Chapter

Practical and Theoretical Implications of the Joint Evaluation of General Budget Support

Michael Hubbard

in Foreign Aid for Development

Published in print February 2010 | ISBN: 9780199580934
Published online May 2010 | e-ISBN: 9780191723346 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199580934.003.0011

Series: WIDER Studies in Development Economics

Practical and Theoretical Implications of the Joint Evaluation of General Budget Support

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The chapter discusses implications for practice and theory of the recently completed Joint Evaluation of General Budget Support 2004-06 based on case studies in Burkina Faso, Malawi, Mozambique, Nicaragua, Rwanda, Uganda, and Vietnam. The chapter first looks at the extent to which general budget support, on the evidence of the evaluation, stands up to common criticisms of the effects of aid on government in low income, aid dependent countries. Allowing for much caution owing to the short period of partnership general budget support (PGBS) programmes in some countries, the finding is that there are small but positive impacts. The chapter then considers how the evaluation results affect the way that PGBS is understood in theory: (i) suggesting that PGBS raise entitlements (by increasing confidence that there will be continuing flows of budget support), which encourages policy development and stable donor-government collaboration structures, to which other shorter term aid arrangements gravitate, thereby reducing previous coordination failures; (ii) relations in organizations are then identified on a spectrum from market through club to hierarchy; and (iii) entitlements are accompanied by rules which attempt to raise positive incentive effects of the entitlement and reduce its negative incentive effects. The analysis of rules in relation to PGBS incentives and operating environments (on a spectrum from rigid/uncertain to flexible/predictable) concludes that fine tuning rules in rigid/uncertain operating environments is counterproductive. Integrating PGBS performance assessment frameworks (PAFs) into government plans and monitoring systems will serve to unify rules.

Keywords: aid; budget support; entitlement; rules; club; market; coordination

Chapter.  9410 words.  Illustrated.

Subjects: Economic Development and Growth

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