Foreign Aid and Assistance

by

James M. Scott

• LAST REVIEWED: 25 March 2020
• LAST MODIFIED: 25 March 2020
• DOI: 10.1093/obo/9780199743292-0282

Introduction

Foreign assistance is a flexible foreign policy tool used by donor states for a wide variety of purposes. According to the Organization for Economic Cooperation and Development (OECD), foreign assistance consists of financial, technical, and commodity flows aimed at social infrastructure and services (e.g., education, health), economic infrastructure (e.g., transportation, energy, financial services), production (e.g., agriculture, mining), humanitarian aid (e.g., disasters), multisector support (e.g., environment), debt relief, and budget support/program assistance (ODA by sector, 2019), and is distinct from military aid. Donors direct foreign assistance at a variety of issues (e.g., development, humanitarian relief, institution and capacity building) and through different means (e.g., bilateral and multilateral), but their interests and preferences dominate aid relationships. As such, it is subject of a vast literature examining its nature and patterns, its allocation, its effects, and its effectiveness. This review focuses on foreign aid and does not address military assistance.

Data on Foreign Aid

While studies of foreign aid run the range of methodologies, from large-n statistical analyses to case studies, three sources of aid data are commonly used: (a) US foreign assistance data from the US Agency for International Development (USAID) 2019; (b) official development assistance data from the Organization for Economic Cooperation and Development 2019; (c) project-level foreign aid data from most donors from AidData (Tierney, et al. 2011).

• Organization for Economic Cooperation and Development (OECD). ODA by sector (indicator), 2019.

  DOI: 10.1787/a5a1f674-en

  The Organization for Economic Cooperation and Development maintains extensive data and public information on the aid programs of its 36 member countries.

• Tierney, M. J., D. L. Nielson, D. G. Hawkins, et al. 2011. “More Dollars than Sense: Refining Our Knowledge of Development Finance Using AidData.” World Development 39.11 (2019): 1891–1906.

  DOI: 10.1016/j.worlddev.2011.07.029

  An extensive data set and analyses on global aid programs, with annual project-level aid data for most donors.

• US Agency for International Development (USAID). Reports and Data. Washington, DC: USAID, 2019.

  The US Agency for International Development maintains extensive data and public information on the aid programs of the United States.