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Overseas Aid in the Dragons' Den

This case study is adapted from materials shared on the TRUE wiki for Development Economics. Dr Smith's supporting materials are available under a Creative Commons Attribution-Noncommercial licence via the links below.

The idea underlying this interactive class session is to get students to think about some of the key issues surrounding the provision of overseas aid.

Before the session, students are asked to watch a brief narrated PowerPoint presentation (provided on the VLE in Windows Media Player format), and to consult key chapters in the main text books for the module.

At the beginning of the session, the students are divided into these groups:

  • Country A: a low-income country in sub-Saharan Africa.
  • Country B: a lower-middle-income country in Southeast Asia
  • Country C: a high-income country in Western Europe
  • The World Bank
  • A Non-Governmental Organisation

With relatively small numbers, I usually omit the NGO group.

Each group is given a briefing document describing the characteristics of the groups and objectives of their group (see separate file).

Countries A and B are the potential recipients of overseas aid. These countries should not see the briefing documents provided to the other groups. However, the rich country, World Bank and NGO should receive the documents relating to the two potential recipients – but not those for the other potential donors.

After a period of preparation, the two less-developed countries A and B give their pitch to the other 3 groups, making a case for why they should receive aid. The other groups should be given the opportunity to cross-question the two potential recipients. The session ends with Country C, the World Bank and the NGO awarding their aid to one of the countries, and explaining why they took that decision. They may need 5 minutes to discuss this before announcing their verdicts.

The outcome is that although Country A is clearly in more need of aid, it rarely receives it from either Country C or the World Bank, and only sometimes from the NGO. This result arises from the pattern of characteristics assigned to these three potential donors in terms of their objectives and accountability.

Timing can be tight. A typical session in 2008/09 ran as follows:

  • Country A presentation started 20 minutes in, followed by Country B 3 minutes later.
  • Cross-questioning took an average of 4-5 minutes per group.
  • A and B were then given 1 minute each to make a final appeal.
  • The donors consulted amongst themselves for about 2 minutes, and then gave their final decisions.

This just about squeezed the session into a 45 minute slot. An extra 5 minutes to underline the outcomes would have been good, and perhaps the initial preparation could have been a little shorter to allow for this.

© Peter Smith, October 30, 2009
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