‘The Aid Effectiveness Agenda: The benefits of going ahead’- A commentary on the final report

Working and discussion papers
April 2012
Annalisa Prizzon and Romilly Greenhill

The report, The Aid Effectiveness Agenda: The benefits of going ahead, estimates the monetary gains deriving from the implementation of the Paris Declaration (PD) and the Accra Agenda for Action (AAA) by the EU and EU member states. The aim is to help donor agencies to weigh the costs and benefits of implementing this agenda.

This short note presents the key findings of the study and provides a commentary on the methodology used. In summary, this paper finds that:

  • The estimates provided on the direct benefits of implementing the PD (€ 3.2 billion) are broadly robust, although with some caveats.
  • The estimates on the indirect benefits (€ 1.8 billion) should be treated with caution, due to weaknesses in the model used.
  • The large hypothetical gains from aid reallocation to maximise poverty reduction (€ 7.8 billion) provide a broad ‘rule of thumb’ on the magnitude of potential benefits, although with some caveats.
  • The study only covers a narrow sub-set of the PD and AAA commitments. As a result, the direct benefits are probably significantly under-estimated.

This commentary proceeds as follows:

  • Section 2 summarises the main five issues covered by study and provides a brief outline of the methodology.
  • Section 3 reviews the methodology used to quantify the benefits under these five headings.
  • Section 4 provides a more general critique of the paper.
  • Section 5 concludes.
  • A comparison with some previous studies is included as Annex 2.
  • Annex 3 invites two of the original authors - Sven Tengstam and Arne Bigsten - to respond to the questions raised in this paper with their ‘Comments on the Commentary’.
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