Planners vs. searchers in foreign aid

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In this ADB lecture, William Easterly once again criticizes the central planning of the aid industry, and in particular the UN institutions – including the World Bank. He favors a bottom-up approach led by searchers. (He labels us planers.) I agree with some of his arguments, though soon grew tired of this ‘planers vs. searchers’ imagery. What about doers? Also, I would venture that the industry will actually continue to become more fragmented (and competitive?).

One part that caught my attention was his suggestion for reforming current incentives and improving accountability:

Fix the incentive system of collective responsibility for multiple goals. Have individual accountability for individual tasks. Let aid agencies specialize in the sectors and countries they are best at helping. Then hold the aid agencies accountable for THEIR results by having truly independent evaluation of their efforts. Perhaps the aid agencies should each set aside a portion of their budgets (such as the part now wasted on self-evaluation) to contribute to an international independent evaluation group made up of staff trained in the scientific method from the rich and poor countries, who will evaluate random samples of each aid agency’s efforts. Evaluation will involve randomized controlled trials where feasible, less pure statistical analysis if not, and will at least be truly independent even when randomized trials and statistical analysis are not feasible. Experiment with different methods to just ask the poor if they are better off.

ODI also favors a bottom-up model and I'm all for more experimentation with randomized trails - though see Peter's points. (Ht to TradeDiversion)

Update: Lots of praise for the paper over at ASI, Curious and the Social Change Project.

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