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GLOBAL ECONOMY DEVELOPMENT
WORKING PAPER 21 | JUNE 2008
WHERE DOES THE MONEY GO?
BEST AND WORST PRACTICES IN FOREIGN AID
William Easterly
Tobias Pfutze
The Brookings Global Economy and Development
working paper series also includes the following titles:
• Wolfensohn Center for Development Working Papers
• Middle East Youth Initiative Working Papers
Learn more at /global
William Easterly is a Visiting Fellow with the Global
Economy and Development Program at Brookings,
and Professor of Economics and Co-Director of
the Development Research Institute at New York
University. He is also a Research Associate of the
National Bureau of Economic Research.
Tobias Pfutze is a Ph.D. student in Economics at New
York University.
Authors’ Note:
We are grateful to Andrei Shleifer and Timothy Taylor for comments and suggestions.
WHERE DOES THE MONEY GO? BEST AND WORST PRACTICES IN FOREIGN AID 3
CONTENTS
Abstract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
What Would An Ideal Aid Agency Look Like? . . . . . . . . . . . . . . . . .
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