system, as well as within both donor and recipient nations. Another issue that assessing aids impact is that the past is an imperfect guide to the future (Cassen 1994). This is partially due to most aid projects being implemented over five to ten year periods, and then taking several more years to gauge the effectiveness of the program. By the time it is possible to evaluate how successful an aid project was, donors may have shifted priorities away from the original project. The last issue that will be discussed is the implications of a learning process, which could imply that aid given today is likely to be more effective than aid given in the past due to successes and failures that have previously occurred. These issues make interpreting the effectiveness of foreign aid very difficult when comparing different projects and different recipients. Cassen suggests that even with the inherent difficulties in measuring the
Robert Cassen provides a more in-depth and technical approach to addressing this question in his book Does Aid Work. He sets out to investigate the how and why aid is used; with the intent of identifying if it has either a positive effect, negative effect, or no effect at all. He notes that it is important to study the effectiveness of aid for 2 main reasons. The first is to identify how worthwhile aid is, as it is diverting funds away from other uses within the donor nation. The second is to find evidence that can assist in aid management, which will help identify what works and what does not. These two reasons overlap, with both being able to make the practice of foreign aid more efficient in the long term. There are a few issues that Cassen faces in his efforts to examine if aid does indeed work. The first is that measuring the actual effect of aid is difficult due to dynamics both within the international system, as well as within both donor and recipient nations. Another issue that assessing aids impact is that the past is an imperfect guide to the future (Cassen 1994). This is partially due to most aid projects being implemented over five to ten year periods, and then taking several more years to gauge the effectiveness of the program. By the time it is possible to evaluate how successful an aid project was, donors may have shifted priorities away from the original project. The last issue that will be discussed is the implications of a learning process, which could imply that aid given today is likely to be more effective than aid given in the past due to successes and failures that have previously occurred. These issues make interpreting the effectiveness of foreign aid very difficult when comparing different projects and different recipients. Cassen suggests that even with the inherent difficulties in measuring the