Hi, there. In the previous video, we saw how the United Nations established development aid targets for the donor countries. And we examined the real motives behind the four countries that actually reached the norms in the 1970s that actually has stack to them ever since. We also highlighted the link between economic and governance structures, between foreign and domestic policy. Well now in this video we're going to look at whether development aid is effective. Particularly in respect to the efforts of the World Bank which encouraged better governance. We'll analyze this question at three levels, the evidence from econometric studies, the comparative study on efforts to encourage voice merchantability, and finally a local case study in water management and reforestation in West India. Now if there's any agreement in the literature, it's this, that aid is indeed most effective in countries with good governance and strong institution. And that making governance reform a condition from aid does not work. The logical conclusion is that donor aid strategy should concentrate on countries with good governance and strong institutions. But if everyone did this, it would mean abandoning the very poorest people living in weak and corrupt states, the very ones who need the help the most. Now this brings us to what is termed the Micro-Macro paradox. It was formulated by Paul Mosley in 1987. And this means that aid can often be seen to help local populations in very positive ways, even economically, but it doesn't show up in macroeconomics statistics. More aid did not seem to lead to more growth. It could also be that poor stagnant economies received more aid because they needed it, because that's what aid giving is supposed to be about. But it's equally likely that the econometric models used were incapable of capturing and disaggregating the variables involved in explaining economic growth. And finally, it could be because the growth data itself is rubbish. But you never hear anybody saying that. Meanwhile, many studies now shifted to local perspectives and they added to a substantial literature of microeconomic success that was beginning to pile up. But so too were the studies casting doubt on whether development aid had any effect on growth. Indeed, the literature has now expanded so far that there are models for analyzing the results of the models. And this new branch of literature suggest that in the long run, aid does indeed contribute to growth after all. Lots of aid, and very little growth. Well let's leave this range of inquiry and turn to the question of governance. Can aid agencies create the conditions for good governance? In 2007-2008, the UK department for international development published the results of the efforts of seven donor countries to promote voice and accountability. In a total of 67 development projects in which they had participated, the donor countries were Belgium, Denmark, Germany, Norway, Sweden, Switzerland, and the United Kingdom. Now they concluded that even at a micro level, the ability to improve voice and accountability were limited and relatively isolated, and they doubted whether any of the local successes would be scaled up. They also found no evidence that improved voice and accountability had aid any contribution to the alleviation of poverty or any other of the millenium development goals. So, why did these efforts fail? Well, they listed several problems. First, they made a misguided assumptions that voice and accountability was even wanted, and that more effective institutions would somehow become more accountable. Secondly, they proved unable to find a strategy or even an entry point in the complex interaction of power relations, formal and informal institutions. And third, there was a mistake in assumption that there was indeed one unified but unheard voice from the poor. And that at least among the poor, all voices would be equal but this proved very far from the case. And finally, they'd assumed there would be time to construct governments frameworks, without bringing the timetable for the implementation of the projects into difficulties. Well, these are pretty chilling conclusions. This is really what happens. Well David Mosse was employed as an anthropologist on a British development project in the hills of West India. The project had two aims, to improve water management in the villages, and to reverse the deforestation of the neighboring hills that had led to the water problem in the first place. Mosse was attached to the project as an anthropologist. But he turned his skills to analyze his own development workers. In 2005, he published the research in a fascinating and painfully honest book entitled Cultivating Development. Now how can I best convey its essence to you? Well analytically, Mosse divided his team into what he called sociologists and engineers. The sociologists wanted to make sure that everyone was involved in the decisions, so that the project would have local ownership, and the engineers wanted to dig irrigation canals and plant trees. And the local headman in the village wanted his work done first. So, the sociologist held their meetings, and meetings, and even more meetings, specially for women who didn't turn up at the other meetings. And the engineers waited and they wanted to start work. And the headman want everything to start with him, which was exactly what the sociologist did not want. And the villagers who had to keep living there long after everybody had left didn't want to upset the headman. So, after interminable blaze, what actually happened? Well, the headman got his work done first. The villagers got their water management and the reforestation was forgotten. And the governance of the village went on just as before. It's difficult to not being depressed when reading the literature on aid effectiveness. But even though academic literature is layered with resign cynicism toward foreign aid and foreign aid industry, it's difficult to not be impressed by the vision and the determination of those working to improve the lot of their fellow men. So thank you very much, Nicola, my daughter, for showing me your work with the special needs children in Kenya. And the wonderful people who are working with you.
