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UNICEF Social Inclusion, Policy and Budgeting

New Aid Architechure: A Good Fit for Children?

Cover Image
AUTHOR Gaspar Fajth, Szilvia Altorjai and Philip Denkabe
TYPE Working Paper
DATE 2006
TOPIC Child poverty and disparities

This paper investigates how the allocation of official development aid has changed between 1990 and 2003 in 186 developing and transition countries and what the implications of this change is for children. Data confirm that, when keeping other factors constant, donors are giving more aid to poor nations that are considered to have better governance.  There is evidence that when aid is managed by good governance countries, more children may be saved from poor health and deprivation. However, vulnerable populations in fragile states may also suffer under this model.

The international community should develop a Millennium Development Goal aid allocation model for donors to use to sharpen the efficiency of aid allocations.  Donors should develop a two-tiered aid allocation system where the first tier would secure a minimum level of development to all poor countries, and the second tier would secure additional support for governments with policies responsive to development problems.

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