Sectoral Determinants of Korean Development Assistance: Similar, Yet Different?

Abstract

Are South Korean official development assistance (ODA) disbursement determinants different by sectors? The majority of existing studies have focused on either aggregate total ODA flows or regional distribution, although motivations for ODA allocation could differ by sector. Using a panel data set of 127 recipient countries over 16 years, this study investigates the determinants of Korea’s ODA allocation, especially grants, across five main sectors - specifically, education, health, public administration, technology, and agriculture. We find that the sectoral ODA allocation is generally determined by various factors and their impacts vary across sectors. It should be noted, however, that ‘the total ODA volume’ and ‘the status of Korea’s priority country’ show consistently positive coefficients regardless of sectors. Moreover, it was found that this effect continues to have a powerful impact even after Korea became an OECD Development Assistance Committee (DAC) member. The finding implies that political and strategic factors play a key role in determining the sectoral ODA allocation of Korea. For sectoral ODA disbursement to be further concentrated toward a smaller number of recipient countries, this study suggests that the number of priority countries should be reduced than the status of quo.