Separate Types, Separate Intent: American Foreign Aid Policy Leonard N. Chan Rice University Department of Political Science Under the Direction of Cliff Morgan, Ph.D.

What is Foreign Aid? Development Assistance Committee of the Organization for Economic Cooperation and Development (OECD): financial flows, technical assistance, and commodities that are (1) designed to promote economic development and welfare as their main objective (thus excluding aid for military or other non-development purposes); and (2) are provided as either grants or subsidized loans Hans Morgenthau (1962): transfer of money and services from one government to another

Purpose of Foreign Aid Idealism: Humanitarian concerns as the cornerstone Neo-Marxism: Economic-driven model of subjugation Realism: Security-driven motives

Systematic Issues in Theory Difficulty in formulating a general theory behind donor state programs due to varied motives as seen in case studies: Japan, France, Sweden, and the United States Cold War-driven explanations obsolete Common thread in ideology

The American Ideal Political ideology instead of economic ideology: the consolidation and spread of democracy $700 million devoted annually toward democracy-building programs The value of democracy

The American Ideal The United States can either help introduce or consolidate democracy Limited resources to pursue these objectives Parallel to Palmer and Morgan’s Two-Good Theory: Promotion of Democracy (Change) and Consolidating Democracy (Maintenance)

Varied Instruments According to the Two-Good Theory, separate foreign policy instruments have different purposes although some may be interchangeable Despite foreign aid labeled as a change- inducing mechanism, many forms of foreign aid options available

Typography of Foreign Aid Hans Morgenthau formulates the types of foreign aid and their purposes –Humanitarian –Subsistence –Military –Bribery – Economic Development –Prestige

Typology of Foreign Aid Not mutually exclusive Purposes cross-over Intentional mis-labeling

Hypotheses Assumption: United States desires democracies but can only influence states that can be affected by aid H1: Different factors drive the allotment of the varied types of foreign aid H2: Change-seeking foreign aid will be rewarded at relatively higher rates in non-democracies H3: Maintenance-seeking foreign aid will be rewarded at relatively higher rates in democracies

Data and Methodology Data Foreign Aid Data: U.S. Greenbook Democratization: Freedom House, Polity Recipient State Information: CIA Factbook Methodology Cross-section ordinary least squares (OLS)

Results

Potential Issues The first set of analysis treats economic aid as an aggregate of many accounts Morgenthau: economic development and subsistence aid are distinct Food aid and economic development aid can be parsed out

Results: Food Aid v. Economic Development Aid Sub-Saharan Africa

Conclusions Different mechanisms in play Unexpected, but previously supported, results in the effect of wealth on foreign assistance If Morgenthau is correct, the United States acting against its best interests

Possibilities Need to understand the differences: better specification of the model, checking the impact of other variables, using time-series data, etc. Two-goods: –Maintenance and change, or –Humanitarian and self-interest