Waylaid Dialectic

September 2, 2012

ODA vs Private Donations to Development NGOs a Journey into the Depths…

Filed under: Aid — terence @ 6:09 pm

I was in catacombs deep underneath a European city. The air smelt like dead moths, dust was forming into strata, and my candle trembled like a development economist who has just been asked to share his source data by David Roodman.

And yet I’d found was I was looking for. The OECD DAC aid transparency memorial library.

The librarian was frail and pale. His suit was decades old, and either it had grown or he had shrunk in the years since he bought it. His voice was the voice of a man who had never shouted.

“Is it true that they have electric power now in the Center for Global Development?” There was an accent, but I couldn’t pick it. “Americans,” he shook his head disapprovingly.

“This is the data you’re after”, he handed me a dog-eared spreadsheet. “But, remember, you need to read the warnings in this PDF – start at page 4, paragraph 3. Trust no one.”

His voice was less than a whisper now. Talking was wearing him out. He dismissed me with a sad, shaking wave of his hand.

My candle was no more than a stub when I finally made it to the surface. But I had a spring in my step. I had it!

Data, on private donations to development NGOs. Bad data. Data I shouldn’t trust. But data none the less.

Over the following weeks I nurtured that spreadsheet in a small jar in the sun on my windowsill. And eventually it blossomed into a pivot table and pivot chart [excel file – will only work on Excel 07 and 10]. Then, giddied by the beautiful European spring air, I pruned some data and baked it in my Stata oven.

My whole journey had been in aid of answering one question. Is Official Development Assistance a compliment or competitor to private donations to NGOs. Do countries that give more ODA give less private aid?

This is sometimes claimed. For example, here (IIRC) [pdf] by Jane Smith at NZ’s Maxim institute. And it’s plausible. Maybe people in countries that give a lot of ODA don’t make private donations figuring they do that they do that via taxes. Were it true it could be a problem, at least if you think private aid is more effective than ODA (and it could be, being less subject to political economy problems at the donor end.)

What finally emerged from the oven is there below for you to see. It’s a only half baked as I haven’t run any regression diagnostics, and it’s just a simple bi-variate regression. But I don’t think anything would change the result: there is no relationship either positive or negative between ODA and private donations. Or, if there is a relationship it is, in fact, actually a slight positive one but it’s not even remotely, slightly, statistically significant (although that’s kind of a meaningless term as the data are a population not a sample).

And that’s that. Journey over.

By the way, let me recommend the pivot chart file again. If you know what you’re doing you get nice line charts of trends in ODA and private aid. Fun stuff.

Note that: Au = Austria, Aus = Aus. Data are missing for Norway and Spain. Regressed are 4 year means (2007-2010) All the other detail you need about the data is in the spreadsheet.

Regression results below are run for 2007, 2010 and 2007-2010 averages.

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