robust. A similar result to McGillivray’s appears when looking at World Bank lending alone Butkiewicz and Yanikkaya (2005).

34 Doucouliagos and Paldam (2005c). That aid is at least sometimes associated with better performance may make aid a stronger contender for additional funding that debt relief in terms of growth impact ($100 billion in debt relief for low income countries to date does not appear to have altered public spending, investment rates, the quality of policies and institutions or growth outcomes according to Kraay and Chauvin, 2005).

35 Clemens, Radalet and Bhavni (2004) argue that budget and balance of payments support, investments in infrastructure and aid for productive sectors does appear to have a short-term impact on output, with a $1 increase in aid raising output (and income) by $1.64 over four years (see Reddy and Minoiu, 2006, for a different disaggregation technique which produces a similar result). And yet Hanmer et. al. (2003) find that aid that supports vaccination programs probably works, and there is plentiful evidence that some health interventions have been great successes –see also Levine (2004).

36 Klein and Harford (2005).

37 Ruhashyankiko (2005) finds aid is less effective in poor countries. Dollar and Levin (2005) find that, all else equal, World Bank projects in Africa have a lower success rate than elsewhere. Nonetheless, Gomanee et. al. (2005) find that aid is significantly related to growth for a subsample of Sub-Saharan countries. 38 McGillivray suggests that the evidence from a number of studies suggests that diminishing (to the point of negative) returns “is a seemingly highly robust finding” somewhere between 15 and 45 percent of GDP. See also Doucouliagos and Paldam (2005c) who find some support for the model although they suggest it may reflect “the mining of an arbitrary quirk in the data” –in which regard see Mwanza, (2004). 39 Banerjee and He (2003), OED (2005c), World Bank (1998). This applies as much to policy-based lending as project-based, with the OED (2000a,b) finding that reforms supported by the Bank are more likely to be sustained if there is consensus within countries and between countries and the Bank on the importance and direction of those reforms.

40 Collier and Dehn (2001). Much like Marshall aid, this may reflect aid going to countries where income levels are tepmporarily below the level that would be ‘expected’ given the strength of their institutions. 41 Roodman (2004). Doucouliagos and Paldam’s (2005c) metastudy also rejects the significance of the good policy result. McGillivray (2005) quotes eight studies (with six authors) that find an aid-policy link and 26 that find no link. Doucouliagos and Paldam’s (2005a) metastudy does suggest that aid to Asia and aid since the 1970s is more significantly related to growth than other aid.

42 See Easterly, Levine and Roodman (2003).

43 Dollar and Levin (2005) argue that institutional strength is a significant determinant of World Bank project outcomes (see also Wane, 2004).

44 OED (1999c).

45 Clemens Kenny and Moss (2005b).

46 OED (2001). This may reflect excessive optimism about how much improvement a SAL could induce, nonetheless, the particularly poor performance of structural adjustment loans where they are probably most needed is a sad irony and supports the decision to abandon such lending. 47 Easterly (1999), Kenny (2005).

48 Based on WDI data.

49 Regarding complex causal interactions, for example, Kremer and Miguel (2001) link de-worming to school attendance, while Ranis and Stewart (2001) find health expenditures don’t appear to improve outcomes, but expenditure on increasing female primary enrollments does.

50 Kenny, (2005). As a recent example, the partially aid-funded effort to eliminate polio worldwide has been a huge success –in 1980, the disease disabled over half a million people each year, by 2000 it had been all but eradicated. But recent outbreaks in countries formerly polio-free have stricken hundreds – including 225 children in Indonesia—because of a strain emerging from Kano, in Northern Nigeria. There, the governor of the state banned polio vaccinations on the grounds that they were part of a plot to sterilize African girls.

51 Regarding the outcome of aid financing, McGillivray (2005) cites some studies that look at the impact of aid on health and education expenditure and finds suggests there is some (weak) evidence that aid results in higher expenditures, but Pritchett et. al. (1998) note the weak relationship between health expenditures and outcomes. Perhaps partially as a result, Kenny (2005) cannot find robust links between aid flows and 20