Sue Chu

Capstone 7
Greene
October 17, 2016
Track Hours Reflection
Reflection
The first four hours of my track comes from the last of the summer track hours and the
other four is acquired through independent study by reading and analyzing scholarly articles
myself in order to learn more about my topic on foreign aid.
The first source called The Economics of International Aid by Ravi Kanbur where I was
able to learn about the developmental impact of aid. First, the impact of aid stays controversial
because of the micro-macro paradox which is when the results on the micro level is better than
the results on the overall economic development. Aid agencies may often take advantage of this
phenomenal by only displaying the local impact and neglecting the overall impact. While this
can be easily fixed by shadow pricesby taking into account of the macro distortion, many
organizations choose not to take this extra step in their evaluations. This analysis is important to
my studies because without these two clarifications some data or research that I do could
possibly lead me to misevaluate the information. This paper made me realize to question the
validity of any reports on foreign aid evaluation.
This source is 32 pages long and is single spaced with a relative small font. I spent about
one and a half hour on this source. With this source, I had spend a time on fully digesting the
language and look up theories or concepts that are new to me. I also took detailed notes as I read
this paper.
The second source is called The Cartel of Good Intentions: Bureaucracy Versus Markets
in Foreign Aid. This source is very useful for my second research timed writing which is about
the contemporary issues of foreign aid. THis paper states and explains the various complications
of foreign aid in detailed based on its international organization. The language also helped me
understand how a foreign aid bureaucracy has formed an international cartel. Even though it has
good intentions its performance is terrible. Some of the problems stated are many that I have

already heard of from research like organization trying to do everything at the same time,
obfuscation, conditionality, and dependence. But this paper shed a new light on how there is no
competition in the foreign aid environment. Through coordination, foreign aid agencies are able
to monopolize on foreign aid, giving us only one, non effective way to donate. I think with the
way foreign aid is organized there can be little room for reform.
This source is 73 pages long and I spent about two hours and thirty minutes on this
source. I took detailed notes on the paper and looked up different concepts. For this source, I also
went through the works cited to skim other works for better understanding.

Source Analysis
Source Number/Letter: A
MLA/APA/AMA Citation:
Kanbur, R. (2006). The economics of international aid. Handbook of the
Economics of Giving, Altruism and Reciprocity, 2, 1559-1588.
Source Validation: This source is a working paper by Ravi Kanbur, a professor in the
Department of Applied Economics and Management at Cornell University.
How did you find this source?: I found this source on Google Scholar.
Intended audience: This is an academic paper intended for professional scholars. This
paper was originally prepared for a handbook on The Economics of Giving, Reciprocity
and Altruism.
What arguments/topics does this source discuss?: This paper explains how economics
play a role on the impact of foreign aid, presents some theories about the policy of
foreign aid, and shows how aid has evolved over the years. The paper starts by explaining
the history of aid and the definition of modern foreign aid. The first policies of foreign
aid begins with the Colonial Development Act of 1929 and goes on to Colonial
Development and Welfare Acts in 1940-1945, 1948 Overseas Resource Development
Act, Marshal plan, and to what is now the United Nations, World Bank And the IMF. The
author also discussed the changes from a moral incentive for aid to a political one after
the cold war. There are two theories discussed in the paper of how aid should be given.
The first is unconditional international transfers which from analysis proves to be
disadvantageous for the donor country and more advantageous for the recipient country.
The second is through conditionality where there are certain requirements in order to
receive aid. The paper also evaluate the developmental impact of aid based on from a
personal level to the overall economic growth. The dependency created b foreign aid can
also be devestating to the recipient country.in conclusion the foreglobal gorein aid policy
hadreained larfes unchanged for half a centurey and we may no exxpecect and new
changes for sometimein the near future. But the analytical procedure of aid will definitely
improve while policies may not.

 Minimum 3 quotes, paraphrases, summaries of source text that seem likely to be

helpful in future writing:
Unconditional international transfers are based mainly on a moral incentive. THis
distorts the general equilibrium of local economy and causes immiserization and
aid misuse. The disadvantage for donor and advantage for recipient country is
also a cause for tied aid.
The micro-macro paradox where aid had a positive impact in local areas and
negative impact on the economic growth can be overcome with shadow prices
by taking into account the amount of macro distortion
The concept of common pool was made to address many current issues by: 1.
Reducing donor interference 2. Reduce fragmentation 3. Improve local
ownership 4. Give donors a choice to for the allocation for funds

 Source Number/Letter: B
MLA/APA/AMA Citation:
Easterly, W. (2002). The cartel of good intentions. Foreign Policy, (131), 40.
Source Validation: This is a working paper published William Easterly, an American
economist specialized in economic development and a Professor of Economics at New
York University, for the Center for Global Development.
How did you find this source?: I found this source on Google Scholar.
Intended audience: The intended audience is for people who are interested in the results
of foreign aid and why it isnt as effective as most people believe it should be.
What arguments/topics does this source discuss?: This paper mainly focuses on the
idea that with the way our current foreign aid is organized is kind of like a Cartel of good
intentions. Foreign aid today is organized in the form of a bureaucracy . While a
bureaucracy will work best in a free and competitive environment, foreign aid does not
offer an environment that bureaucracies works well in. The leading foreign aid
organization s are a cartel because they coordinated rather than compete. In the hostile
environment of foreign aid this cartel formed because of reasons like maximizing the
operation cost and sharing the blame for bad projects. This cartel is contributing to the
limited impact of foreign aid. First, the cartel limits the option of NGOs to find alternate
suppliers or file complaints about which world government isnt working. Second,
There is really little understanding and knowledge about economic development because
the cartel mostly work with local elites and problematic governments who may not want
poverty reduction causing the poor to remain voiceless. The cartel also uses obfuscations,
acronyms, euphemisms to try and hide bad results. ANother problem with the cartel is
that each organization is trying to do everything meaning that they would be working on
a short term financial crisis and a long term poverty reduction project at the same time. In
conclusion, aid, in the form of a bureaucracy and a difficult environment, responds by
organizing as a cartel which suppress feedback, new channels for the best options for
resources, and competition pressure for results. In order to change this we should try to

make the foreign aid agencies organized as a free marketplace, use vouchers, and let the
intended recipient, the impoverished, a chance make their own choices.
Minimum 3 quotes, paraphrases, summaries of source text that seem likely to be
helpful in future writing:
Foreign Aid works for everyone except the people intended to help and it doesn't
make any sense that it takes $3521 to raise a poor person's income by #3.65 a
year.
WHile foreign aid promotes the idea of self help since the beginning many
countries violated region national sovereignty and substituted local institutions
through foreign aid and examples can be seen in Honduras and Tanzania.
Vouchers has proved to improve earnings in colombia, increase school
productiveness in Michigan and Arizona, and increase African American test
scores in New York, Dayton, ANd washington D.C., while it failed in Chile
overall.