The Roles of Aid in Politics Putting China in Perspective



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McKinlay, Robert D. and Little, Richard (1978b), “A Foreign Policy Model of the Distribution of British Bilateral Aid: 1960-70,” in British Journal of Political Science, Vol. 8, No. 3, pp. 313-322.

Hitherto the foreign-policy critique of the humanitarian interpretation of aid (that aid is more closely related to the interests of the donor than the needs of the recipients) has not been developed into a clear and systematic formulation of the aid relationship. We have attempted to provide a more positive and satisfactory alternative to the humanitarian interpretation by establishing an explicit foreign-policy model. Aid is conceptualized as a form of both commitment and dependency and the rationale underlying the distribution of aid is seen as an attempt by the donor to promote and protect a variety of its interests through the advantages inherent in commitment and dependency. We have suggested that we can test our foreign-policy interpretation of aid in the case of the United Kingdom by examining whether clear and explicit interests underlie and explain its distribution of aid.

The appearance of a clear set of interests which can adequately explain the distribution of commitment and dependency established through aid suggests strong confirmation of the foreign-policy interpretation. The most important factor responsible for dictating the structure of commitment and dependency is the attempt on the part of Britain to promote and protect a sphere of influence. We have argued that Britain’s interest in this is essentially political rather than economic. Furthermore while the maintenance of the sphere of influence is not entirely divorced from Britain’s current or more long-term interests, it is clear that paternalistic and historical interests play an important and persistent role.

While the major preoccupation is maintenance of a sphere of influence, other interests do contribute to the pattern of aid disbursed by the United Kingdom: there is a selective antagonism to Communism, a preference for multi-party ‘democratic’ regimes, and, in the case of absolute commitment, a humanitarian influence. While the pattern of commitment and dependency differs, there is a basic consistency in the interests served, and in the persistence of these interests over time.

This analysis of the U.K.’s allocation of foreign aid can be placed in perspective by comparing it with official governmental statements on foreign aid policy, and with our findings on the policies pursued by the USA and France.

The 1958 Montreal Commonwealth Economic Conference introduced a series of major changes in the British government's conception of aid. By 1964 the United Kingdom had clearly accepted a commitment to provide economic aid to independent countries, the volume of aid had been substantially expanded, and the number of recipients had grown. Despite these innovations, the British government did not take any major policy initiatives.20 However, the arrival of the Labour Government in 1964 seemed to provide an opportunity. Before 1964 the Labour party was committed to a humanitarian, large-scale aid programme, and this was reiterated, albeit in a more cautious form, in its 1964 election manifesto. The new Labour Government acted quickly, establishing the Ministry of Overseas Development (ODM) and giving cabinet status to the minister.21 In 1965, the ODM produced its first White Paper which declared that the ‘basis of the aid programme is … a moral one.’ While this statement was tempered by mention of certain long-term British interests, the basis of the aid programme was explicitly defined in humanitarian terms.

Our foreign-policy interpretation of British aid contrasts sharply with the official view. Our findings show that the basis of the aid is not a moral one, and reveal no signs of new policy initiatives or changes, and no major expansion in the volume of aid. On the contrary, our findings corroborate the general conclusion of other commentators, who, from a different perspective, have argued that on the whole Labour’s record has been discreditable.22 It is clear that British aid has not evolved as the result of any explicit or long-term initiative but rather as a consequence of more immediate and ad hoc considerations of foreign policy.23

Our analysis of British aid is much more compatible with the results of our study of American and French aid.24 We have found that our foreign-policy interpretation provides a good explanation for all three countries. However, differences between the three do appear: the foreign-policy basis is not as systematically and comprehensively developed in each case and the particular interests promoted and protected vary.

In general, the foreign-policy basis of the British aid programme is not as systematically developed as in the cases of the USA or France. Simply by virtue of the size of its aid programme the USA can achieve much higher levels of commitment and dependency than any European donor can. France compensates to some extent by having a relatively larger aid programme than the USA and by concentrating its aid among a much smaller number of recipients. Thus, while France cannot rival the global scope and scale of the American programme, it can equal and in some respects even surpass the USA in a more restricted sphere. The United Kingdom, however, does not follow the compensatory strategy of France. The relative size of the U.K.’s aid programme more closely resembles that of the USA than of France, while the number of the U.K.’s recipients shows that it has a global commitment which again is closer to the USA than to France. As a consequence, the United Kingdom appears as a paler imitation of the USA rather than a copy of France, and so does not achieve the levels of commitment and dependency developed by either one or the other.

The less systematically developed basis of the British aid programme becomes even more apparent when we examine the different types of interest pursued by these three donors. The central interests underlying the distribution of aid by the USA are those of power politics and security. These reflect very clearly its superpower security role. The central interests underlying the French aid programme are the maintenance of a sphere of influence and the promotion of its trade. The United Kingdom has parallels with both these donors. Like France, the United Kingdom has a preoccupation with a sphere of influence. However, the sphere of influence is not as clearly defined, and the U.K.’s interest in its sphere is essentially political while France’s interests are both political and economic. The political basis of the U.K.’s aid programme has its counterpart in that of the USA but while the United Kingdom in some respects does try to play a global role, its interests are considerably more parochial. Thus, former colonial ties, though not all-embracing, are still very influential, while security considerations reflect historical associations rather than the explicit concern with the containment of communism that is prevalent in the USA’s programme. Finally, although the U.K.’s aid programme is certainly not modelled on humanitarian considerations, it contains a humanitarian component that is absent from the policy of France or the USA.

Our study of the U.K.’s aid programme shows it to be compatible with a foreign-policy interpretation of aid, and thus clearly at odds with the official view. In this respect the U.K.’s aid policy is similar to that of the USA and France. However, while there is a consistency and complementarity in the U.K.’s distribution of commitment and dependency, the U.K. does differ from the USA and France in that the foreign-policy basis is not as explicitly or systematically developed.

McKinlay, Robert D., and Little, Richard (1979), "The U.S. Aid Relationship: A Test of the Recipient Need and Donor Interest Models," in Political Studies, Vol. 27, No. 2, pp. 236-50.

Two models of aid allocation, offering alternative interpretations of the aid relationship have now been examined. The recipient need model, where aid is distributed in accordance with economic and social welfare needs, supports an economic assistance interpretation; the donor interest model, where aid is distributed in accordance with donor interests, supports a foreign policy interpretation.

Our findings do not support the recipient need model, and therefore, disconfirm a humanitarian or economic assistance interpretation of the US aid relationship. They do, however, support the donor interest model and, therefore, confirm a foreign policy interpretation. Many of the interests associated with a foreign policy interpretation, however, have little influence on the distribution of US aid. The level of economic development, the political structure, and the level of overseas economic involvement have no major direct influence. It is the power political and security interests of the US which consistently prove to be the central criteria underlying the distribution of aid over the period 1960-70.

Two general conclusions can be drawn from the findings. The first is that the US does not appear to distinguish between a commitment and a leverage strategy. The two strategies coalesce. This situation arises because the US is primarily concerned with the power criteria of the potential recipients rather than the relationships and policies which they develop. By concentrating on the ascribed power characteristics of the recipients, it appears that the US is not simply using aid either to reward and punish potential recipients, on the one hand, or manipulate their policies, on the other. The findings are consistent with the view that the potential recipients compete with each other for US aid and that their success depends upon their relative power capabilities rather than their willingness to subscribe to a particular line of policy. States which have developed policies commensurate with US interests, therefore, are not rewarded on the basis of the degree of their subservience to the US, but rather on the level of their power capabilities. Similarly, the willingness of the US to supply aid to states pursuing policies detrimental to US interests is also determined by the power capabilities of these states. The US, therefore, appears to use both commitment and leverage strategies, but these are byproducts of the decision to use power criteria to determine the size of aid allocation.

The second conclusion follows from the first. It is that the importance attached to power and security interests is consonant with the image of the international system advanced by the realist school.17 The image depicts international relations in terms of competing states acting in an anarchic system. The absence of any central authorities capable of establishing and maintaining international order engenders a preoccupation with security. States attempt to enhance their security by developing and maintaining a favourable balance of power.18 The significance of a state, from this perspective, is determined by the level of its power capabilities. Since the Second World War, the US has been preoccupied with the question of global security. Our findings suggest that this preoccupation has extended to the area of aid allocation. In other words, the amount of aid allocated by the US is determined by the importance of the recipient in the power structure of the international system. The US, therefore, appears to allocate aid on the basis of a realist view of international relations.

Meernik, James and Poe, Steven C. (1996), “U.S. Foreign Aid in the Domestic and International Environments,” in International Interactions, Vol. 22, No. 1, pp. 21–40.

This study is an initial empirical investigation of domestic and international environment variables on U.S. foreign aid allocation, from 1947-1990. We hypothesize that both of these environments affect aggregate aid levels, and are therefore important to the aid allocation process as contextual factors that influence the amounts of aid that will be available for allocation among recipient countries. When we test domestic and international environmental models separately, we find each performs quite well. However, in our most stringent test of these hypotheses, in which both international and domestic factors were included, we find that international variables, on the whole, tend to be more important. Variables identifying years in which the U.S. was a participant in war, the degree of conflict in U.S. Soviet relations, and the Marshall plan period are found to have had statistically significant impacts on aggregate levels of foreign aid once other factors are controlled. We also find that the domestic factor of economic hardship, which we measure with a misery index, is associated with fewer funds being devoted to the aid budget. We close by discussing the implications of these findings to U.S. foreign aid allocation, and outline some ideas for future research on foreign aid.

Meernik, James, Krueger, Eric L. and Poe, Steven C. (1998), “Testing Models of US Foreign Policy: Foreign Aid During and After the Cold War,” in The Journal of Politics, Vol. 60, No. 1, pp. 63-85, Southern Political Science Association.

To conclude convincingly that strategic aims are declining in importance and that ideological goals are gaining prominence will require more data for future years. Since the Cold War has only just ended and the norms and structures of the new order are just emerging, it is important to analyze continually the evolution of American foreign policy goals. Having never been an active participant in a world bereft of an all-consuming threat, the United States has little experience to draw upon to guide it through an uncertain international environment. Thus, a great deal of change will still likely emerge in the conduct of U.S. foreign policy. And certainly it is important also to expand the analysis of foreign policy behavior in this new environment to other activities, such as the use of military force, the defense budget, and foreign investment.

Ultimately, we believe that scholars should take the opportunity afforded by the end of the Cold War to develop models of state behavior and foreign policy that are more dynamic and comprehensive. We ought to derive measures of changes in the level of systemic threat and the effect of changes in the international distribution of power that are more sensitive to predict to what extent states can modify foreign policy goals. If the international environment has become less threatening, states may become less concerned with relative gains and more interested in cooperation. This kind of new world order ought to encourage states to take a long-term, enlightened self-interest approach to international affairs. It may make possible the fostering of institutions among states that promote economic development and the rights of individuals. Certainly if the United States remains a hegemonic power, we can expect it to try to inculcate these kinds of values (Ikenberry and Kupchan 1990).

Or if, as some argue, the international environment is becoming more unstable (Huntington 1993; Mearsheimer 1990), we may observe states increasingly resorting to beggar-thy-neighbor type policies. If such disorder arises (or has already arisen), states may be pressured to reduce their commitments to ideological goals and depreciate the value of long-term objectives. While our initial evidence would indicate this has not been the case yet, we would urge scholars to take into consideration the changes wrought by the end of the Cold War when developing and testing models of international relations. We need to take the recent criticism of international relations and foreign policy analysis (Gaddis 1992-1993; Lebow 1994) to heart by broadening our horizons and studying change or risk failing to foresee the next big event.



Menkhaus, Kenneth J. and Kegley, Charles W. Jr. (1988), “The Compliant Foreign Policy of the Dependent State Revisited: Empirical Linkages and Lessons from the Case of Somalia,” in Comparative Political Studies, Vol. 21, No. 3, pp. 315-46.

Studies of the linkage between economic dependence and foreign policy compliance have been confounded by the difficulties of measuring dependence. Single indicators of dependence may be inadequate reflections of what appears to be a multidimensional phenomenon, but the relative potency of these factors has not yet been weighed. The ability to determine the relative salience of dependence factors has been limited by the “dominant state-centric” model employed in prior research, which examines a single dominant state and the foreign policies of its many dependencies. This model fails to capture what, in reality, is the norm: that most peripheral states find themselves involved in dependent relations with two or more regional and global powers. A “dependent state-centric” model—one that examines a single dependent state's foreign policies vis-à-vis its several dominant states—thus is theoretically warranted, and its application provides an opportunity to compare the relative salience of different types of dependence across multiple dominant partners. An initial application of this model to the foreign policy of Somalia toward its dominant states from 1976 to 1980 suggests that export trade dependence is highly associated with a subordinate state's subsequent foreign policy behavior, whereas levels of foreign aid and military assistance dependence are not. In suggesting that weak states may experience different types of dependencies on different dominant countries and that these diverse relationships are associated with different kinds of behavioral consequences, this case study demonstrates the utility of this alternative model for addressing the linkage between economic dependence and political compliance, and reduces confidence in existing “bargaining”-based investigations of the generalized compliance hypothesis.



Michalak, W. (1995), “Foreign Aid and Eastern Europe in the ‘New World Order’,” in Tijdscbrift voor Economische en Sociale Geographie, Vol. 86, No. 3, pp. 260-277.

Aid to Eastern Europe is designed specifically for macro-economic stabilization and projects in infrastructure, nuclear weapons and nuclear waste disposal, improvement of the environment, training, transfer of technology and acquisition of know-how related to the functioning of democratic institutions, market economies and administrative systems. Most of these aid programmes are conditional upon adoption of far reaching economic and political reforms. Unfortunately, the donor countries lack coherent strategy and political will to devote substantial resources to the goal of stabilization of eastern Europe. Western aid is often considered in eastern Europe as overly cautious and overdue. Ethnic conflicts, the depth of economic decline and the sheer size of this region contribute to the confusion and shortsightedness of aid policies. Western aid is unlikely to make any significant impact on the process of reforms and stabilization of eastern Europe if it is to continue unmodified.



Milner, Helen V. and Tingley, Dustin (2010), “The Political Economy of US Foreign Aid: American Legislators and the Domestic Politics of Aid,” in Economics and Politics, Vol. 22, No. 2, pp. 200-232.

Theories developed in the international political economy literature and used successfully on trade policy can help explain voting on foreign economic aid. Many have claimed that there is no set of domestic interests that supports foreign aid (e.g. Lancaster, 2007). Our data show that this is not the case; i.e. it allows us to reject the null hypothesis that there are no systematic influences on legislators’ support for foreign aid. An identifiable and theoretically predictable group of legislators who support foreign aid exists. Domestic political and economic factors systematically influence American legislators when they cast their votes on foreign aid. Furthermore, we show that legislators seem to respond to the diffuse interests of their constituents, as some models of Congress predict. Legislators appear to understand the distributional implications of aid and to vote in accord with the preferences of their constituents, even though they are not organized and lobbying for such aid. Foreign aid is politicized and others have shown that domestic interests within donor countries affect aid policy (e.g. Alesina and Dollar, 2000; Dudley and Montmarquette, 1976; Fleck and Kilby, 2006; Irwin, 2000; Therien and Noel, 2000). Our contribution is to show which domestic groups support and oppose foreign aid and to provide a theoretical explanation for these voting patterns.

We show that two of the most important political economy theories – the Heckscher–Ohlin and Stolper–Samuelson theorems – have significant explanatory power for aid votes. On economic aid votes that have domestic distributional consequences, the Stolper–Samuelson predictions provide a strong explanation for patterns of support and opposition to such aid. Controlling for a wide variety of factors, districts that are better endowed with capital (labor) are more (less) supportive of economic aid, as the theory predicts. On other votes, like food aid and military aid, where the distributional consequences of aid are muted, the division between capital and labor is less salient. We thus offer one of the first systematic theoretical and empirical analyses of preferences surrounding foreign aid. We also utilize differences in types of aid to help evaluate our theoretical predictions. We show that political economy theories can be usefully imported into other issues areas when those areas have distributional consequences. An interesting question is whether this type of influence on aid policy exists in other donor countries. Interests matter, but so does ideology. Legislators respond not just to the material interests of their constituents, but also to their ideological predispositions. Legislators in left-leaning districts favor economic aid more than do right-leaning ones. On military aid, however, this relationship is reversed. Districts and legislators who prefer a larger role for the government in the economy and have stronger tastes for egalitarianism seem to be more disposed toward providing economic aid to others abroad. As Lumsdaine argued, a preference for government intervention at home to alleviate poverty appears to carry over to the international realm. Research on other countries suggests that this ideological pattern of support exists in other donors (Tingley, unpublished). The support that we sometimes find by organized labor for aid seems to rest heavily on its ideological appeal. But unlike in trade where conservative individuals generally support free trade, conservatives tend to oppose foreign economic aid. This ideological division is the opposite of the one in trade, and it makes the political coalitions in trade and aid different.

Another contribution is our finding that organized interest groups and their contributions to legislators are systematically related to support for aid. Legislators respond to the diffuse preferences of their voting constituents, but they are also attentive to the pressures brought to bear by organized interest groups. Many studies have found that campaign contributions do not affect legislators’ voting on issues (e.g. Fiorina and Peterson, 1998; Smith, 1995). Instead they argue that interest groups give contributions to like-minded legislators and that this “friendly giving” is driven by common ideology and constituent interests and not an attempt at influence (e.g. Bauer et al., 1972). Here we examine whether organized interest groups and their PAC contributions are systematically associated with votes on aid. We show that campaign contributions are channeled in ways that correlate with both ideological and political economy models of support (and opposition) to foreign aid. Such contributions (from money-centered banks and corporations) may account for why some conservative Republicans have been more likely to defect from their party’s position against aid, and why some liberal Democrats (because of contributions from labor organizations) may be more supportive of aid as a strategy of international engagement than they are of international trade. This finding stands alongside our other results, which suggest that a district’s factor endowments also influence legislators with particular ideological positions to vote differently than they might have on purely ideological grounds. In sum, organized interest groups and district economic characteristics seem to be predictably associated with legislative activity on economic aid, as they are on trade policy (Baldwin and McGee, 2000; Beaulieu and Magee, 2004).

More generally, our analysis implies that foreign aid policy is not driven solely by American foreign policy objectives, but also responds to underlying domestic political conditions. Presidents do not seem to dominate aid policy; their positions and preferences are not among the key factors that we identify in affecting a legislator’s votes on economic aid. Aid may well be used as an exchange mechanism to alter other countries’ behavior, but it must first command enough domestic support to win Congressional approval (Bueno de Mesquita and Smith, 2007). The existing literature that examines whether donor interests or recipient needs shape aid indirectly tests whether domestic interests matter by examining the characteristics of the recipients (Alesina and Dollar, 2000; McKinley and Little, 1979). In contrast, our study shows that domestic interests in the donor country directly affect foreign aid. Presidents must construct aid policy so they can garner majority support for aid in Congress. Legislators do not vote on aid randomly; they take into account its effects on their districts and vote accordingly. Political economy models can well explain this.




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