COMMENT ON AZAM AND BERLINSCHI
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recent memory. In the light of the times in which we live, the issues raised by Azam and Berlinschi cannot be ignored. Their results suggest the need for more studies at the micro level, with a focus on institutions. The authors do seem to have given us an example of aid that works. If foreign aid can generate a desired policy outcome when the agenda is hidden, why not when the objective is open? How can foreign aid be effective in furthering the hidden agenda (revealed preference) but ineffective in promoting declared objectives? And, how much can we rely on evidence from eight years of data in a history of compassionate or not-so-compassionate giving that spans more than three decades? Perhaps the real message here is that transparency in the aid business is overdue. Easterly and Pfutze (2008) emphasized the same message. Transparency can engender the correct attribution or decomposition of aid into its various goals (hidden and covert), opening a prospect for transforming the entire aid-ineffectiveness puzzle into an understandable picture. Finally, I have to acknowledge with a great deal of satisfaction that, as a by-product, Azam’s and Berlinschi’s paper provides support for the push by recipient countries for better donor coordination with a view to improving absorptive capacity (see, for instance, Birdsall, Williamson, and Deese 2002; de Renzio 2005; Ayogu 2006).
References Ayogu, Melvin. 2006. “Can Africa Absorb More Aid?” In Aid, Debt Relief and Development in Africa: African Development Report 2006, ed. African Development Bank, 25–40. New York: Oxford University Press. Birdsall, Nancy, John Williamson, and Brian Deese. 2002. Delivering on Debt Relief: From IMF Gold to a New Aid Architecture. Washington, DC: Center for Global Development and Institute for International Economics, http://www.iie.com. de Renzio, Paolo. 2005. “Scaling Up versus Absorptive Capacity: Challenges and Opportunities for Reaching the MDGs in Africa.” ODI Briefing Paper, London. Easterly, William, and Tobias Pfutze. 2008. “Where Does the Money Go? Best and Worst Practices in Foreign Aid.” Journal of Economic Perspectives 22 (2): 29–52. Rodrik, Dani. 2000. “How Far Will International Economic Integration Go?” Journal of Economic Perspectives 14 (1): 177–86.