A quantitative framework for foreign aid allocation in the post-Cold War period

While there have been many studies of the determinants of bilateral and multilateral foreign aid, these studies have come in three fairly distinct waves with discrete understandings of the historical context of foreign assistance. The first wave of research focused on post-WWII aid from the U.S. to Europe (Marshall Plan); the next wave studied the role of colonial heritage as a determinant of aid to newly independent nations and the expansion of international aid mechanisms; the third wave has focused on aid in the post Cold War era. In this paper, I investigate the degree to which foreign aid levels are determined by a recipient country's economic and physical needs, civil rights and political rights, political terror and violence, and government effectiveness using new years of data that have not previously been studied to determine if the break-down of the Cold War geopolitical framework has affected foreign aid decisions. I conclude that while recipient needs, civil and political rights, and government effectivness are significant factors in foreign aid decisions, the levels of recipient country political violence and governmental independence have become increasingly important elements in determining donor country foreign aid levels.