Substitutability: there is no substitute for learning this wonky concept if you want your project to succeed

The debate we had on the HDI brought up the seemingly drop-dead boring jargon “substitutability.” Surprise! This actually turns out to be a USEFUL concept. Consider two extremes in an everyday example.  For producing the output: “weird music that Bill listens to,” my iPod and my iPhone are perfect substitutes, so one is redundant for this purpose (forget about other purposes for now). For producing this same output, headphones and the iPod are NOT substitutes, they are BOTH required in the proportions: 1 set of headphones for every 1 iPod. So headphones and iPods have zero substitutability.

The exact opposite concept to substitutability is complementarity. Headphones and iPods are perfect complements (you can’t use one unit of either without one unit of the other). At the other extreme, iPods and iPhones have zero complementarity (you CAN use one without the other). This is just a description of technology as it is at the moment, that we might have to take as given (but maybe not, see below).

So why does this matter for, say, aid projects? Aid projects often run into trouble because one of the essential inputs (one of the “complements”) for the desired project output goes missing. So for example, the supply of clean water breaks down because one small part fails on the water pump at the well. None of the other components of the water supply are worth anything as long as the one part of the pump stays broken.

This is a common problem. Indeed, many disasters are caused by the failure of one (sometimes very small) complementary input, like the malfunctioning O-ring that caused the 1986 Challenger Shuttle explosion.{{1}}

Yet the idea of complementary inputs over-predicts the likelihood of disaster – there are so many different parts that could fail, any one of which would be fatal, you would expect MOST Shuttles to fail. Or you would expect a lot more airline disasters than actually happen, since airplanes are subject to the same problem.

So why are more airplanes not falling out of the sky? Airplane designers do not passively accept perfect complements, they add many backup (redundant) systems in case one part fails. In other words, they deal with a complementary (essential) input by creating a perfect substitute for it in case it fails. I follow the same principle when I carry around both my iPod and my iPhone, to avoid the catastrophe in which the battery runs out on one and I can’t listen to my eccentric music.

The lesson for aid projects is to also build in redundancy for the essential complementary inputs. Make sure you have a good backup system of repairmen and spare parts in case the water pump breaks down. This seemingly obvious advice is often not followed–for example in Malawi, between 30 and 40 percent of all waterpoints don’t work.

Oh, and a final word on the HDI debate. Under their old method, UNDP assumed that inputs into the index (like income and life expectancy) were perfect substitutes, so the amount you have of one doesn’t affect the usefulness of the other. This means that even if, say, Zimbabwe has almost no income, it still gets some credit if life expectancy rises.

The new HDI method instead treats these inputs as complements, meaning that a missing input (or an income level very close to zero) would produce the catastrophe of zero overall human development, just as an iPhone with no headphones nets us no music at all.

In our critiques of the HDI, Martin Ravallion, Laura Freschi, and I thought this was way too extreme. People are resourceful enough to “produce” human development even if their income is extremely low, when they will find back-up substitutes for “low material income.”

An important part of development in general is developing systems that provide back-up redundancies for any essential input into production. Development is also the growth of resourcefulness to work around bottlenecks of any one particular scarce input.

And so, class, today’s lesson is: Aid project managers should imitate this resourcefulness. Whenever you get stuck by complements, look for substitutes.

[[1]]In fact, Michael Kremer used this as an analogy for development failures in his classic paper “The O-ring Theory of Economic Development”[[1]]

QDDR: we can hardly contain our excitement

Aid Watch is as excited as everyone else to get a leaked, advance summary of the Quadrennial Development and Diplomacy Review, (HT Josh Rogin at Foreign Policy) which is a critical part of the US government process to set its priorities  on Development.

We love to seize occasions where we can be more positive to reward positive things happening, and not be our usual snarky selves.

Today is not one of those occasions.

Some highlights of the QDDR:

It would concern us that the QDDR is as aggressive as previous efforts we have complained about that want to merge Defense, Diplomacy, and Development. Fortunately this alarming militarization of development only covers actual or potential Failed States which according to the above Map in the QDDR is the entire developing world.

The review recognizes that US suffers from “insufficient internal coordination”of existing officials, offices and bureaus and so proposes to…create new officials, offices, and bureaus: Office of the Under Secretary for Civilian Security, Democracy, and Human Rights; a new Office of the Under Secretary for Economic Growth, Energy, and Environmental Affairs; a Special Coordinator for Sanctions and Illicit Finance; a Bureau of International Energy Affairs.

The QDDR is very persuasive that the US government needs to set priorities, that it should focus on development issues where the US government has a comparative advantage, which turn out to be…all development issues: sustainable economic growth, democracy and governance, food security, global health, climate change, and humanitarian assistance.

We could go on, but let's mercifully draw this discussion to a close, and move on to something more useful, like trying to think of an iPod playlist of songs most relevant to development.

Is aid sometimes for ruling party members only?

From our newly-published blog post for the New York Review of Books:

Foreign aid observers have often worried that Western aid to Africa is propping up autocratic regimes. Yet seldom has such a direct link from aid to political repression been demonstrated as in “Development without Freedom,” an extensively documented new report on Ethiopia by Human Rights Watch. Based on interviews with 200 people in 53 villages and cities throughout the country, the report concludes that the Ethiopian government, headed by prime minister Meles Zenawi, uses aid as a political weapon to discriminate against non-party members and punish dissenters, sending the population the draconian message that “survival depends on political loyalty to the state and the ruling party.”

The aid agencies say their own investigations fail to find widespread evidence of the misdeeds that the report documents—withholding government-provided seeds, fertilizer and microloans from non-party members, barring suspected critics of the regime from food for work programs, and denying emergency food aid to women, children and the elderly for refusal to join the ruling party. However, some aid officials admitted to Human Rights Watch (HRW) knowing about them:

As one western donor official said, “Every tool at [the government’s] disposal—fertilizer, loans, safety net—is being used to crush the opposition. We know this.”

Our post concludes by suggesting ways that the aid community might help Ethiopians rather than their rulers.

We of course welcome alternative views, including criticisms of the HRW report and HRW's operations in Ethiopia.

G20 summit's Seoul Development Consensus: please comment

UPDATE: OK I give up, I'll be the bad guy again (see end of post) I present selections of the text of the Seoul Development Consensus for Shared Growth without comment, inviting instead the readers to comment:

Be economic-growth oriented and consistent with the G20 Framework for Strong, Sustainable and Balanced Growth

Prioritize actions that tackle global or regional systemic issues

Differentiate, yet complement existing development efforts, avoiding duplication

Focus on feasible, practical and accountable measures to address clearly articulated problems

In close consultation with our developing country and LIC partners, as well as relevant international and regional organizations with development expertise, we have also identified nine areas, or “key pillars,” where we believe action and reform are most critical to ensure inclusive and sustainable economic growth and resilience in developing countries and LICs. These areas are: infrastructure, private investment and job creation, human resource development, trade, financial inclusion, growth with resilience, food security, domestic resource mobilization, and knowledge sharing. Creating optimal conditions for strong, sustainable and resilient economic growth in developing countries will require reform and transformation across each of these interlinked and mutually reinforcing key pillars.

UPDATE: OK I think I miscalculated, the Seoul Consensus is so completely free of substance that I couldn't get much comment (thanks to the valiant souls below who tried).

So it's my bitter lot in life to play the bad guy who says the obvious nasty things, like:

This summit set the lowest possible expectations on development, and then heroically failed to meet them.

Did it occur to any of the G20 sherpas that it would have been better to say, "we have nothing new on development" than to produce such vacuous babble then actually goes backward even from the dismally modest record of previous summits?

I guess the main puzzle is why the Koreans let themselves be insulted by having this Nothingness named after Seoul.

Why doesn't the other gender care about Gender?

Thirty years on, it is proving harder than many of us had hoped for gender and development policy and practice to move beyond familiar stereotypes – women as abject victims or splendid heroines, men as all-powerful perpetrators. Axioms abound: ‘women are the poorest of the poor’, ‘women give more priority to others – men invest more resources in themselves’, ‘women live in a more sustainable way than men and cause less climate change’, ‘women are the antidote to the financial crisis’.

Representations of men are limited and limiting. The ready association of the words “men” and “masculinity” with brute force, brash competitiveness and brazen prerogative makes those on the receiving end of the exercise of masculine power decisively female.

These complaints about Gender promoting gender stereotypes come from the journal Contestations, in an article by the always thought-provoking Andrea Cornwall and Emily Esplen.  They call for moving beyond stereotypes and actually involving Men in the cause of better lives for Women. They wonder why they have few male takers for their recommended actions:

Why ... do we see so few men actually taking up these actions – even the men around us who declare themselves sympathetic allies?

Along with lots of bad reasons that don't reflect well on men, it could also reflect a few men put off by a cause that, according to the authors, perpetrates the "all men are evil" stereotype.

Donors seem to think Democracy is Only for Rich, Not for Poor

The international aid system has a dirty secret. Despite much rhetoric to the contrary, the nations and organizations that donate and distribute aid do not care much about democracy and they still actively support dictators. The conventional narrative is that donors supported dictators only during the cold war and ever since have promoted democracy. This is wrong.

Mo Ibrahim said:

All Africans have a right to live in freedom and prosperity and to select their leaders through fair and democratic elections, and the time has come when Africans are no longer willing to accept lower standards of governance than those in the rest of the world.

He knows that recognition of democratic values eventually leads to their realization; lack of recognition continues the subjugation of the poor.

See my whole article at the New York Review of Books

Imagine potential aid recipients saying what THEY think

Twenty minutes outside the small town of Masindi, Uganda is a village called Kikuube…The local council member representing the village is none other than my Mum…I was surprised that she—as a village leader—had never heard of the MDGs. Yet she goes about her day fulfilling tasks meant to improve the welfare of her community; from educating her community about the use of bed nets, to regular home inspections enforcing sanitation codes, to empowering women with micro-loan programs. What does it say about the MDGs when the very people that are supposed to be beneficiaries don’t even know about them?

This quote comes from TMS (Teddy) Ruge, co-founder of Project Diaspora, an organization that involves Africans abroad in sustainable development initiatives in their home communities. His musings on his village leader Mum not knowing about the MDGs were inspired by this year’s United Nations MDG Week, a series of meetings and events in New York much more conducive to talking about all the good the West is doing for the Rest than hearing from the Rest.

(It also made us think about how the international aid orgs are now struggling to credibly include the voices of aid recipients—witness this cringe-inducing IMF video and website about how the IMF consulted with “civil society representatives” during their annual meetings. The carefully chosen quotes from the carefully chosen “representatives” in the video praised the IMF for its openness to dialogue with the ill-defined “civil society,” perhaps right after the IMF did some “capacity-building” on them.)

Teddy envisioned instead an event featuring just the voices of the potential aid recipients, a platform for people from his home village and others like it to share their experiences on getting by on $1 a day, and their successes in their own communities. Teddy first considered getting a TED license to build on their well-known brand, but decided to create his own model, which he is calling Villages in Action:

On Saturday, November 27, the microphone will be mounted stage center in this little quaint village. We welcome the world to join us in a frank discussion on the state of poor. We’ll discuss the MDGs and what our role is in achieving them by 2015 (and what we were already doing)...I want to challenge the notion that the sustainability of our communities depends on intervention from the West…

His idea to start public discussions about the development goals throughout villages in Africa is an intriguing one. He is looking for technical and financial support for this new project; find him here.

Eyes Wide Shut: Philanthropy Action on the "Rescheduled" Sachs vs. Clemens/Demombynes debate

Tim Ogden at Philanthropy Action issues a petition for the "rescheduled" (quotes in original) Sachs vs. Clemens/Demombynes debate on evaluating Millennium Villages, which was supposed to happen last Wednesday, to be indeed, well, rescheduled.

He asks for all of us to be watching whether this indeed happens. Aid Watch is always in favor of more Watching, so we support Tim's petition.

Reader exercise: please explain "aid fungibility" to our Secretary of State

UPDATE: OK I finally define fungibility (see end of post). It involves brothels.

 the United States said Friday that it planned increased aid for Pakistan’s military over the next five years.

Secretary of State Hillary Rodham Clinton made the announcement in Washington ...

In announcing the aid, Mrs. Clinton did not discuss the administration’s moves to stop financing certain elements in the Pakistani Army that have killed unarmed prisoners and civilians.

On Thursday, senior administration and Congressional officials said that the Obama administration planned to cut off funds to those units.

From today's NYT

T or F: Increasing aid to Pakistani military while you "stop financing certain elements" who kill civilians is equivalent to increasing aid to these same "certain elements."

UPDATE: OK, OK I can tell you guys really want me to define "aid fungibility". Here's the official definition given by the World Bank's Chief Economist in the 1950s:

It's when we think we're financing a power plant, and we're really financing a brothel.

Aid Fungibility is when the Donor gives the Government Aid for Good Thing A and refuses to fund Bad Thing B. The clever Government then reduces its own spending on Good Thing A one for one with the aid, so that total spending (Donor + Government) on Good Thing A is unchanged. The government uses its savings on A to spend more on Bad Thing B. So de facto (compared to the pre-aid situation)  the Donor really has no effect on A and only has the effect of increasing total spending on Bad Thing B.

Why the US “whole of government” approach to development is a black hole

UPDATE by Bill: unconscious experiment on Twitter of sexiness vs wonkiness, see end of post. Aid Watch has frequently panned the administration’s declared strategy of “elevating development” to be “on par” with diplomacy and defense. For one, this rhetoric obscures the actual—and continuing--disparity in magnitude, power and influence between the so-called “3Ds.” For another, it implies that the objectives of each “D” tend to be aligned.

Todd Moss, at the Center for Global Development, writes that the administration’s speechifying on this subject is increasingly “ringing embarrassingly hollow,” as USAID doesn’t control its own budget, and the State Department is effectively running both US aid efforts in Haiti and the president’s new food security initiative.

But rather than attributing USAID’s weakness to the usual turf wars and inter-agency power grabs, Moss suggests another explanation:

What if the real problem is that the much-vaunted “whole-of-government” approach is fundamentally unworkable in the United States?

The idea behind whole-of-government seems sensible enough: lots of federal agencies have skills and resources and experience that can be brought to bear on complex problems. If we can get everyone in the same room and all in the same boat, then the USG effort can be greater than just lots of agencies all running around doing their own thing, right? This seems especially attractive in development policy, where the United States may be involved in helping foreign countries improve health, education, agriculture, transportation, democracy, security, financial regulation, and loads more. If we want to help entrepreneurs in Liberia, why not bring in USAID, the Treasury, the Commerce Department, the US Trade Representative, and the Small Business Administration? If we’re fighting HIV/AIDS in Uganda, let’s use the expertise of HHS, CDC, NIH, and the FDA, right? We’ve now got at least 26 agencies involved in foreign aid of one kind or another. But the room is starting to look a bit crowded now....

But in the United States—with its sprawling federal structure and huge agency staffs and budget—just getting everyone around one table is perhaps too much to ask. The interagency process in any country is a strain…[T]he process can become convoluted and bogged down when the scale is out of whack. Simply put: when you have too many people at the table, nothing gets done.

Read the whole post here.

UPDATE: 11:30 am Bill unconsciously ran an experiment on Twitter: (1) he posted a link to this blog on Twitter, and (2) he asked Twitter what was happening on Facebook such that he started receiving a bunch of messages from uncl*d l*dies saying "Hello :)" At this point the responses to (2) are outnumbering those to (1) by a 3:1 ratio. Please comment.

What Hillary’s cookstoves need to succeed

This post was written by Alanna Shaikh. Alanna is a global health professional who blogs at UN Dispatch and Blood and Milk. Yesterday, Hillary Clinton announced a new $60 million initiative to help 100 million households adopt clean and efficient cookstoves and fuels by 2020. The Global Alliance for Clean Cookstoves is a public-private partnership that includes the US State Department, the UN Foundation, the World Food Program, Royal Dutch Shell, the World Health Organization, and the US Environmental Protection Agency, among others.

Secretary Clinton, who made the announcement on the opening day of the annual Clinton Global Initiative meeting, made a good case for the importance of cookstoves in the lives of women and families. She framed it as a global health issue:

Exposure to smoke from traditional stoves and open fires – the primary means of cooking and heating for 3 billion people in developing countries – causes almost 2 million deaths annually, with women and young children affected most.  That is a life lost every 16 seconds.

But here’s the thing. Improved cookstoves aren’t a new idea. They’ve been kicking around international development circles since the 1940s. The Magan Chula stove, for example, was introduced in India in 1947. Never caught on before. Why would this effort be different? Why would it work this time?

The major flaw in previous cookstove efforts was focusing too much on good design from a designer’s perspective, and not enough from a user perspective. The improved cookstoves were technologically sophisticated and environmentally friendly. But they weren't comfortable for the women cooking on them, and they required changes in cooking methods, some of which made the food taste different.

In the kind of patriarchal societies that keep women tied to stoves and kitchen responsibilities, women don't have a lot of autonomy for decision-making, especially not about major household issues like a new stove. Many of the benefits of better cookstoves don’t directly impact the families who use them. Decreasing the environmental impact of a stove has no obvious effect on its owner. And indoor air pollution isn’t an obvious problem to the people who live with it – they don’t necessarily connect their illnesses with the stove that causes them, and when everyone lives the same way, there is no comparison to demonstrate the link.

Most importantly, using a new kind of stove means cooking differently. That’s a huge lifestyle change. It’s hard for the women who are doing the cooking, and it’s hard on their husbands and families, who may not like the new kind of food that results.

If this new effort is going to avoid the mistakes of its predecessors, it needs to do a few vital things:

• It needs to get as much input as possible from the people who will actually use the stoves. The stoves will need to be as much like existing stoves as possible, to minimize the change in cooking style required to use them. In particular, women need to be able to cook traditional foods that are appealing to their families. Listening to the women who’ll cook on them is the best way to do that.
• It needs to produce affordable stoves and consistently distribute them. Price is a big barrier to use of better cookstoves, since the benefits aren’t immediately obvious. The stoves need to be cheap enough that families can buy them with a minimum of savings or debt. Since they won’t last forever, there needs to be a steady supply of available improved stoves. That means building a structure for production and distribution, not some kind of one-off stove airlift.
• Finally, it will need to market the stoves intensely. Since the benefits to getting a new stove are obvious, and the problems aren’t, they’ll need to really sell these stoves. Women, and their families, will need to be convinced of the benefits. That will require a lot more than a dry brochure or an earnest slogan.  It will need actual ads, with an advertising strategy behind them.

Heated debate with John McArthur on MDGs and accountability

In 2000, nearly every country in the world made a promise to achieve a set of eight goals, including poverty reduction, women’s empowerment and universal primary education by 2015. How far have we gotten? Host Michel Martin speaks with two opposing voices about the progress made this far: John McArthur, CEO of Millennium Promise, and William Easterly, professor of economics at New York University.

Listen to the interview on NPR's Tell Me More. Once in the media player, the segment is called "UN Convenes to Assess Global Progress"- it's 12 minutes long.

The Millennium Development Goal that really does work has been forgotten

UPDATE 12 noon: this  is a dueling oped with Sachs on ft.com, debate has moved on and even some agreement (see end of post) from a column in the on-line Financial Times today ; for ungated access and a picture of the handsome author go here. The Millennium Development Goals tragically misused the world’s goodwill to support failed official aid approaches to global poverty and gave virtually no support to proven approaches. Economists such as Jeffrey Sachs might argue that the system can be improved by ditching bilateral aid and moving towards a “multi-donor” approach modelled on the Global Fund to Fight Aids, Tuberculosis and Malaria. But current experience and history both speak loudly that the only real engine of growth out of poverty is private business, and there is no evidence that aid fuels such growth.

Of the eight goals, only the eighth faintly recognises private business, through its call for a “non-discriminatory trading system”. This anodyne language refers to the scandal of rich countries perpetuating barriers that favour a tiny number of their businesses at the expense of impoverished millions elsewhere. Yet the trade MDG received virtually no attention from the wider campaign, has seen no action, and even its failure has received virtually no attention in the current MDG summit hoopla.

This is all the more misguided because trade-fuelled growth not only decreases poverty, but also indirectly helps all the other MDGs. Yet in the US alone, the violations of the trade goal are legion. US consumers have long paid about twice the world price for sugar because of import quotas protecting about 9,000 domestic sugar producers. The European Union is similarly guilty.

Equally egregious subsidies are handed out to US cotton producers, which flood the world market, depressing export prices. These hit the lowest-cost cotton producers in the global economy, which also happen to be some of the poorest nations on earth: Mali, Burkina Faso and Chad.

According to an Oxfam study, eliminating US cotton subsidies would “improve the welfare of over one million West African households – 10 million people – by increasing their incomes from cotton by 8 to 20 per cent”.

Brahima Outtara, a small cotton farmer in Logokourani, Burkina Faso, described the status quo to the aid agency a few years ago: “Cotton prices are too low to keep our children in school, or to buy food and pay for health.”

To be fair, the US government has occasionally tried to promote trade with poor countries, such as under the African Growth and Opportunity Act, a bipartisan effort over the last three presidents to admit African exports duty free. Sadly, however, even this demonstrates the indifference of US trade policy towards the poor.

The biggest success story was textile exports from Madagascar to the US – but the US kicked Madagascar out of the AGOA at Christmas 2009. The excuse for this tragic debacle was that Madagascar was failing to make progress on democracy; an odd excuse given the continued AGOA eligibility of Cameroon, where the dictator Paul Biya has been in power for 28 violent years. Angola, Chad and even the Democratic Republic of the Congo are also still in. The Madagascan textile industry, meanwhile, has collapsed.

In spite of all this, the great advocacy campaign for the millennium goals still ignores private business growth from trade, with a few occasional exceptions such as Oxfam. The burst of advocacy in 2005 surrounding the Group of Eight summit and the Live 8 concerts scored a success on the G8 increasing aid, but nothing on trade.

The UN has continuously engaged US private business on virtually every poverty-reducing MDG except the one on trade that would reduce poverty-increasing subsidies to US private business. And while the UN will hold a “private sector forum” on September 22 as part of the MDG summit, the website for this forum makes no mention of rich country trade protection.

The US government, for its part, announced recently its “strategy to meet the millennium development goals”. The proportion of this report devoted to the US government’s own subsidies, quotas and tariffs affecting the poor is: zero. News coverage reflects all this – using Google News to search among thousands of articles on the millennium goals over the past week, the number that mention, say, “cotton subsidies” or “sugar quotas” is so far: zero.

It is already clear that the goals will not be met by their target date of 2015. One can already predict that the ruckus accompanying this failure will be loud about aid, but mostly silent about trade. It will also be loud about the failure of state actions to promote development, but mostly silent about the lost opportunities to allow poor countries’ efficient private businesspeople to lift themselves out of poverty

UPDATE: this was a dueling piece with an oped by Sachs today on FT.com.

One of us also got a prestigious slot in the print edition of FT :>)

Surprising new agreement with Sachs, where he says:

{Bilateral aid doesn't work because it's} "largely unaccountable," "programmes are scattered among many small efforts," {and it creates mainly an} "endless spectacle of visiting dignitaries from donor countries."

Continuing disagreement with Sachs when he says:

The most exciting example {of success} is the Global Fund to Fight Aids, TB and Malaria. ...while a decade ago all three diseases were running out of control, now all are being reined in with millions of lives saved.

Jeff, could you clarify a bit what you mean saying that AIDS is "being reined in" when for every 100 people added to AIDS treatment, 250 people are newly infected with HIV?

IAD on A-i-d

This post is by Claudia Williamson, a post-doctoral fellow at DRI. In The Samaritan’s Dilemma: The Political Economy of Development Aid, Elinor Ostrom and other members of the Workshop in Political Theory and Policy Analysis at Indiana University apply Ostrom’s Nobel Prize-winning Institutional Analysis and Development (IAD) theoretical framework to development aid, specifically examining Sweden’s development agency, SIDA.

The IAD framework begins by analyzing the local context governing individual decision-making and scales up this analysis to include all types of rules that provide various incentive structures. This model presents the process of development as a series of collective action problems, analyzing the incentives for the provision of public goods and managing common pool resources.

Applying IAD to aid means that donors must first consider why there are development failures to begin with before they can accurately access whether intervention is an appropriate solution. This means investigating the underlying institutional arrangements structuring the incentives that produce collective action failures. If donors do not address these fundamental institutional failures, then any aid program is unlikely to be sustainable. Most donors pay lip service to these insights, but Ostrom and her colleagues find that their concern for the problems they entail is more rhetoric than reality.

The IAD framework views aid as a nested game, not a chain of delivery, between a variety of actors across different countries – including donor and recipient governments, contractors, civil society, NGOs, etc. These interrelationships create the incentive structure that will ultimately determine the likelihood of success from foreign intervention; therefore, the sustainability of a project and the achievement of long run development goals depends on the complex structure of incentives faced by all actors involved.

Given how complicated of a task this can become - e.g., dealing with the presence of multiple donors, special interest groups, the addition of new rules introduced by donors, and the possibility of corruption- it’s no wonder that donors may not be able to achieve their stated ends. In fact, donors often face perverse incentives that hinder sustainability and project success.

The title 'The Samaritan’s Dilemma’ stems from an article by James Buchanan (more on which here), another Nobel Laureate. Buchanan explains how donors' willingness to be charitable incentivizes recipients to alter their behavior in counterproductive ways. Recipients may, for example, reduce the amount of resources they themselves devote to the problem at hand. The original problem worsens and donors feel even more compelled to continue support, establishing a cycle of interventionism and reducing the chances of sustainability.

Ostrom’s approach to understanding development is to shift our focus towards the underlying incentives surrounding collection action problems. The traditional solution to such problems is central planning and government regulation, including the use of foreign aid. Ostrom argues, however, that expanding centralized bureaucracies is often counterproductive and may create additional unintended consequences. Instead, we should focus on individuals at the local level who are better equipped to develop solutions that are responsive to the complex local conditions generating these problems in the first place.

Wishful thinking on Pakistan

From last weekend’s New York Times:

As the Obama administration continues to add to the aid package for flood-stricken Pakistan — already the largest humanitarian response from any single country — officials acknowledge that they are seeking to use the efforts to burnish the United States’ dismal image there.…

American officials say they are trying to rekindle the same good will generated five years ago when the United States military played a major role in responding to an earthquake in Kashmir in 2005 that killed 75,000 people.

…But American officials warn that the glow from the earthquake assistance faded quickly without more enduring development programs.

“LeFever [the senior US officer in Pakistan] clearly understands the P.R. value of flood assistance, but he also knows that absent other high-profile public diplomacy efforts, the half-life of any improvement to Pakistani impressions of the U.S. will be short,” said John K. Wood, a retired Army colonel….

This article raises several questions related to recent Aid Watch blog posts. First, has anyone quoted in the article examined the evidence for or against the hypothesis that giving disaster relief will improve the US’s image in Pakistan? As we blogged recently, there is startlingly little evidence at all on whether aid can “win hearts and minds,” but one of the few studies that exists looked specifically at the 2005 Kashmir earthquake. It found that even though US relief efforts were effective from a humanitarian perspective, they had no lasting impact on Pakistani perceptions.

Second, the Army official quoted above warns that flood assistance from the US may not be enough to create lasting change. Maybe he read the studies (or our blog)? But from which studies did he get his evidence that  “high-profile public diplomacy efforts” have a huge payoff for making Pakistanis love us?

Third, could the love affair between US aid and Pakistan be suffering because Pakistan remembers that US aid jilted them several previous times? (See great graph from CGD.) And because the aid to Pakistan was driven by our own strategic interests?

Now this may sound hopelessly naïve, but here are some reasons the American government should be providing humanitarian assistance to Pakistan: This is an unprecedented disaster causing tremendous suffering and disruption for millions of Pakistani people. The ongoing floods that have submerged one-fifth of Pakistan under water have killed 1,500 people, destroyed crops and livestock, and have put as many as 6 million people at risk of dying from water-borne diseases in “a second wave of deaths” now predicted by UN officials.

If ever there was a time for US aid to demonstrate that it is NOT always and everywhere ONLY about US strategic interests, this would be a good time. And because it’s the right thing to do.

The Lives of Others

UPDATE: contrasting negative images offered by commentators on Twitter (see end of post) My Ghanaian friends often tell me that if you want to understand Ghanaians at all, you have to understand how religious are most Ghanaians. I believed them of course, but it didn’t really become vivid until I attended the most amazing church service this morning. I am not saying this out of any religious motives, just to point out another side of Ghanaians that outsiders seldom see or appreciate.

The service was at an Anglican church in Bolgatanga (I am myself an Anglican at a fairly tepid level). The Anglicans in in the US (where we’re called Episcopalians) are a pretty sedate denomination, associated with rich, formal, well-dressed, stuffy older people. So imagine an Anglican service with music including a drum-set, Ghanaian drums, a talented organist and a vocalist, dancing, and a congregation made up of all ages (also well-dressed in indigenous clothing). A drum-set would be as out of place at an American Episcopalian service as a vuvuzuela, but the Ghanaian Anglicans were clearly much more into the service than their American counterparts.

Exactly what point am I trying to make in my current travel-addled state with little time to write this? (Insert obligatory academic references to some random research findings on religion and development when I get more time.)

I think it’s something about how to understand people’s behavior, you need to understand how they see themselves. A good guess is that the people in the congregation this morning, in one of the poorest regions of Ghana, do NOT see themselves primarily as “poor” or “developing”, they see themselves as Christians. Another guess is that similar feelings about religious faith would apply to other Ghanaians in other religious services, like Muslims, Catholics, traditional religions, etc.)

Perhaps this fits into the recurring Aid Watch theme about humanizing aid recipients, how poor people have a life, and may not even see themselves as poor at all, and so may according to some other perspective NOT be poor. This is not to deny the material hardships of people around Bolgatanga; in fact, I talked to the bishop afterwards about really bad stuff like malaria and human trafficking in teenage girls. But not all the comparisons with rich Americans go one way. Just daring to speak for my fellow Episcopalians, Ghanaian Anglicans have something that American Episcopalians could envy and learn a lot from.

UPDATE: got this comment on Twitter:

@auerswald Noticed that too. RT @JaneReitsma: The absolute opposite of @bill_easterly's post today - "#Africa’s unsung heroines" http://econ.st/ce525h

The Economist article cited is a description of a few women in Burundi, whose husbands are depicted as follows:

As for the husbands... Many of those who stay are drunks with syphilis. Women are forbidden to inherit land. They are often beaten and raped.

I'm not sure how a random example from Burundi is the "opposite" of the post above on personally observing one congregation in Bolgatanga, since I was not trying to establish the definitive portrait of "the typical African", which would be a ludicrous enterprise. I certainly would not deny the very real existence of abusive husbands and victimized women, but it does bother me that there are a lot more of the extreme negative anecodotes  in the Western media covering Africa than any positive anecdotes.

Separating the wax from the gold: social accountability in Ethiopia

This post was written by Helen Epstein, author of The Invisible Cure: Why We Are Losing the Fight Against AIDS. I was heartened to see that Shanta Devarajan, the World Bank’s Chief Economist for Africa, blogged about my article Cruel Ethiopia in the New York Review of Books.

The article—and Dr. Devarajan’s blog—deal with the extremely delicate and complex relationship between economic and social development and human rights. He and I agree that there is no simple formula to explain this relationship. However, in order to help the poorest people realize their basic right to development, and to ensure our aid dollars are spent as effectively as possible, we need to try to understand it. That’s why I was troubled by this section of Dr. Devarajan’s blog.

Ethiopia has done well in reducing poverty and child mortality, and increasing primary completion rates because their system of delivering basic services has various elements of this accountability built in.  Local districts receive resources based on clear, data-driven formulae that can be independently verified (by third-party civil society groups). The allocation of these resources within the district is decided in community meetings, with the final budget posted on a central bulletin board for the community to see.

If only this were true.

Dr. Devarajan is describing the “social accountability” component of a World Bank-Ethiopia program to support health, education and other social services. In general, social accountability programs train community groups or NGOs to carry out surveys of local government budgets, monitor the quality of services such as clinics and schools, and publicize problems such as corruption or absenteeism among teachers and health workers. In an ideal world, these groups then work constructively and openly with local government officials to find feasible solutions to these problems.

Social accountability programs can be an extremely powerful mechanism for holding local authorities to account, building local democratic mechanisms, improving education and access to safe water, and even saving lives. A World Bank-sponsored evaluation of two such programs in Uganda found that one increased the amount of public education funding that actually reached schools nearly four-fold, and another increased the survival of children under five by one third, with no additional direct funding for health services.

When I first visited Ethiopia in late 2008, I was eager to see how the social accountability program that Dr. Devarajan refers to was working. But during the four visits I made to the country over the next 12 months, World Bank and other officials repeatedly told me the program had been only a small scale pilot program, that it had ended in 2008, and that an expanded program was planned, but would not start until after the elections in May 2010. So I am not sure what program Dr. Devarajan visited. Even in the pilot projects, the monitoring was not, by and large, done by “third party civil society” groups. Nearly all the NGOs were ruling party affiliates.

There is no automatic relationship between development and human rights. But it’s worth asking whether development can ever occur in a society where a government is deaf to its people. It seems to me that development takes root in societies that listen, either because the people truly have power, as in a democracy, or because the government is afraid of what would happen if they demanded it.

A spoonful of transparency: good but no cure-all

The New York Times ran a story last week about a five-year-old Indian law that reinforces the right—and sets in place the process—for individuals to request government-held information. Ms. Chanchala Devi, for example, applied for a government grant she had heard was available to help poor people like her build their own houses. After four years of fruitless waiting, she used India’s Right-to-Know law to request a list of people who had received the money while she had not. Within days, the story reported, Ms. Devi’s own funding came through. The story continues:

…it has now become clear that India’s 1.2 billion citizens have been newly empowered by the far-reaching law granting them the right to demand almost any information from the government. The law is backed by stiff fines for bureaucrats who withhold information, a penalty that appears to be ensuring speedy compliance.

Great news. But while the law has empowered individuals (over 2 million of them in the first 3 years of the law’s existence) to seek redress for their grievances, the article also cites critics who complain that the law has not had hoped-for system-wide effects on corruption, and that it acts as a “pressure valve” without posing a serious challenge to the system.

Joseph Stiglitz, among others, has convincingly argued that information gathered and produced by government officials rightly belongs to the public; that people need such information to participate meaningfully in democracy; and beyond these arguments, that openness has an intrinsic value. A 2008 JPAL study gives Stiglitz an empirical assist: giving urban poor people access to published “report cards” about local politicians’ performance and spending influenced those voters to elect incumbents based on issues (rather than caste or religion, for example).

Possibly the most-repeated success story told about information disclosure comes from Uganda, where World Bank researchers found in 1995 that only 13 percent of national government transfers to local schools actually reached the schools. After the Ugandan government began publishing in the newspaper how much money was supposed to go to each school, the proportion of funds “leaking” out of the system decreased dramatically. Four years later, 90 percent of that money was reaching the schools, and the newspaper information campaign was given credit for the change.

Like most simple stories in development, this one is actually not so simple. A paper by Paul Hubbard at the Center for Global Development objects that the plummeting proportion of funds going astray has to be put in the context of comprehensive fiscal and education reforms going on in Uganda at the time. Another study found that information disclosure efforts like the famous newspaper campaign were only effective in communities “that were literate and assertive enough to act when abuse was revealed.” Hubbard observes: “transparency by itself is insufficient if there is no opportunity for collective action.”

Which brings us back to India, where the Right-to-Know law is helping Chanchala Devi—and hundreds of thousands like her—to get what she is entitled to from her government. Why should we want it to be a cure-all for India’s corruption ills? What drives us to search for panaceas and silver bullets? Any expectation that this law alone will tackle an entrenched and corrupt bureaucracy is probably way too much for it to bear.

Troubled Water

A new Frontline segment investigates one of its own stories from 2005, a report on a child-powered merry-go-round that acts as a water pump. At the time, the PlayPump seemed an innovative, clever way to increase the clean water supply in African villages.

After FRONTLINE/World first aired the story in 2005, major donors in the United States -- and the U.S. government itself -- launched a multimillion-dollar campaign to install the device in thousands of African schools and villages. Now, correspondent Amy Costello investigates what happened to those communities, as the promise of the PlayPump fell short and the device's biggest American boosters began to back away from a technology they had once championed.

We blogged about PlayPumps in February, citing a report by the charity Wateraid which decried the pumps’ “reliance on child labour” and a commentary in the Guardian which calculated that children would have to “play” for 27 hours every day to meet PlayPumps’ stated targets of providing 2,500 people per pump with their daily water needs.

The Frontline correspondent visits communities where school children have tired of  the merry-go-rounds and women have to turn the cumbersome pumps by hand, and communities where PlayPumps have broken, leaving villages without a clean water source for up to 17 months while  no one responds to calls for maintenance. She reports on a never-released Mozambique government document that discloses a long list of problems with operation, repair, and maintenance of the device. She talks to a Save the Children official who says that only 13 out of 42 PlayPumps they helped install in Mozambique are working, but can’t say why.

According to Frontline, no one from the the Case Foundation (one of the major funders) or PlayPumps International would agree to an interview.

This is the preview; you can see the whole segment here.

UPDATE 12:20 pm: A few commenters and people on Twitter remind us that while the Case Foundation declined to be interviewed for this program, they did write a thoughtful blog post about their experience:

[T]here really is only one appropriate response when things aren't humming along as planned, and it is the same response Bill Gates offered, "So, what do we do next?" Because just like in business ventures, personal undertakings and public sector initiatives, things often go wrong...

It sometimes feels like philanthropic efforts are held to a different standard than in the private or public sectors. All too often there is less tolerance for mistakes, which leads many organizations to become risk-adverse. And when mistakes are made, the tendency is to sweep them under the carpet - thus depriving the sector of important lessons learned. But in reality, the very nature of innovation requires that we try new things and take risks.

FT: Celebrities urge G8 to make new unkept promises to keep previous unkept promises

Oh how we wish it would be otherwise! What will it take? Alan Beattie writes on the G8 in the FT:

It stretches the most elastic mind to envisage the collective wrath of Scarlett Johansson, Annie Lennox, Bill Nighy, Kristin Davis and Her Majesty Queen Rania of Jordan, but it descended on the heads of the Group of Eight this weekend.

The obsolescence of the G8 has long been discussed during interminable and inconclusive international gatherings. It became increasingly absurd to discuss various issues – the global economy, finance, trade, geopolitics, energy, terrorism – with the behemoths of the emerging market world absent.

One by one, those central issues migrated to the G20. Paradoxically, given its composition, the G8 responded by focusing on development issues affecting the poorest countries.

The G8’s relationship with aid recipients in the developing world is that of a dysfunctional and abusive spouse. It promises good behaviour, reneges and then vows to be better next time.

...the returns to be gained from cajoling and criticising the G8 were increasingly questionable. Intensive lobbying by development advocates and celebrity campaigners extracted plenty of promises but not commitments that reliably bound group members.

At least Alan fulfilled his pre-meeting prediction that he would be able to use the words "interminable and inconclusive" once again in a G8 story, not to mention coming close to his fantasy G8 column that we featured on this blog before the meeting.