The political economy of budget support

8 April 2011 10:00 - 13:00 GMT+01 (BST)

David Booth
Nadia Molenaers


The European Commission Green Paper on budget support discusses the case for introducing political conditionality. Yet recent evidence calls into question the usefulness of this approach and reconfirms prior knowledge on the effectiveness of conditionalities. One explanation is that those designing and implementing budget support operations fail to sufficiently account for the incentives that such operations create, as well the exogenous incentives faced by the key players.  Understanding this better might help improve operations, and explain why some of the big asks of budget support operations are just too big.

This session explore the incentives both recipient countries and donors face in implementing budget support. It included and went beyond examining the incentives surrounding conditionalities, exploring how the budget support agenda is generated and managed.