Graduate Institute of International Studies
Science politique et organisation internationale
Summary by Marcel Stoessel
Intersocietal transfers of resources that are intended, by the relevant parties, especially the provider, to serve first and foremost the recipients needs, interests, or wants.
Burnell, rather liberal definition
Resources transferred on concessional financial terms with the promotion of the economic development and welfare of developing countries as the main declared objective.
OECD definition of ODA
Military assistance – economic assistance
Problems with military assistance
DC side: USA (60’s) gives more than half of its “economic aid” to programs that serve its military and security interests
RC side: fungibility of aid: helping Mobuto develop Zaire’s economy allows him directly or indirectly to pay for his military
We mainly deal with economic aid in this chapter.
Resources transfers RT (broad definition)
Gvmt/IO à gvmt/IO
Not only financial transactions, also goods, services (salaries of advisers…): everything is counted in $$
Other RT (not FA): private loans, investment make up ¾ of total RT
c) Grants (gift) – loans (to be paid back by RC)
Concessionality – how to make a loan foreign aid
One part of the aid is given as a grant, another as a loan
Lower interest rates
Terms of borrowing
ODA – OOF
Organization for Economic Cooperation and Development (OECD) distinguishes:
- Official Development Assistance (ODA): 25%+ grant element
- Other Official Flows (OOF): <25% grant element
There are lots of ways to make OOF into ODA
Included: humanitarian aid, emergency aid. Not included: NGO’s
Tied aid – is it ODA?
The funds that are given (grant) have to be spent on g/s from DC
Might not be the best allocation of money
g) Bilateral (2 gvmt) – multilateral aid (IO and gvmt, or NGO)
Since the 80’s increasingly:
- 1st generation conditionalities: economic; structural adjustment lending (SAL) IMF/WB
- 2nd generation conditionalities: political; good governance: democracy, human rights, the rule of law
No formal way of control except threatening to cut FA
The private market is much more important: 1995 RT: 250 billion; ODA 55 billion (app. ¼)
Frees up gvmt resources of RC
FA can be up to 9% of state’s GDP in poor countries
but: 70 billion / year (1990) repayment of debt (more than total of ODA) à not just a supplement
Mobilizes other RT
If you can get ODA you are more likely to get OOF & private loans / investment
Depends on statistics you use.
Bilateral in absolute amounts:
Japan-US-France-Germany tops the list
à used by realists: power & control over RC
Problems: US pays 3 out of its 11 billion just to Egypt and Israel (security interests) / France includes overseas departments / Japan lots of tied aid, etc.
Bilateral in % of GDP
(let aside Saudi Arabia / UAE):
Norway-Netherlands-Denmark-Sweden (Japan 13th, US not on list of top
à used by humanitarian liberals: norms of justice and equality / global poverty, economic growth & prosperity
Problems: Saudi Arabia / UAE
c) Multilateral aid: about 30%, increasing
Absolute and relative amount:
sub-Saharan Africa-Middle East/North Africa-South Asia-East Asia/Pacific-Latin
à most FA to poorer countries (least useful economic partners and military allies: against realism)
Foreign aid has only emerged as a regime after 1945.
Regime = mode or rule of management
a) Aid bureaucracy of states and IO, i.e. USAID
b) RT to Third World countries: the difference between the colonial and the post-colonial world
c) Economic development as a promise or an ideology
“Europe first”, US an anti-imperial and anti-Soviet power. Marshall plan.
US 1st systematic aid program: “Point Four Program” of Truman a predecessor, but primarily creating client-state relations (e.g. Vietnam, Thailand, Philippines, Formosa, South Korea) à security concerns.
Spread of DCs (primarily) and also RCs
Other states start giving aid. Ex-colonial powers (GB, F), others (Canada, Norway, Sweden)
Prebisch, Declining conditions of trade (“pay more
for what we get, get less for what we sell”). The West becomes a lot richer,
increasing its state apparatus and social welfare system. It wants to promote
development also elsewhere.
Created in 60’s: OECD with Development Assistance Committee (DAC); International Development Association (IDA) of the WB / UNDP / Inter-American Development Bank, African Development Bank, Peace Corps, …
US aid increased in the 60’s.
Around 1969: Japan has paid off its debt, becomes one of the largest DCs.
Move towards multilateral lending (WB, regional development banks, etc.) in the late 60’s. More concessional and development-oriented. The DAC adapted the goal of 1% of GDP, then reduced it to 0.7%.
Debt crisis in early 80’s: Inflation, high interest rates, oil shocks à world debt increase (borrow to pay interest), primarily on floating interest rates à debt crises in 1982 recession. The WB comes in to organize a response to the threat of some countries not to pay back at all à increase in multilateralism.
OPEC aid increased during this time.
Neo-liberalism, stagnation of FA
Encouraging private economy of LDC’s instead of giving money to gvmt’s
Giving less FA generally, return to bilateral aid in the US
Aid fatigue (steady erosion of confidence): failure of imagination, lack of foresight in DC, quality of aid. Occurs when economic troubles in DC, public opinion in DC, other good causes (environment), mass media
Aid increasingly conditional to economic conditions (SAP/SAL)
Still aid fatigue, also with SAP/SAL
Tendency towards bilateralism
Aid increasingly conditional to political conditions (democracy and good governance)
1950 – 65 Growth of FA (3%/year)
1965 – 70 Stagnation of FA
1970 – 80 Growth of FA due to oil-exporting countries (5%/year)
1980 – 90 Overall stagnation of FA (some countries decreased, others increased FA)
1990 – 99 Slight diminution of FA
à See also paper.
à Morgenthau: FA is not a very good instrument of economic statecraft
à Baldwin: Economic statecraft
à Zimmermann speaks about realists’ attempts to explain US FA
FA = instrument of economic statecraft, power politics, influence other actor’s behaviour
Economic instrument of power;
FA is tied to realist objectives
a) Military forces are the main instrument of statecraft for realists
Economic aid = influence attempts that rely on economic
resources = positive sanction
E.g. embargo = negative sanction (Baldwin)
c) Social exchange: favour is expected to be returned
a) Same behaviour by all states
National interest pursued by state = unified actor
Core interests: survival, physical & military security (including alliances)
Aid must go to middle powers who are of key interest for the military defence/security or the overall health of economy / e.g. for alliances
Spheres of influence: Cold War (CW). Zones of influence: post-colonial states.
c) Secondary interests: Diplomatic access, trade partners, access to resources, etc.
a) Emergence: Context of the Cold War. Nothing fundamentally different since 1945
b) Principles: balance of power, SNL. New regimes are explained by power balancing
c) Principles of the regime serve primarily interests of hegemon, e.g. strategic non-lending for US economic gain
change, e.g. checking inequalities of private market
Agents of change: e.g. religious & charitable groups (19th), labour movements, social-democratic parties
Bottom-up process (society to gvmt), but also top-down process
Mechanisms: begin to change what’s common sense
E.g. Red Cross à International Humanitarian Law
Elimination of colonialism (until 20’s: n&v in favour of colonialism; afterwards: progressive normative change)
Extension of argument: FA regime
Principle: promoting economic development of poor and
less advantaged states
Providing quality aid that is:
- on more concessional terms
- more generous
- more multilateral (less chance of an influence attempt)
- the poorest first (same conclusion like SNL)
a) Variation according to political orientation of state (social-democratic or not): welfare state associated with emergence of the FA regime
b) What kind of state: democratic, authoritarian (unlike realists)
We gradually seem to move from realism to humanitarian liberalism because of the emergence of international norms
Wood talks about the effects of foreign aid. There is not necessarily a connection between intention and effect.
Foreign aid serves the economic interests of core states. It is primarily responding to the needs of the private market. (During the CW, FA helped keep states from becoming communist, thus quitting the world capitalist system).
The US hegemony has set the rules for the post-1945 world.
- preventing social revolution (Wood)
- prevent statist’s development (that state intervenes excessively in private market, e.g. state industries, closing out foreign investors)
1) Strategic Non-Lending (SNL):
Not give loans on concessional terms to countries that can get them on normal terms from the private market
Logic of SNL is an attractive climate for private lenders, e.g. not nationalizing industries, no para-statal industries
2) Institutionalised Non-Competition (INC):
Aim is to make the terms of the loan very close to the private market. So DCs (e.g. WB) will not compete to be more generous. Instead, when there is a loan closer to the private market available from another organization, the “softer” lenders will stay aside.
Multilateral aid and bilateral consortia very much INC
3) Aid graduation:
At a certain level, no more aid needed. Then only private finance will be available
4) Strategic lending:
Revolution = danger of leaving the world capitalist system, e.g. South Vietnam consumed up to 25% of US ODA; Chile, South Korea.
Wood argues about the logic of the system: DC choose who they want to support
State-society theory: States dependent on capitalists.
In realism, the unified rational actor state determines autonomously its interests. Here, also the state is subject to the world capitalist system
HL: talk about what aid should do, not what it achieves. Lumbsdaine: Good intentions should give good results.
R: talk about effects only in a narrow sense (power relationship: influence attempt successful?)
Burnell: No, FA does not work, at least not until now
60’s: traditional backward economies, lack of savings, lack of modern skills & attitudes (population), lack of modern technologies
à Economic growth is the answer to poverty
RT to TW gvmt’s so that they can intervene in their domestic economies, eliminate bottlenecks (e.g. replace domestic savings with FA)
60’s: no US or WB policy to restrict intervention
Wood 1981: change in WB policy
Assumption (they imply support for FA)
- Market-pessimistic but market-based: Weak TW economies can’t create growth by themselves, need intervention (Keynes), but of limited duration and in a few areas only
- Trickle down: Growth will reach the poorest over time
- Developmental state (Ferguson): Major concern of state is economic growth for all members of society (good government) & Western understanding of economic policy
- Most of the time, bottlenecks not released
- Debt crisis end 70’s / beginning 80’s (there shouldn’t have been a debt crisis)
a) 70’s, 80’s, particularly directed at sub-Saharan states à little success, according to critiques, because of gvmt intervention; Reagan, Thatcher, Kohl reduce aid
Gvmt’s prevent growth by intervening in the economy à
FA makes people worse off
General equilibrium theory: intervention brings sub-optimal outcomes
Market-optimistic and market-based
- Assumptions wrong: Perfect competition, etc.
- Historical “proof”: Newly Industrialized Countries (NIC): theory would say that thanks to less aid they could develop, e.g. South Korea: before 1960 lots of aid but less growth, after 1960 less aid but a lot more growth. BUT: 1) SK = developmental state because highly interventionist, e.g. export incentives; 2) more foreign investment (equivalent of FA). So gvmt intervention not systematically negative.
BGC not scientifically proven
Part of new politics of aid
Soft power state
Soft power, system of rule: lack of legitimacy, the bad guys in power will not put EG first, so FA can’t relieve poverty because it’s not in gvmt’s goal; corruption
e.g. Haiti 1957 – 1986 1% of population gets 40% of wealth (clientalism)
Cleptocracy: Gvmt steals everything that’s of value
Structural power critique (almost identical to dependencia,
FA serves rich countries & private markets that want access to resources, labour, etc. à international clientilism
Alliance: FW&eco with TW&eco à that’s why bad guys stay in power
FA maintains a system of global inequalities (Wood)
SPC intellectually doubtful: There should be little growth profiting the rich. But trickle down can be observed in some states like Costa Rica, NIC’s. So aid doesn’t always make things worse
Best examples: small-scale micro-projects that are channelled directly to the poor (small part of development community work)
Smaller part goes to gvmt through traditional aid projects
Initially a response to failure of aid and to debt
economic crisis in TW countries (too much intervention, devaluating currencies,
para-state industries, …)
Solution: macro-economic policy reform, liberalize markets à Structural Adjustment Programs (SAP)
Not project aid as such, but large sums to transform entire sectors of TW economies (programs)
Mid-80’s IMF/WB, then also bilaterals
Structural Adjustment Conditionalities (SAC)
1st generation of conditionalities
Agree to undertake macro-economic change with implicit or explicit threat to remove FA if SAC are not met
As technical help (programs)
WB & many bilateral agencies
FA not to be used for political purposes inside the RC, more so technical help to improve administration
- reduce gvmt size, e.g. selling off para-statal enterprises
- employ remaining bureaucrats in a modern way, e.g. no corruption
- rule of law: modern legal code, transparency, efficiency
Other than technical help, conditionalities of 2nd generation for all kinds of aid, so technical may become political
- Money & conditionalities à democratic reform in post-colonial states
- Money & conditionalities à encourage HR & civil liberties in general
- Strengthening civil society à channelling money to NGO’s in RC
This is an extensive program of social engineering that can’t be described as technical changes
Sources of democratisation agendas:
- social mvmt in post-colonial states
- aid professionals
- Western leaders: Kohl, Blair, Reagan, Bush, Clinton
after fall of communism relatively easy
response to Western public’s disgust for supporting dictators
less need for clients
belief that democracy = best way for economic growth and peace
Relatively small in $$, but increasing and with big effect
E.g. electoral assistance, HR, retraining police forces, funding private media, money to NGO’s to strengthen civil societies
Explosion of actors: quasi-NGO’s as subcontractors to bilateral & multilateral NGO’s
Other money can also be made dependent on democratic progress, e.g. Haiti, 1991
Re-making of states (democratisation) not accommodated
Other actors than states (NGO’s, public opinion, etc.) not taken into account
Moral issues not taken into account
SA/GG in the core states: historically untrue
SA à state reduced, ideal liberal conditions for world economy à poor are hurt
Reproduce unequal system
Doesn’t say you need a particular economic system à SA badly accommodated
GG important argument for HL: GG happens, but inconsistent practices:
- donor selectivity (e.g. Burma & China in US aid)
- multilateral inconsistencies: IC not acting as an international society (not everyone includes democratic conditionalities)
(à Crawford: all conditionalities the more effective the more: 1) coherence DCs; 2) coherence executive – legislative; 3) dependence of RC; 4) weak state; 5) other interests of DC not too big)
But: new standard of Western leaders, we can hold them accountable to the same standards
d) Is 10 years enough to assess change?
à see also the hand-drawn graphic
Great-power wars very regular
General European war: Napoleonic war; long periods of non-war
Two total wars (all of the population involved)
Waltz: Guru of SR’s.
à Gaddis: believes in Guru, but adds some unit level elements like nuclear weapons, reconnaissance systems, etc.
The important units in IR are states (unitary rational actor),
especially great powers. The fundamental condition of the international system
(IS) is anarchy, which makes it a competitive self-help system, a power
politics world. Minimum assumption: survival.
SR leave aside all particularities of the units, like national interest and instruments of statecraft. It is rather a system level theory: the balance of power. Distribution of power in IS: polarities. From polarity the Long Peace is explained: a bi-polar (2) IS is more stable than a multi-polar (3+) IS. Post-1945 is a bi-polar world: States like France, Switzerland (“lesser allies”) don’t count. Military power with USSR and the USA.
1) Fewer states: Less statistical probability than multipolar
2) Certainty: Who is a threat and who isn’t? Who should be the leader of an alliance? This induces caution/attention (Singer).
3) Simplicity: Relatively uncomplicated relations within alliances; rel. little importance of lesser allies; fewer defections
(Wars like Vietnam and Korea are irrational)
Bi-polarity would exist even without nuclear weapons (“unit level”), but they do matter. The possible complete destruction each other
- increases caution/attention
- less risk-taking for the lesser allies
SR poses something like a natural law (deductive rigor). Premises à all other elements of theory
Reasons to question:
- evidence: only 1 case of bi-polarity
- alternative explanations: US&USSR no common borders; no ethnic minority issues between US/USSR; both abundant in natural resources (Gaddis)
Emphasis on state and societies, guided by norms and
values. Changes in n&v made war “subrationally unthinkable”.
Also economic liberal argument: cost/benefit
Bi-polarity not a major feature of thinking à why is there no war between rich states?
19th century: anti-war movement (Red Cross, Quakers) clear minority. Majority valued war.
Progressive normative change
1) Catalyst 1: World War I. Big bang for normative change. Majority against war, cultural rejection. (also cost/benefit)
League of Nations (LON): Collective security. Or: Strong national defence. Or: Appeasement (negotiation). Generally a shift away from war as a useful policy.
Exceptions: Japan (cultural outsider), Germany (rational calculation; a defector)
2) Catalyst 2: World War II. Finishes lesson-making for industrial states. Gvmt’s/elites & general population against war.
3) Long Peace: Major war is not a policy option anymore in industrialized states. Military as deterrence: war something to be prevented. No expansionary war machines anymore. Also rational arguments (industrial realpolitik) against war, but beyond that: subrationally unthinkable
à Neither bi-polarity (Waltz) nor nuclear weapons explain LP
N&v change: Military patriotism died à demilitarised societies à spectator militarism. Changes in state purpose: Still large war machines, but now: economic prosperity first
What time does this subrational change happen with elites?
Military plans in USSR and US effort to conquest Korea point more towards rational calculation (Waltz)
Nuclear weapons: Strategies tied to the use of nuclear weapons à how to fight and win a war? (Kissinger & Co.) à no way to practically win a nuclear war; also conventional war big mistakes . (but these are rational calculations)
War is today indeed subrationally unthinkable between advanced nations, but Waltz explains better the LP.
Developed countries have 80% of military resources. They were heavily involved in intrastate wars in developing countries since 1945 (à See paper)
à Van Crefeld
Out of 160 conflicts since 1945, 128 (77%) are LIC
Definition (Van Crefeld):
- at least one state not a great power
- mostly low-technology
- (rarely regular armies)
- (taking place in developing countries)
b) Magnitude can be low or high (Nigeria: 3 mio. deaths)
- state-making, national liberation
- state-secession (post-decolonisation) state vs. nation
- changing the political economic system
Explaining LIC: only one theory: ethnic-political conflict. Little literature after 1989
à Gurr & Harff
EPC = armed conflict between a gvmt and (an) ethnic group(s) (common interest & identities based on historical experience and valued cultural traits) within a state
During the CW, every LIC was looked at ito CW. In the
post-1989 era it has become a subject of IR.
G&H don’t analyse the underlying causes, but just ask when arms are taken up. They try to make a kind of early-warning system for ethnic violence.
1/2/3: Factors ethnic group
4/6: gvmt factors
5/7: IS (exterior) factors
1. How discrimination against 4. Type of political envirmt conflict resolution EG? (Inequalities) +
+ +/- 5. Government violence
2. Strength of the group identity +/-
Extent of EPC 7. Status eco int’l
3. Degree of the EG cohesion: + -
leaders: keep the group
together + 6. Extent of
e.g. sending weapons
1) Restriction of economic activities / low income / poor housing / limited access to education
feeling (because of discrimination)
Common traits: language / religion / culture
3) Degree of acceptance of social order / number of factions
4) Civil & political rights / effective constitutional limits / multiparty
5) Power of executive / restrictions
civil liberties & political participation
Numbers of arrests / massacres / genocide (in that case less extent of EPC)
6) Financial / weapons & supply
of resources / per capita GDP
Testing the G&H model
Germany and the Turks
Iraq and the Kurds
Yes, but some middle class
G&H: d. not high enough to take up arms
Yes, heavy discrimination. They are not wished. Gvmt tries to eliminate them with arms
(Oilfields in northern Iraq)
4) Political environment for conflict resolution
Not same redress to courts as citizens, but rule of law, possibility to make themselves heard
No peaceful way of resolution, courts etc.
5) Severity of gvmt violence
Attempting to eliminate the whole EG
6) Extent of external support
Iran supplies weapons to EG
à Less violence on both sides
à More violence on both sides
Milliken’s problem with the EPC model:
- With prediction: not a lack of information, e.g. Hutu/Tutsi: violence went on for long à no need for prediction, UN had estimates available
- With solution: any solution that doesn’t take into account the root causes of EPC are likely to fail
Conclusion: need to assemble sufficient detailed information on states/EG to make analysis.
Opposed to: rational-legal administration, which works for the good of all people
Privatization of gvmt à no substitution for officials
Strict hierarchy à a superior has always the right to intervention, is not always there
b) Bureaucracy enormously inefficient
c) More corruption: public office for private gain
Clientilism between gvmt and selected groups in
population: mean (beyond repression) to secure rule for gvmt. (Also in
democracies you can have clientilism)
E.g. provide access to recourses & securities in exchange for support
Gvmt & administration
Important groups in society
People dependent on these important groups in society
à Society and state did not merge, state can be more influenced
a) Powerful: army police, extracting resources from population
Always temptation to try to overthrow gvmt (well-paid positions), getting to the top of clientilistic system (within or outside gvmt). Lack of organic unity state-society
E.g. after decolonisation in Africa formal democracies turned to dictatorships
legitimacy in the longer term
No organic unity
E.g. nationalism, apartheid, can’t operate general warfare
coalition: trying to stabilize
Coalitions, creating insiders and outsiders. The latter have grievances against gvmt, maybe ethnic discrimination
E.g. Rwanda/Burundi à those in control were tiny minority (Belgians)
E.g. social class
of the rule of the coalition possible in the longer time-frame
E.g. Somosa dynasty in Nicaragua: 20+ years of support in Nicaraguan oligarchy (clientilism) & national guard; then the bad economy and misused money after an earthquake fed greed against the regime. Both peasants and parts of the oligarchy came out against Somosa. Overthrow of regime.
BUT: could also lead to further repression in the process of shrinkage
Reflection on state structure, not a theory as such; nonetheless necessary to arrive at a solution
Good way: Power-sharing would be the best solution e.g. for Iraq (where clientilism excludes Kurds), but the Iraqi gvmt could say No, or they could agree but not implement
 OECD, 1994.
 OECD, 1994.
 They mainly give FA as budget adjustment: Some poor countries could not otherwise afford their oil. In the last few years, their position has been declining.
 Influence: Dahl’s power definition: Someone gets someone to do something that he or she would not otherwise do.
 Norm (political science) = shared understanding