Foreign aid and policy concessions

Bruce Bueno De Mesquita, Alastair Smith

    Research output: Contribution to journalArticlepeer-review


    We model foreign-aid-for-policy deals, assuming that leaders want to maximize their time in office. Their actions are shaped by two political institutions, their selectorate and winning coalition. Leaders who depend on a large coalition, a relatively small selectorate, and who extract valuable policy concessions from prospective recipients are likely to give aid. Prospective recipients are likely to get aid if they have few resources, depend on a small coalition and a large selectorate, and the policy concession sought by the donor is not too politically costly. The amount of aid received, if any, increases as the recipient leader's coalition increases, the selectorate decreases, the issue's salience increases, and the domestic resources increase. The theory explains why many Third World people hate the United States and want to live there. Empirical tests using the U.S. Agency for International Development data for the postWorld War II years support the model's predictions.

    Original languageEnglish (US)
    Pages (from-to)251-284
    Number of pages34
    JournalJournal of Conflict Resolution
    Issue number2
    StatePublished - Apr 2007


    • Foreign aid
    • Policy concessions
    • Political economy
    • USAID

    ASJC Scopus subject areas

    • General Business, Management and Accounting
    • Sociology and Political Science
    • Political Science and International Relations


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