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Nicholas Kristof and Aid
May 20, 2011
I am a big admirer of Nick Kristof, of the passion and concern that animate his books and columns, and of the must-do-can-do spirit that they embody. But sometimes his soft heart gets ahead of the hard head, leading to misleading and intellectually insupportable advocacy of foreign aid. A good example is today’s column.
Kristof’s main thrust in today’s column is that randomized control trials (RCTs) are increasingly providing a good and effective way of making aid work. The old debate about whether aid is effective or not is sterile because we now have an intellectual apparatus for making better calls about how to target aid.
The RCT approach to development pioneered and propagated by Professors Abhijit Banerjee, Esther Duflo and Michael Kremer is indeed a very positive and significant development. But the key point is that this approach sheds light, under a limited set of circumstances, on whether certain policy interventions work. They do not—I repeat, do not—shed any light on whether aid per se works. The distinction is important, not intellectual nitpicking.
If de-worming is shown to work as an intervention, it can be implemented and financed domestically by governments, it can be done via foreign assistance, or some combination of the two. There are good reasons to believe that policy interventions implemented domestically are probably more desirable because of the benefits of country ownership and accountability. But there is absolutely no evidence to show aid-financed interventions are better or even effective. In short, RCTs might in principle provide a relatively narrow list of interventions that donors can choose to support, but they do not prove that the support itself is beneficial.
There is a larger sense in which Kristof’s invocation of RCTs to advocate aid could be misleading or mis-interpreted. Even if RCT-proven interventions provide some targets towards which modest amounts of foreign assistance could be directed, they shed no light at all about the aggregate effects of larger scale foreign assistance.
Consider the most pressing current case. What would be the effects of disbursing $1-1.5 billion of foreign aid to Pakistan? RCTs do not, and cannot, have anything to say on the matter—not only because of their narrow focus and applicability, and hence non-generalizability, but also because they cannot speak to macroeconomic effects. The larger developmental effects of aid may be good or bad but RCTs cannot help us distinguish them. We are still left to rely on other evidence—economic and historic—about the effects of aid in stunting institutional development, in creating aid-dependence, in entrenching the hold of the bad guys, and in making the export sector uncompetitive in a way that is detrimental to long run development. These broader effects remain stubbornly present and need to be addressed head on before any large-scale foreign assistance is contemplated.
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4 Responses to “Nicholas Kristof and Aid”
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May 21st, 2011 at 12:07 pm
professor submanian,
i hope you will forgive the arrogance of a non academic who’s own humanitarian involvement is limited to a couple of years in India and Nepal commenting on your article.
You state:
“What would be the effects of disbursing $1-1.5 billion of foreign aid to Pakistan?”
Since this comes to 8 dollars per Pakistani in my own inexpert opinion would be somewhere between extremely negligible to non-existant.
you state:
“need to be addressed head on before any large-scale foreign assistance is contemplated.”
what ‘large-scale’ foreign assistance’?
the United Nations sets what would in practical terms seem a very low bar of .7 % of national income…but in recent times only a couple of small Scandinavian nations have reached that level.
in sums large enough to be meaningful no nation is contemplating ‘large-scale foreign assistance’.
Also it is very confusing to the average citizen when bribes to elites and military governments or payoffs to powerful domestic lobbies are lumped together with real foreign aid.
bribes are bribes and academics should be honest enought to classify them as such.
May 21st, 2011 at 9:59 pm
I would like to share a personal story. Last year, as every year, we hosted a charity party with our kids and their friends. Each year, I give the children (ages 5-12) a choice of 3 charities that they can raise money for according to a theme. This year’s theme was \children around the world\. They then raffle prizes and offer the proceeds to the winner. The process is fantastic. They read a short description of each charity and discuss these in a group. Then they vote. Typically, they try to obtain quorum by building group consensus. Everyone participates and has a voice. This year, coincidentally, I selected UNICEF, De-Worm the World and Pennies for Peace (an arm of Morgenstern’s charity that builds schools in Afghanistan and Pakistan). I expected the kids to pick UNICEF for \brand\ recognition, or possibly De-worm the world because of the compelling statistics I offered of how far a penny goes in deworming. They surprisingly picked Morgenstern’s charity. When I asked them why, they articulated very clearly that they felt that education was a very important way to avoid wars, and that they were aware of a war in Afghanistan and problems with Pakistan. No PhDs. No RCTs. No RFPs. Just some kids, sitting around, talking and thinking. I find it fascinating. I hope you all do as well!
May 24th, 2011 at 4:00 pm
Thank you very much for your commentary. As an int’l development project evaluator, while RCTs are compelling, they also bring with them big ethical issues. For instance, if comparing a food aid intervention’s impact on nutritional status, do we really want to leave the ‘control group’ village that didn’t get food aid to starve?
Thanks, Jindra (jindra@cekanconsulting.com)
May 24th, 2011 at 4:19 pm
Arvind– RCTs definitely aren’t the silver bullet to inefficient aid. Indeed, warewolves have nothing on faded consultants and inefficient bureaucrats, so its surely likely there isn’t any silver bullet to be found. At the same time, I think you might go a little far in your critique.
Many RCTs have analyzed aid-financed projects and found that the projects worked. Unless you can demonstrate that absent aid all of those projects would have happened anyway, aid flowing rather than aid not flowing made a difference –it had an impact and the support was beneficial.
Again, i’m not sure they only tell us about uses for a ‘modest amount of foreign assistance.’ Aid-financed conditional cash transfers have been subject to numerous RCTs. Unconditional cash transfers have been subject to some. Both look pretty good across a range of countries and designs. Spend just a dollar a week for conditional or unconditional cash transfers for the 365 million Africans living on $1.25/day or a less and that’s $19 billion a year right there…
And the ‘stubborn’ presence of the negative impacts of aid through dependence and dutch disease surely needs a qualification, too –if RCTs don’t always give straightforward answers they still make the macro aid effectiveness literature look as messy as the plot of Pirates of the Carribbean…