Do foreign aid donors reward recipients for improving gender outcomes?

Abstract

ABSTRACTWe investigate whether developing nations are rewarded by donor countries and multilateral aid organizations for improving women’s outcomes. If donors reallocate accordingly, their decisions could incentivize developing countries to improve gender outcomes on their own. Using dyadic aid flows over the period 1991–2010, we document that improvements in women’s political rights and participation, as well as economic participation, are associated with increases in bilateral aid receipts. Despite their stated emphasis on women, we do not observe similar reallocations in aid by many multilateral organizations in response to gender outcomes.