Two views, founded on divergent rationales, have been used to explain the allocation of official bilateral aid. One view explains the allocation of aid in terms of the humanitarian needs of the recipient, the other in terms of the foreign policy interests of the donor. Although the foreign policy view is now clearly dominant, it has not been developed systematically. This paper initially develops an analytic foreign policy model of aid allocation. The model suggests that the provision of aid leads to the establishment of commitment and dependency, enabling the donor to realize certain foreign policy utilities. These utilities in turn allow the donor to pursue its interests. These interests may be ordered into five substantive foreign policy models. The main research objective of the paper is to test these models in the context of U.S. aid by making a cross-national, longitudinal study of the distribution of U.S. aid over the years 1960- 1970. We find that the foreign policy model which best explains the allocation of U.S. aid is one that is consonant with the political interpretation of imperialism.
As a consequence of Truman's Point Four Program of 1949, the provision of economic assistance to independent low-income countries became the official policy of the United States. In the early and mid-1950s economic development assistance, though growing, received relatively little attention as the Korean war turned the USA's foreign aid in the direction of military assistance. However, by the start of the 1960s, the transfer of economic assistance from high-income to low-income countries had developed into an institutionalized relationship. Economic assistance was clearly distinguished from military assistance and administered separately; the USA's monopoly of aid was decreasing as other high-income countries, partially under the USA's pressure, were establishing their own aid programmes; and the volume of aid and the number of recipients were increasing.
The overriding conclusion of the majority of recent policy studies is that political factors play an insignificant role in influencing policy outputs. We establish a number of models, comprising both economic and political variables, which are used in an attempt to indicate the relative salience of rival determinants of public welfare commitment in advanced democratic states. Though we cannot dismiss some influence of economic factors, the main findings run counter to the conventional wisdom of policy studies in indicating the greater salience of political factors as determinants of public welfare outputs.
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