Martin Skladany’s scientific contributions

This article proposes a novel form of foreign aid—macro aid. Under macro aid, developing countries that are aid recipients would be self-organized into groups and held collectively responsible for stolen or negligently wasted grants. If such abuse occurs, all developing countries in the group would no longer be eligible for any additional aid from the same funding source. Such shared responsibility would build powerfully constructive pressure among developing countries to not abuse aid. Moreover, the public nature of the program would enhance transparency, strengthen expectations, motivate citizens to demand that all group countries live up to the international attention, and shine a spotlight on aid agencies to prevent them from continuing to tolerate systemic corruption. Macro aid programs could also be set up within developing countries at the regional or local governmental level. Further, developing countries could voluntarily decide to establish macro aid groups to signal to domestic and foreign investors their resolve to reform. If such a high level of accountability is expected from the poor who are enrolled in microcredit programs that require group repayment, it is reasonable that the same level of responsibility and oversight should also be applied to groups of elite politicians in developing countries.

Existing best practices for aid delivery are well known and largely uncontroversial but often neglected by bilateral and multilateral aid agencies because of domestic political considerations and bureaucratic resistance. Developing countries should unilaterally ratify an agreement committing them, in the future, after they have experienced sustained and robust economic, social, and political development, to establish their own foreign aid programs that follow existing best practices for aid delivery. Such foreign aid reciprocity agreements would have numerous benefits, including: being an international tool to signal a developing country’s resolve to reform and a domestic tool to pressure corrupt public officials to improve; enabling developing countries to take a leadership position in international development discourses; putting pressure on developed countries to implement best practices; and encouraging other developing countries to support and eventually adopt aid reciprocity agreements, which would lead to an increase in the amount of aid in the future. Furthermore, the idea of unilateral reciprocity agreements could potentially be expanded to areas of international interaction beyond foreign aid such as finance, trade, security, technology transfer, migration, and environmental policies.