humanitarian and other components of aid are excluded that are not intended to further short-run growth. Third, instead of looking at final outcome measures such as economic – – growth for which aid might only represent a weak signal (Roodman, 2007) we take as the dependent variable what World Bank country teams are attempting to achieve when they design DPLs, i.e., the quality of development policies. And finally, the time period under investigation is different. Most research evaluates the first two decades of adjustment lending. However, as mentioned in section 2 the practice of development policy lending evolved substantially over time, particularly since the end of the 1990s. The more positive results in our study suggest that the World Bank’s claims about learning from its mistakes with traditional adjustment lending have some validity.

# **Acknowledgement**

We would like to thank Vincenzo Verardi, Adam Wagstaff, Peter Moll, Patricia Geli and the seminar participants at the 2013 LAGV conference for useful comments and suggestions. Lodewijk is also indebted to the Institute of Development Policy and Management (IOB) and the Research Foundation Flanders (FWO) for financial support.

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