This is an *old* paper (2012) that I submitted to CGD for peer review and it got shot down. I can’t remember why, and I re-used some of the material in Results not Receipts but it has some interesting data in it and I still think I broadly agree with it so, with that caveat lector, here it is. For many donors throughout most of their history, the major assistance model has involved the tool of the investment project. This is based on a theory of aid and development that the key constraint facing developing countries seeking rapid growth is lack of investment and that donor financing to overcome that ‘investment gap’ can be overseen through the project process to ensure that it is efficiently spent to generate high returns. In reality, filling an ‘investment gap’ is neither an empirically well justified nor a practically well-implemented aid strategy. Furthermore, procurement oversight mechanisms appear to be doing a poor job at ensuring the average effectiveness of an investment portfolio in a country is significantly enhanced, or transferring knowledge, or building institutions. The procurement-focused project investment model should be limited in use to in cases where (i) a project design is significantly innovative and/or delivers regional or global public goods and/or aid is a large percentage of country investment and no agreement can be reached between donors and government on overall investment priorities in that country and (ii) alternate project approaches like output-based or cash on delivery models are deemed inappropriate.
Charles Kenny
Books, Papers and Articles
Charles Kenny writes about global development — what’s working, what isn’t, and how the world can do better. An economist who spent fifteen years at the World Bank, he is now a senior fellow at the Center for Global Development in Washington, DC.
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A CGD blog. The IFC isn’t finding more private sector projects to support in IDA countries even with the backing of both PSW financing and retained earnings used to hire more staff to look for projects. Absent actual projects to invest in, PSW resources are increasingly committed to regional and global faciliti…
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A CGD blog with Samuel Huckstep. COP27, just concluded in Sharm El-Sheikh, was dubbed the ‘implementation COP’ by its Egyptian hosts. But it’s very difficult to implement without workers. The COP27 agreement emphasises that a “just and equitable transition” must include “workforce and other dimensions.” This short, vague language c…
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A CGD blog. The Open Contracting movement, pushing to make government procurement worldwide considerably more transparent and efficient, has been a huge success. Today, more than 50 countries and cities are implementing policy changes from open electronic bid processes and publishing contracts to posting inspec…
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A CGD blog. Last month, I spent an enjoyable if fractious couple of days in Vienna, taking part in a meeting of the UN Office of Drugs and Crime 2nd Task Force on the Measurement of Corruption. The task force is meant to help the office “define and refine methodologies for measuring corruption and to formulate …
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A CGD blog with Samuel Huckstep. The UK currently has a shortage of nearly 47,000 nurses in the NHS a Global Skill Partnership could help solve NHS staff shortages. The UK will gain much-needed skilled nurses at a cheaper cost than if they had been trained in the US, while the sending country benefits from nurse training that cove…
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A CGD note. The long run global estimates of climate impact on GDP are small. That hides the fact that there are big volatility shocks and impacts are concentrated in poorer countries. And that matters a lot for policy response.
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A CGD Working Paper with George Yang. There is considerable interest in increasing private participation in infrastructure to meet the twin goals of climate mitigation and development in low- and middle-income countries. At the same time, this infrastructure needs to make returns in order to be financially sustainable. This paper reviews evidence on the economics of infrastructure investment and the role of human capital and uses two approaches to provide additional evidence on the link between human capital and infrastructure returns: (i) using estimated returns to individual World Bank infrastructure projects and their relationship to country levels of human capital and (ii) broader approaches linking the macroeconomic impact of infrastructure investment in the presence of varying human capital stocks.
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A CGD blog. It is worth emphasizing that a healthy population is needed to produce the workforce that will generate economic returns from new infrastructure capacity. The relationship between health and economic dynamism runs in both directions, and that includes with infrastructure.
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A CGD blog. The kind of investment sustainability that’s getting the most love at the moment is environmental sustainability: we want our buildings, machines, and infrastructure to be low carbon (as we should). But financial sustainability still matters, too: if they are to be a success, solar power plants and …
