Prominent socio-legal scholars have criticized the World Bank’s Doing Business Project on the grounds that development aid donors improperly condition aid on compliance with Doing Business norms. This paper provides the first empirical test of that thesis. I examine nearly a decade of development assistance to analyze whether developing countries that implement more Doing Business reforms indeed tend to receive more development aid. I find mixed support for the conditionality thesis. While aid from multilateral organizations and from the World Bank’s International Development Assistance (IDA) program are correlated with reform efforts, total aid, as well as aid from rich countries, is not.
Keywords
world bank
development aid
doing business
legal reform
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