The zero- or negative-effect results for foreign aid focus on measured GDP per capita, and don’t take into account increased lifespans, greater populations, and reduced disease burdens. (Adjusting the models for diminishing marginal returns to aid and different classes of aid also leads to better results on income). Some of the most beneficial programs were very cheap and widespread, e.g. the WHO/Gates Foundation effort to encourage worldwide salt iodization. http://www.abc.net.au/catalyst/stories/s1497255.htmhttp://www.saltinstitute.org/37.html.
Bill Easterly, who makes one of the most famous cases against aid today, uses a figure of $568 billion in aid for Africa through 2006, including huge amounts of World Bank and IMF cash transfers to governments (driven by extremely strong career incentives for the employees to push loans as quickly as possible), items purchased from American suppliers at much greater cost as political pork, etc. Much of this funding does not reflect the political will to spend on foreign aid, but even if we include it all the level of waste is not 99.9%.
From 1950 to 1997 life expectancy increased from 36 to 51, while population increased from 200 million to 622 million. During that period the lives of Africans were extended by hundreds of millions of life-years, at the same time as millions of malaria deaths were averted by chloroquinine and insecticidal sprays and other observable medical treatments were administered. Even if we say that most of the increase was unrelated to aid and mosquito sprays of that increase was surely not due HIV has offset this improvement since 1997, it makes the 99.9% waste figure misleading.
Of course, the money could be spent orders of magnitude more effectively, the biggest advocates of aid present the statistics in highly misleading fashion (e.g. describing the cost of a drug without mentioning huge distribution costs and incomplete compliance) but I think you’re overstating the case by citing only these selected studies and GDP benefits.
[HT to Toby Ord for the life expectancy data]
Eliezer,
The zero- or negative-effect results for foreign aid focus on measured GDP per capita, and don’t take into account increased lifespans, greater populations, and reduced disease burdens. (Adjusting the models for diminishing marginal returns to aid and different classes of aid also leads to better results on income). Some of the most beneficial programs were very cheap and widespread, e.g. the WHO/Gates Foundation effort to encourage worldwide salt iodization. http://www.abc.net.au/catalyst/stories/s1497255.htm http://www.saltinstitute.org/37.html.
Bill Easterly, who makes one of the most famous cases against aid today, uses a figure of $568 billion in aid for Africa through 2006, including huge amounts of World Bank and IMF cash transfers to governments (driven by extremely strong career incentives for the employees to push loans as quickly as possible), items purchased from American suppliers at much greater cost as political pork, etc. Much of this funding does not reflect the political will to spend on foreign aid, but even if we include it all the level of waste is not 99.9%.
From 1950 to 1997 life expectancy increased from 36 to 51, while population increased from 200 million to 622 million. During that period the lives of Africans were extended by hundreds of millions of life-years, at the same time as millions of malaria deaths were averted by chloroquinine and insecticidal sprays and other observable medical treatments were administered. Even if we say that most of the increase was unrelated to aid and mosquito sprays of that increase was surely not due HIV has offset this improvement since 1997, it makes the 99.9% waste figure misleading.
Of course, the money could be spent orders of magnitude more effectively, the biggest advocates of aid present the statistics in highly misleading fashion (e.g. describing the cost of a drug without mentioning huge distribution costs and incomplete compliance) but I think you’re overstating the case by citing only these selected studies and GDP benefits. [HT to Toby Ord for the life expectancy data]