The usual excuse for not using impact evaluation methods in assessing the effectiveness of trade assistance is that the ‘clinical’ nature of the treatment needed for a proper definition of treatment and control groups is absent from trade policy. Most evaluations were qualitative – interviews with focus groups and satisfaction questionnaires – and even those involving some sort of quantitative exercise were typically based on simple before-after comparisons, known to be vulnerable to many confounding influences.Ĭan trade be evaluated more like development economists are doing (eg Banerjee and Duflo 2009)? Impact-evaluation methods have proved to be powerful tools to help guide policy choices in other areas of development work such as health and education. For instance, out of the 85 World Bank trade-related interventions that started between 19, only five were evaluated rigorously using a control group as a benchmark. Yet so far the development community has struggled to respond to these demands, and there is surprisingly little evidence about what works and what doesn’t in the area of trade and industrial policies. With rising concerns about jobs and competitiveness, Aid for Trade might well become an increasingly hard sell to donors.Ī strong emphasis on results and accountability could help reconcile the continued need for trade-related assistance with growing budgetary pressures in donor countries. A July 2010 Harris poll featured by the Financial Times showed budget deficits to be a prime concern for respondents in most OECD donor countries moreover, development aid stood out as the number-one candidate for cuts. There were times when donors were content merely to see aid disbursed or to see any association between aid and favourable outcomes – perhaps because development aid was seen as a sort of moral obligation. It is not entirely clear that aid has caused these trade outcomes. If judged by broad indicators such as the share of low-income countries in world exports – up, albeit modestly, from 0.77% in 2000 to 1.04% in 2010 1 – it could also be seen as a success. If judged by the money mobilised, the Aid for Trade initiative – which aims to help low-income countries integrate into the global economy – is already a success, with funding up to $40 billion by 2010.
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