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Buying influence : aid fungibility in a strategic perspective

Hagen, Rune Jansen
Working paper
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URI
http://hdl.handle.net/11250/162756
Date
2004-04
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  • Discussion papers (SAM) [586]
Abstract
I study equilibria of non-cooperative games between an aid donor and

a recipient when there is conflict over the allocation of their combined

budgets. The general conclusion is that a donor’s influence over outcomes

is increasing in the share of the available resources it controls; if this

share is large enough, aid is not fungible. The game-theoretic approach

to fungibility is contrasted with the traditional non-strategic approach. I

argue that the former is superior as it derives final allocations instead of

assuming them, making analysis of the sources of influence over outcomes possible.
Publisher
Norwegian School of Economics and Business Administration. Department of Economics
Series
Discussion paper
2004:10

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