by William Easterly, Professor of Economics at New York University and Co-director of the NYU Development Research Institute
by Norman Loayza, Director of the Global Indicators Group, World Bank
by Marcello Estev?o, Global Director of Macroeconomics, Trade and Investment (MTI) Global Practice, World Bank
How does conflict influence which countries with good or bad governance receive official development aid flows? What is the effect of aid on conflict? The foreign policy objectives of the largest donors ¨C especially the U.S. ¨C play a large role in how these questions turn out. During the period when US foreign policy was dominated by the War on Terror (2001-2021), foreign aid increased the fastest to countries in conflict and to the most authoritarian states. Evidence during this period indicates that aid on average made conflict worse. The end of the War on Terror and the onset of the War in Ukraine marks a new phase in which U.S. foreign policy now prioritizes support of democratic states. There is hope that aid to countries in conflict may now have a more positive role.
Marcello de Moura Estev?o Filho is the Global Director of the World Bank Group¡¯s Macroeconomics, Trade and Investment Global Practice (MTI). Before joining the Bank, Mr. Estev?o was Deputy Minister for International Affairs at the Ministry of Finance in Brazil until end-December 2018 and served as Brazil¡¯s G20 Deputy. He also served as the Chairman of the Board of Directors of the New Development Bank (Shanghai) and member of FUNCEF¡¯s Board of Directors. Prior to this position, he worked at Tudor Investment Corporation as the chief-economist for North America and Oceania; at the International Monetary Fund (IMF) as mission chief to Peru, Nicaragua and Barbados, and deputy chief of the Regional Studies Division, the North American Division, and the Latin-Caribbean Division.
Norman Loayza is Director of the Global Indicators Group at the World Bank. Previously, he was a Lead Economist in the Development Research Group and managed the Asia hub of the Research Group, based in Malaysia. He was director of the World Development Report 2014, Risk and Opportunity: Managing Risk for Development. His research has dealt with various areas of economic and social development, including macroeconomic management, economic growth, microeconomic flexibility, private and public saving, financial depth and stability, natural disasters, and crime and violence. His advisory experience at the World Bank has also ranged across different topics in various regions and countries.
