SITE researchers Anders Olofsgård and Maria Perrotta Berlin won 1.8 MSEK from Vetenskapsrådet for research on the community-level impact of foreign aid-financed interventions.
The research project analyses two related questions. What determines the within-country allocation of aid projects? How does the presence of aid projects at the community-level affect female empowerment and democratic values? Evaluations of individual aid-financed projects are often much more positive than country-level studies, a conundrum referred to as the “micro-macro paradox”. Common explanations refer to data and methodological challenges in trying to identify a causal effect at the aggregated level, and positive selection bias in terms of which projects are evaluated at the micro-level. A literature on geo-spatial impact evaluation of foreign aid is currently emerging based on new data on geo-coded aid projects. With this data it is possible to analyse the placement and impact of aid at the community level, i.e. more disaggregated than cross-country analysis but also beyond just the impact of individual projects on direct beneficiaries.
This project proposes a new methodological approach to further our understanding of the two research questions asked above: to better understand the patterns of within-country aid allocation in order to be able to address questions of motivation, effectiveness and representativeness; and to estimate the community impact of aid presence on two important objectives of foreign aid, female empowerment and democratic values.