Aid, Poverty Reduction and the 'New Conditionality'

  title={Aid, Poverty Reduction and the 'New Conditionality'},
  author={Paul D Mosley and John Hudson and Arjan J. Verschoor},
  journal={Development Economics},
The paper examines the effect of aid on poverty, rather than on economic growth. We devise a 'pro-poor (public) expenditure index', and present evidence that, together with inequality and corruption, this is a key determinant of the aid's poverty leverage. After presenting empirical evidence which suggests a positive leverage of aid donors on pro-poor expenditure, we argue for the development of conditionality in a new form, which gives greater flexibility to donors in punishing slippage on… 


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