Impacts of Aid

The impacts of aid have been measured and researched over the last several decades. Understanding what forms of aid are the most effective is crucial to going forward. Although the developed world does feel a degree of 'aid-weary' there is strong evidence to suggest that the aid has been effective. There are key indicators which help measure the effectiveness of aid, such as; infant mortality, school completion rates, life expectancy, poverty head count ratio and many more. USAID established the impacts of its foreign aid globally. Firstly, life expectancy has increased in the world by around 33%. [12] Additionally, the percentage of people who are "chronically undernourished" has been halved. Many diseases have been controlled and minimised, and in some cases, such as smallpox, eliminated globally. [12]

Aid organisations communicate their successful work on various platforms. It does this so the people who donate can see what is being done with their investment, and also to further encourage others to donate. This relationship between the organisations and the public is crucial to the continued support of the aid organisation.

This video shows the huge impact that the installation of the water pump has had on the community. The raw emotion from the people, who are celebrating that they now have clean water is an evoking scene. [6]

The two villages of Belavabary and Ambonidobo in Madagascar, now have access to clean and safe water. The community would have to walk miles to collect dirty water and return it to the village. The people of both villages were active with Water Aid's local partner FIKRIFAMA to help install this water pump. [6]

Millions of people are living with no access to water, or toilets. Hygiene is poor and women struggle greatly with sanitation regarding menstruation. This access to clean water is going to change that community for the better. A large percentage of the community which would have collected the dirty water would have been children. This may have prevented them from going to school, or limited their education as they had to collect water for their family on a daily basis.

Measure Effectiveness of Aid

Many micro and macro studies have taken place to assess the effectiveness of aid. Most micro cases show the positive effect of aid, just like the above example in Madagascar. Whereas macro cases have proven highly ambiguous. Many models are used to calculate the relationship between aid and economic growth. Results vary according to income level, levels of aid allocation and geographical location. [5]

The effectiveness of foreign aid is highly questionable after numerous amounts of research and empirical data have been gathered. Micro evaluation found that aid works, 'micro macro paradox' reasons behind this remains unclear. Aid growth literature which negatively the impacts of aid has been criticised for; sample size, composition, data quality, econometric, techniques and specification. [5]

Since the 1980's much aid from multilateral lending agencies has been linked explicitly to macro-economic policy reform and structural adjustments. Recent studies which have used research models such as the Fischer Easterly type model and estimate using the Barro Model. These are used to determine the strength of the relationship between economic growth and foreign aid. [5]

Bigger Picture

Maternal mortality ratio (modeled estimate, per 100,000 live births) [4]

The following graph shows a steady decline in the number of maternal mortalities since the year 1990. This is largely due to the impact of foreign aid. [4]

The World Bank data gives an insight on the impact of foreign aid in the last couple of decades. The indicators of world development all show improvement, whether that be dramatic or slow. The data stretches across 264 countries, and supports the argument that aid is having a macro impact on the developing world. [4] 'Aid effectiveness is the impact that aid has in reducing poverty and inequality, increasing growth, building capacity, and accelerating achievement of the Millennium Development Goals set by the international community. Indicators here cover aid received as well as progress in reducing poverty and improving education, health, and other measures of human welfare' (World Bank, 2018). [4]

Improved Sanitation facilities (% of population with access) [4]

The following graph shows a steady increase in the percentage of population which have access to sanitation. Sanitation is a vital to health and reduction of disease, and allows people to live with dignity and confidence. Young girls drop out school at an early age, due to menstruation. Schools may not have the correct facilities, and have no access to toilets. [4]

School enrolment, primary and secondary (gross) gender parity index (GPI) [4]

The following graph shows the steady incline in the number of children which enrol in both primary and secondary school. This is an encouraging statistic for long term development. With the next generation having basic skills to read and write, their standard of living will be impacted significantly. [4]

These statistics show the macro research done by the world bank and show the impacts of foreign aid globally. These three examples are major factors which measure the standard of living in developing countries. Sanitation is vital, and with the correct facilities hygiene will improve and there will be a depletion in the spread of disease. Young girls which fear leaving the house due to menstruation will find it easier to go knowing there is toilet. The amount of maternal deaths is decreasing due to improved health and maternal care. The number of children going to primary and secondary school is also increasing. Education is vital for pathways out of poverty and give communities the ability to grow.