problems involving the engagement of stakeholders and beneficiaries. Financing issues relate to problems with procurement, budgeting, auditing, and other financial management issues. Lastly, issues with monitoring and evaluation focus on the absence of adequate indicators and data baselines for tracking development objectives and identifying potential problems as they evolve.

In the stakeholder cluster, challenges were grouped according to problems of coordination, leadership, and organizational capacity. Coordination and engagement challenges assess difficulties related to administrative and bureaucratic hurdles, ambiguous assignment of responsibilities, and insufficient communication between Bank staff and project beneficiaries. Leadership challenges address shifts in government priorities and opposition to proposed interventions by beneficiaries. Lastly, human resource challenges examine the availability (or absence) of requisite skills, staff turnover, and weaknesses in skill transfer.

The third cluster catalogs the various contextual challenges practitioners faced in carrying out their development objectives. The eight categories defined here (legislation, governance, conflict, societal issues, environmental concerns, natural disasters, business environment, and macroeconomic context) appraise the various internal and external factors that impacted practitioners’ implementation of the project. Some of the challenges (e.g. those involving natural disasters, economic shocks, or civil unrest) are exogenous to implementation, but their inclusion provides a useful set of contextual controls against which the impact of delivery challenges can be tested. Figure 1 graphs the distribution of all delivery challenges by project sector and Figure 2 shows the average number of challenges per project as disaggregated by region. The heterogeneity among sectors and regions of implementation shown there will be addressed in the analysis.

The delivery challenges themselves were extracted from over 1,500 World Bank Project Implementation Completion Reports (ICRs). Word clouds, n-grams, and manual reviews were used to create a training set for supervised analysis. These were paired with annotated summaries that associated text labels to the different challenges. The combination ensured that no pertinent categories were missed in classification. A training set of over a thousand manually classified project completion reports was prepared, integrating output from the annotated summaries and unsupervised cluster analysis. This was evaluated using expert interviews in order to confirm its validity. After accounting for spelling errors, stemming, and removing stop-words, K-means clustering was employed on all available ICRs, yielding the first version of the dataset. Cluster dendrograms were then used to cross-validate the output against the categories identified in the literature and practitioner interviews. Ultimately, the output categories were shown to correspond rather closely to theoretical concepts reflected in the literature.

The resulting taxonomy of delivery challenges serves as a comprehensive diagnostic tool for understanding the Bank’s performance as well as the achievement of project objectives. That being said, the taxonomy’s prioritization of implementation problems over country- and sector-specific heterogeneities presents a potential issue for calculating unbiased and consistent estimates. As will be shown in Section 4, this is addressed using a battery of control variables designed to capture the impact of unique sectoral, regional, and loan-type effects. In addition to controlling for baseline factors such as gross domestic product, population, financial health, foreign debt, and industrialization, additional contextual covariates were included to capture attributes of project performance that might have otherwise been linked to regime type, urbanization, natural resource rents, former colony status, and the quality of project leadership. However, inclusion of these indicators ultimately had a limited impact on outcomes.

The relative representation of challenges may pose a further obstacle for analysis, as certain issues 8