Recent changes in aid technology: is the White Paper an adequate response?

Recent changes in aid technology:is the White Paper an adequate response?

PAUL MOSLEY*

University of Reading, UK

SUMMARY

This article shows how the structure of aid disbursement has changed over the last 30 years tore¯ect increasing disillusion with the LDC state and with the traditional `development project'as an instrument of development. Aid is simply a di�erent thing from what it was at the time ofthe last White Paper in 1975, consisting now mainly of technical assistance (much of it fortraining), programme assistance, private sector support and emergency aid, with traditionalgovernment-to-government project aid well down the list of priorities. How poverty will bereduced using this di�erent mix of instruments is not spelled out in the White Paper. We seekto ®ll the gap by presenting a map, or menu, of alternative poverty strategies. Which elementsare selected from the menu will depend partly on political feasibility and partly on relative cost-e�ectivenessÐabout which we still know little, after 10 years of renewed anti-poverty e�ort.This opens up a whole new research agenda. Copyright # 1999 John Wiley & Sons, Ltd.

INTRODUCTION

Over the 50 years of its existence the targets of aid have not changed: for recipients,growth and poverty reduction; for donors, commercial and political advantage. Thebalance between these objectives is constantly shifting and constantly disputed, andthe United Kingdom White Paper of 1997, `Eliminating world poverty: a challengefor the 21st century' is not the ®rst attempt, even in Britain, to try and increase theemphasis on the second of these goals (Department for International Development,1997; United Kingdom, 1997). This renewed emphasis has been widely welcomed anddebated (see e.g. Select Committee on Overseas Development, 1998; symposium inJournal of International Development, March 1998). Such debate has in particularfocused on the questions of how the White Paper's broad declaration of intent can beconverted into an operational anti-poverty strategy and whether its concept of`partnership' between aid donors and, in particular, recipient countries can e�ectivelyreplace the conditionality used as the main instrument to improve aid e�ectiveness inthe 1980s and early 1990s.

This article seeks to contribute to the debate by drawing attention to the manner inwhich the technology of aid delivery has changed over the last 20 years. Whereas thetargets which aid attempts to juggle have not altered, the instruments with whichthose targets are pursued have changed out of recognition. The main question here is

CCC 0271±2075/99/010019±11$17.50Copyright # 1999 John Wiley & Sons, Ltd.

PUBLIC ADMINISTRATION AND DEVELOPMENT

Public Admin. Dev. 19, 19±29 (1999)

*Correspondence to: Prof. P. Mosley, Director, International Development Centre, University of Reading,Reading, RG6 6AA, UK.

whether these changes pose any threat to the White Paper's poverty reductionobjective. Our answer isÐyes, unless certain options are taken up of which there is nohint in the White Paper. The discussion in the next section is at a general level, but inthe following section we home in on certain issues of particular relevance to thetraining theme: division of labour between donors, research, evaluation and ®nallytraining itself.

CHANGES IN AID TECHNOLOGY AND THEIR IMPLICATIONS FORPOVERTY REDUCTION

Table 1 illustrates the changing composition of aid ¯ow from the early 1970s to datein the case of both UK bilateral aid and, as an example of a multilateral, the WorldBank. The trends observable are, in the case of both agencies:

1 a decline (in the case of DFID a collapse) in the share of project aid;2 an increase in the share of programme ®nance;3 an increase in the share of aid to the private sector;

and in the case of the UK Department for International Development:

4 a large increase in the share of technical assistance, to the point where it dominatesthe bilateral aid programme.

Not apparent from Table 1 because of defects in the classi®cation scheme, we mayalso note:

5 a large increase in the share of aid disbursed through NGOsÐin the case of DFIDthe share has risen from near zero in 1973 to 13%1 in 1996; in the case of the

Table 1. The changing structure of bilateral and multilateral aid programmes

1973 1980 1983 1996

(a) ODA/DFIDOverall size ($m 1996/7 prices) 2299 1847 1657

Instruments (% of overall resource ¯ow)Projecta 38 17 8Programme 0 9 7Technical co-operation 33 42 51Private sector (CDC) 9 8 15Emergency 0 2 9Otherb 20 22 10

(b) World BankOverall size ($m 1996/7 prices) 15770 27356

Instruments (% of overall resource ¯ow)Projecta 82 46Programme (`adjustment lending') 0 2 23Private sector (IFC) 15 29Other 1 2

aAll `project assistance' in this cell is provided to the recipient government. bIncludes debt relief.Source: British Aid Statistics (1973 and 1983 data extracted directly from table by Maxwell (1996)); WorldBank Annual Reports.

1£166 million out of £1283 million bilateral spending (British Aid Statistics 1997, table 13).

20 P. Mosley

Copyright # 1999 John Wiley & Sons, Ltd. Public Admin. Dev. 19, 19±29 (1999)

World Bank the increase in NGO share is smaller, but still perceptible, and insome countries with weak states such as Kenya and Bangladesh a large share ofthe Bank's budget has now been handed over to voluntary organizations.

These trends do not arise from a ®t of absence of mind, but faithfully re¯ect majorcurrents in development thinking related to government failure and human capital.Strategies 2, 3 and 5 all arise from increased awareness by donors of rent-seekingtendencies within the governments of developing countries and a consequent loss ofinnocence concerning the developmental e�ectiveness of their policies; these havebeen tackled successively through voice, i.e. conditionality (in the case of strategy 2)and exit in favour of alternative development partners (in the case of strategies 3and 5). Strategies 1 and 4, by contrast, re¯ect a move from a physical capital-based toa human capital-based strategy of development,2 paralleling the shift in emphasisfrom old growth theory (whose focus was on aggregate capital accumulation) to newgrowth theory, whose emphasis is on the accumulation of human capital, as a factorof production which exercised double leverage on account of holding the key totechnical progress (Levine and Renelt, 1992). The fact that human capital, because ofits lumpiness and non-excludability,3 is traded in an imperfect market creates a casefor government intervention in knowledge creation, or, in the case of poor developingcountries, for aid intervention in the form of technical assistance; however, as we shallsee shortly, those same imperfections may create di�culties when attempting tochannel such assistance to the poor. What is certain is that aid in the form of atransfer of physical capital is on the way out. Those critiques of aid which accused itof creating `cathedrals in the desert'4 now miss their mark; aid now for the most partdoes not seek to create cathedrals, or physical structures of any sort, but to transferintangibles, principally know-how.

There is some evidence that, at the level of growth promotion, these shifts in aidtechnology have had some good e�ect. Results recently calculated by the author(Mosley and Hudson, 1996, Table 3) suggest that the partial regression coe�cient ofaid on growth, holding constant other obvious determinants of growth such assavings, human capital, export growth and other external shocks, has risen between1970±1980 and 1980±1993 from minus 0.112 to plus 0.247, signi®cant at the 1% levelin the ®rst period and at the 5% level in the second. Whereas not all of this is due tothe changes in aid instruments depicted in Table 1, our research suggests that asigni®cant component is indeed due both to policy dialogue and to the shift fromphysical capital-based to human capital-based assistance, with the declining scope forfungibility also playing a role (Mosley and Hudson, 1996, pp. 16±23). However, aidpolicy has now moved on a further stage, both in DFID and in the Bank: bothagencies, having returned to a poverty orientation, now require aid to be e�ective notonly in promoting growth, but also in reducing poverty. The question for discussionnow is whether the trends indicated in Table 1 will facilitate or inhibit the achieve-ment of this objective.

2Hewitt and Killick (1998) document this change from a physical capital-based to a human capital-basedstrategy of development in their comparison of the 1975 and 1997 White Papers.3Lumpiness refers to the di�culty of acquiring knowledge (e.g. a medical training) in discrete components.Non-excludability refers to the di�culty of charging those who acquire knowledge at the market price ofthat knowledge: much commercially valuable knowledge is passed free from person to person either byword of mouth or in writing.4The phrase of Edgard Pisani, European Union Commissioner for Development in the early 1980s.

Recent changes in aid technology 21


The ®rst thing to notice is that in the same moment as the targets of aid policy havebeen made more ambitious and more precise by the White Paper, the instruments ofpolicy have been loosened. On page 21 the White Paper speci®es a new set ofmeasurable development targets, the ®rst and most famous of which is à reduction byone-half in the proportion of people living in extreme poverty by 2015' (the othersrelate to education, reproductive health care, infant mortality and the environment).However, these targets are not to be sought by means of more precise policy orinstitutional conditionality, but rather by engaging in àid partnerships' whoseintensity will vary with the degree of the recipient's commitment to poverty reduction.Super®cially this looks like a euphemism for poverty-related conditionality, of thekind which the World Bank has practised (alongside orthodox conditionality) eversince the early 1990s, but Andrew Goudie, in his explication of the White Paper'soperational philosophy, goes out of his way to deny this, implying that conditionalprogramme aid (instrument 2 in the list above) is to be abandoned:

Some observers have interpreted `partnership' as a re®nement of the morefamiliar conditionality that has dominated much of development policy inrecent years. This is, however, a misunderstanding . . . Conditionality hastypically implied that, once a developing country has undertaken to imple-ment certain very speci®c measures and actionsÐor, indeed, has alreadyundertaken some of theseÐthen external donors would contribute®nancial resources in support of their development e�ort . . . (however)the notion of intergovernmental partnership is quite di�erent: it encapsu-lates an understanding between the partner government and the UKgovernment based upon common objectives and priorities and the sharedcommitment to pursue a long-term programme of action. It is broad-basedand more strategic in nature and not focused on highly speci®c measures(Goudie 1998, p. 173, emphasis added).

To increase the number of targets for which the government accepts responsibility,whilst at the same time reducing the number of instruments over which it exercisespower, looks on the surface either extremely risky or else disingenuous. If theachievement of the UK government's new poverty reduction targets really doesdepend on the governments of a su�cient number of developing countries comingforward with anti-poverty programmes which embody `common objectives andpriorities and the shared commitment to pursue a long-term programme of action',then the probability of achievement of the targets is very close to zero. If on the otherhand the government does intend to practise poverty-focused conditionality butprefers not to say so, then one can only ask why not. One of the undoubted gains ofthe àge of conditionality' since 1980 was that it introduced a considerable amount ofglasnost into the aid negotiation process by making transparent the conditions underwhich aid would and would not be given; to throw this transparency away, while atthe same time of course demanding more of it (White Paper, p. 21 et passim) in theinternal process of recipient governments, would appear to be a recipe for muddle of akind which would lower rather than further raise the e�ectiveness of aid operations.

Our preference, then, is for more precision in the speci®cation of pro-poordevelopment strategies, with teeth attached; but at this point one runs into theproblem identi®ed by a number of contributors to the existing symposium on theWhite Paper, namely that the strategies proposed in the White Paper are not very

22 P. Mosley


precise and su�er from, as variously expressed by contributors to that symposium,`depleted policies' or an `imprecise operational strategy'.5 Our response to this will beto put forward a possible operational strategy, in the sense of a menu of policyoptions which have shown success already in reducing poverty in some countryenvironments, and then ask how the e�ectiveness of each of these policy options islikely to be in¯uenced by the trends revealed in Table 1.

The menu is set out in Table 2, subdivided according to the level of aggregation atwhich policy measures are expected to take e�ect. It has no pretensions to being acomplete list, and many additional items could be added.

The issue for discussion is which items on this menu have a reasonable chance ofreducing poverty in DFID's target countries, taking note of the constraint that aidmade available to bring them about is likely, as shown by Table 1, to be mediated largelythrough technical assistance inputs. Our view is that two of themÐpublic employmentschemes and social safety netsÐare likely to be `self-targeting' in the sense that onlypeople below the poverty line are likely to claim the bene®ts o�ered. In all the othercases, complementary policy or institutional developments will be required to targettechnical assistance inputs e�ectively on the poor. We shall illustrate in relation to justfour of the options set out in Table 2: (3) labour-intensive growth, (8) agriculturaltechnology transfer, (10) downward extension of credit markets and (11) broadeningof access to educational and health facilities.

Labour-intensive growth

If growth already exists, giving it a labour-intensive slant requires (a) freedom fromfactor±price distortionsÐin particular subsidies to capital and taxes on labourÐand(b) the making available of labour-intensive technologies in areas where they are notwell developed, for example power generation, manufacture of electronic com-ponents, even construction in many parts of Africa. The ®rst of these is a traditionalquestion of `getting prices right', which may have to be enforced by traditionalconditionality; the second is a question of technical assistance in the form of technicalinnovation appropriate to local factor proportions and comparative advantages,which will not reach the poor if local capital markets are defective. (For example,experience in Nepal and Pakistan suggests that poor rural communities can gainaccess to electric power from micro-hydro installations only if they have access tomicro-credit in the form of small unsecured loans). In other words, making growthlabour-intensive may require donors both to impose conditionality and to create, ifthey do not already exist, complementary institutions which will target such growthon the poor.

Agricultural technology transfer

All aid donors including DFID provide substantial support to agricultural researchand extension through the international Consultative Group system, through national

5The expressions used respectively by Hewitt and Killick (1998) and by Cox and Healey (1998) in theircontributions to the March 1998 Journal of International Development symposium.



Table 2. Anti-poverty institutions and policies: a map

Level ofintervention

Approachrequired

`Recommendable' policies andinstitutions

`Best experience' cases

MACRO (1) `Minimumsocial costadjustment'

Adjust via exchange ratedepreciation, erosion of publicsector real wages, notdismissals of public servants orincreases in indirect taxes

Sri Lanka 1977±,Uganda 1987±,Mauritius 1980±82

(2) Build up`social capital'

Development of links betweencommunity organizations, andbetween these andgovernment; establishment ofreputation for trustworthinessby government

Uganda 1986±,Ghana 1983±

MESO (3) Redirectresources tolabour-intensivesectors

Avoid taxing employment;avoid subsidizing capital;promote small-scaleenterprise, GreenRevolution, primary healthand education

At an overall level,South Korea, Indonesia,Thailand, 1970±;for individual sectoralinterventions, see below

(4) `Poverty-consciousrestructuring ofpublicexpenditures'

Within sectors, target labour-intensive crops, constructionmethods, industrial and energytechnologies such as micro-hydro; support informal sector

(5) Multi-sector`social funds'

Must be demand-led;institutional autonomyrequired; co-ordination withline ministries needed;supervision and audit; learningmechanisms

BoliviaÐEmergencySocial Fund

MICRO (6) Social safetynets

Self-targeting measures such asguaranteed availability of basicfoods; also disaster relief andpreparedness

TanzaniaÐNgararefugee programme forRwandese, MalawiÐMozambican refugeeprogramme,BangladeshÐFloodAction programme

(7) Publicemploymentschemes

Labour-intensive public works BotswanaÐDroughtRelief Programme(1992), IndiaÐMaharashtraEmployment GuaranteeScheme, ZambiaÐWFP

(8) Agriculturaltechnologytransfer

Demand-led approach; includeon poor people's crops, e.g.sorghum and millets, but alsohigh-value crops, e.g.horticulture; n.b.complementary extension and®nancial services for low-income groups also required

Indonesia, China 1976±,India and PakistanPunjab, Zimbabwe1981±85, some Kenyandistricts

Table 2. Continued over page

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research and extension systems and increasingly through NGOs. This support hassubstantial potential for poverty reduction, particularly in Africa, through theadoption by small farmers of the yield-increasing varieties of foodcrops (especiallymaize, sorghum and cassava) produced by these institutions and through thedevelopment of rural industries stimulated by these yield increases. Although thereare no technical barriers to the adoption by small farmers of these `green revolution'varieties, there may well be labour market and capital market barriers, since thesevarieties need more labour and more inputs ( fertiliser, pesticide and irrigation water)than traditional varieties; and institutional reforms (in particular micro®nance) willbe needed to overcome these barriers. In addition, farmers will not be motivated toinvest in yield-increasing varieties unless they can get a decent price for their crop,which in some African countries still requires the dissolution or reform of agovernment foodcrop monopoly. In other words, the implementation of agriculturaltechnology transfer, like labour-intensive growth, in a manner which bene®ts poorpeople may require both policy conditionality and the setting up of complementaryinstitutions, especially at the bottom end of the market for labour and ®nance.

Downward extension of credit markets

The increasing involvement of donors in supporting the `micro®nance revolution' hasbeen based on a belief that it is self-targeting, on the premise that only poor people

Table 2. Continued

Level ofintervention

Approachrequired

`Recommendable' policies andinstitutions

`Best experience' cases

MICRO (9) Assetredistribution

Land reform, blended withpro-poor research, ruralinfrastructure reform, anddevelopment of market outlets(n.b. complementary factors ofproduction such as waterrights can also be transferred)

MalaysiaÐFELDA oilpalm and rubbersettlement schemes,South Korea andTaiwan, South Africa1994±?, Proshika(Bangladesh)

(10) Downwardextension ofcredit markets

Group lending; `incentives torepay'; built-in insurance andsavings; in agriculturalschemes, drought insurance avaluable complement

Group schemes:BangladeshÐGrameenBank and BRAC,BoliviaÐK-REP Juhudiand PCEA Chogoria,CameroonÐmc2.Individual schemes:IndonesiaÐBRI, BKKand other regionaldevelopment bankschemes, RussiaÐSmallBusiness Fund

(11) Broadeningof base ofeducational andhealthprogrammes

Priority to primary sector; pro-female bias



will apply for very small loans, but this belief is ill-founded (Hulme and Mosley,1996): richer people do happily apply for micro-loans if it will lower the cost of®nancial services to them, and as lending institutions develop and average loan sizesincrease, the ability of lending institutions to target loans on the very poor diminishesstill further. The achievement of e�ective poverty focus will depend on institutionaldevelopments of the following type:

(i) the o�er of savings facilities, often more needed by the extremely poor thanborrowing facilities (Rutherford, 1998);

(ii) the o�er of consumption loans with a ¯exible repayment schedule, often neededby the poor more than investment loans (Montgomery, 1996);

(iii) variable interest rates related to loan size, coupled with pro®t-related incentivesto sta�, which will motivate the sta� of lending institutions to provide very smallloans targeted on the very poor;

(iv) institutional developments which reduce the risk associated with investing intraditional production systems, such as drought insurance.

All of these are currently implemented by only a tiny minority of the 10 000 or soinstitutions currently active in micro®nance, with the implication that the currenttargeting potential of micro®nance operations is poor. Without institutional develop-ment of the type described in (i)Ð(iv) above, technical assistance in micro®nance andsmall business development, although badly needed to prop up many of the otheractivities, may have limited success in poverty reduction.

Broadening of the base of educational and health services

This is a standard aid donor's approach to poverty reduction; indeed, White (1998,p. 162) claims that it is standard DFID practice to `focus aid on (education and healthsectors) where the government is not poverty focused, and to disburse sectorassistance where it is so', putting the main weight of poverty reduction e�orts in suchcountries on this one policy instrument. Unfortunately this is not a valid self-targetingstrategy, even if (as in the case of DFID and most donors) aid is centred on theprovision of primary education and health facilities. The Kenya poverty audit by thepresent author and Joseph Mullen (Mosley and Mullen, 1997) found that even in thethree districts with the highest concentration of poverty, Machakos, Samburu andIsiolo, only 31% of users of aid-®nanced primary health and education facilities werebelow the poverty line, even though 78% of households are estimated to be below thepoverty line. The ability of aid to target primary health and education facilities on thepoor has deteriorated with the introduction of user charges. In such a situation thestrategy of focusing aid on primary health and education, although correct from thegeneral developmental point of view, probably cannot be expected to make directinroads into the standard of living of the very poor. It is possible that a strategy ofincreasing the share of education and health facilities that is provided through theNGO sectorÐsuch as is currently being practised by DFID in KenyaÐmight help toincrease the degree of self-targeting, but the data are not good enough to con®rm ordeny this.

26 P. Mosley


CHANGES IN AID TECHNOLOGY AND THEIR IMPLICATIONS FORAID PROCEDURES

Implementation of the White Paper's goals in the wake of the changes which the aidprogramme has undergone, then, requires much more precise speci®cation of policyand institutional actions by actors in the recipient country than has so far been madeavailable. However, it also requires speci®c actions, not mentioned by the WhitePaper, to be taken by donors. Again, all that is possible here is to provide examples.We shall do this in increasing order of generality, starting with the training activitieswhich are the subject of this symposium.

Training activities in industrialized and developing countries accounted for £150m,or some 22% of the dominant technical assistance component of the DFID aidbudget in 1996, and hence for 12% of the bilateral aid programme overall (British AidStatistics 1996, Table 7). 100% of the direct recipients of such training are above thepoverty line; in other words, aid in the form of training depends entirely on indirecte�ects, such as the ability of trainees to design or improve policies and institutionswhich reduce poverty, for its e�ectiveness in this direction. This as such is not aproblem; what is a serious problem is that such e�ectiveness has never been seriouslyassessed. It is not mentioned in the White Paper or in the main review of developmenttraining in the recent past, the `Power of Change' report (United Kingdom, 1992).6 Itis true that since 1993 PIMS markers7 have been attached to all DFID-®nancedprojects at appraisal, and these give training projects a `poverty mark' of 29%, butthis ®gure is meaningless; it is an ex ante assessment based on hunch and intuition,not an ex post evaluation based on analysis of even a single project. What needs to bedone is not only to follow through the impact of training on on-the-job performance,as currently required, but also to measure the extent to which the institution iscontributing to poverty reduction; information which in some cases, for example inmicro®nance and health, can be taken ò� the shelf' from earlier evaluation work.

The ful®lment of the White Paper's objectives, indeed, will require a recasting of itsentire evaluation e�ort, not just in the ®eld of training. Evaluation work is currentlyfocused on the calculation of proximate e�ects of individual projects and the feedingback into management of lessons from these projects; calculation of the impact ofprojects and programmes on ultimate targets, whether growth, macro-economicstability, infant mortality, literacy or, in the present case, income distribution andpoverty, tends not to fall on the evaluation budget. Yet it can hardly fail to do sowhen the White Paper, as discussed, has committed itself to a range of precise targets,starting chronologically with èliminating gender disparity in primary and secondaryeducation by 2005' and by this and other means achieving à reduction by one-half inthe proportion of people living in extreme poverty by 2015' (DFID, 1997, p. 21). The

6The Power of Change' report has a page and a half on evaluation, within which paragraph 8.10 asks thequestion `What indicators of impact should be used?' The question is answered in terms of four criteria: (a)the ability of trainees to carry out relevant tasks; (b) high retention rates for returned trainees within theirinstitution; (c) reductions in the number of sta� vacancies and the number of expatriate sta�; (d) informeddemand for further training that will support and reinforce that already provided to earlier trainees.Neither in this paragraph nor elsewhere in the report is the poverty reduction objective mentioned.7Project Implementation Monitoring System: a computer-based scheme for providing a summary descrip-tion of the composition, and current quality, of the donor's portfolio. Relevance of the project to thepoverty reduction objective (and to other policy objectives) is assessed at appraisal on the scale: 0, norelevance; 2, some relevance; 4, major relevance.



focus of the evaluation e�ort will have to shift to answering the question whetherwhole sectors of the aid programmeÐrather than simply individual projectsÐaretaking the economies of recipient countries towards those targets, and in general howmuch of any progress in this direction should be ascribed to the aid programme inrelation to other factors (such as world price and weather trends) Within this context,comparative studies of alternative aid technologiesÐalong the lines of the WorldBank's Annual Review of Project Performance Audit ResultsÐand of their relativee�ectiveness in achieving particular targets will become important. The matter isparticularly urgent in the context of the White Paper, since there is currently noproject in the past or present DFID portfolio on which poverty impact has beenrigorously assessed. The policy analysis e�ort of the World Bank has already beentaken in this direction by an earlier idealistic leader announcing a drive againstpoverty (Robert McNamara in 1973); DFID now needs to emulate it.

As documented in Table 1 above, and as explicitly argued on behalf of the WorldBank by many people on the occasion of its recent golden jubilee, the centre of gravityof development agencies worldwide is gradually shifting from the ®nance provider tothe knowledge provider role. All agencies are doing this; but each in its own way, withrelatively little communication, collaboration or (alternatively) specialization inrelation to the others. Part of this point is made by Cox and Healey (1998, p. 231)when they stress how much can be learned from the e�orts of (say) the Swedes and theDanes in the poverty reduction area, with the implication that the possibilities forcollaboration have been missed by the White Paper. There is, however, not only theopportunity to collaborate, but also to relinquish to quali®ed donors those parts ofthe aid e�ort which they do best. Within the market for knowledge it is not yet clearwhether any bilateral development agency has decided where its comparativeadvantage lies; certainly there is no evidence from the White Paper that DFID hasdone so, either in terms of sectors or in terms of recipient countries (with theexception of the positive incentives mentioned earlier (DFID, 1997, p. 38) in favour ofunspeci®ed countries `committed to the elimination of poverty and pursuing sensiblepolicies to bring that about'). The consequence of this is that all donors are trying todo everything, and this is unlikely to lead to e�ciency in the provision of aid, anymore than it would lead to quality of provision if every restaurant in a city attemptedto provide Italian food, and also Chinese, and Indian, and French, and all the otherspecialities available. For DFID to announce now that it intended to specialize in(say) support for agriculture, education, health and small business in Africa might bea possible approach, especially in the light of volume commitments that have alreadybeen made;8 but if there is to be a rational division of labour, any such decision tospecialize should not be made in advance of discussionsÐindeed contractualnegotiationsÐwith bilateral partners.

In our judgement, therefore, the noble vision of the White Paper needs to bebuttressed by overt conditionality at the macro level, and by institution-buildinge�orts as detailed in Table 2 which take note of the changes in the structure of aidprovision which limit the ability of aid programmes to self-target poor bene®ciaries.As with the social safety nets of industrialized countries, both e�ciency and equityrequire more selectivity. The balance between the instruments of Table 2 will vary

8In July 1997 the Prime Minister committed DFID to raise by 50% the level of its bilateral spending onbasic health care, basic education and clean water in Africa (DFID, 1997, p. 23).

28 P. Mosley


according to local circumstances as speci®ed in country strategy papers, but the needfor a greater measure of deliberate targeting than is apparent in the White Paper islikely to be a common theme.

REFERENCES

Cox, A. and Healey, J. (1998). `The 1997 White Paper: powerful poverty commitment,imprecise operational strategy', Journal of International Development, 10, 227±235.

Department for International Development (DFID, UK) (1997). Eliminating World Poverty:A Challenge for the 21st Century. Cm 3789. The Stationery O�ce, London.

Goudie, A. (1998). Èliminating world poverty: a challenge for the 21st century. An overviewof the 1997 White Paper on international development', Journal of International Develop-ment, 10, 167±185.

Hewitt, A. and Killick, T. (1998). `The 1975 and 1997 White Papers compared: enriched vision,depleted policies?', Journal of International Development, 10, 185±195.

Hulme, D. and Mosley, P. (1996). Finance against Poverty, Vols 1 and 2, Routledge, London.Levine, R. and Renelt, D. (1992). À cross-country sensitivity analysis of growth regressions',American Economic Review, 82, 942±963.

Maxwell, S. (1996). Àpples, pears and poverty reduction: an assessment of British bilateralaid', IDS Bulletin, 27, 109±121.

Montgomery, R. (1996). `Disciplining or protecting the poor?', Journal of InternationalDevelopment, 8, 289±305.

Mosley, P. and Hudson, J. (1996). `Has aid e�ectiveness increased?', University of ReadingOccasional Papers in Development Economics, 31.

Mosley, P. and Mullen, J. (1997). `Kenya poverty audit', DFID Eastern Africa DevelopmentDivision, Nairobi.

Rutherford, S. (1998). `The savings of the poor: improving ®nancial services in Bangladesh',Journal of International Development, 10, 1±17.

United Kingdom (1992). `The power of change. Part 1: A review of training: needs and criteria(`Ìredale report''). Part 2: Training for the private sector', Overseas DevelopmentAdministration, November.

United Kingdom (1997). `Second report from the House of Commons InternationalDevelopment Committee: the Development White Paper', House of Commons Paper 330,16 December.

White, H. (1998). `British aid and the White Paper on international development: dressing awolf in sheep's clothing or the emperor's new clothes?', Journal of International Develop-ment, 10, 151±167.



Recent changes in aid technology: is the White Paper an adequate response?

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