Farm Aid started as a benefit concert on September 22, 1985, in Champaign, Illinois, held to raise money for family farmers in the United States. The concert was organized by Willie Nelson, John Mellencamp and Neil Young, spurred on by Bob Dylan's comments at Live Aid earlier in that year that he hoped some of the money would help American farmers in danger of losing their farms through mortgage debt.^[1]

The first concert was at University of Illinois' Memorial Stadium in Champaign on September 25 before a crowd of 80,000 people. Performers included Bob Dylan, Billy Joel, B.B. King, Roy Orbison, among others,^[2] and raised over $9 million for America's family farmers.^[3]

Nelson and Mellencamp then brought family farmers before Congress to testify about the state of family farming in America. Congress subsequently passed the Agricultural Credit Act of 1987 to help save family farms from foreclosure. Today, Farm Aid is an organization that works to increase awareness of the importance of family farms, and puts on an annual concert of country, blues and rock music with a variety of stars. The board of directors includes Nelson, Mellencamp, Young, and Dave Matthews. Young's speeches about the environment are a highlight of the annual shows. After the initial concert, the organization established emergency hot lines for farmers and farm associations. Farm Aid holds a farm disaster fund for farmers who lost their belongings and crops through natural disasters, such as the victims of Hurricane Katrina^[4] and the 2011 tornadoes. The funds raised are used to pay the farmer's expenses and provide food, legal and financial help, and psychological assistance.^[5]

The 2005 concert, marking the 20th anniversary of Farm Aid, took place at the Tweeter Center in Tinley Park, Illinois, with events in downtown Chicago as well. The 2007 Concert took place at Randall's Island in New York City (1st Farm Aid in New York) and was recorded in High Definition to be broadcast on HDNet as a 2 Hour Special highlighting many of the performances from the Allman Brothers and Counting Crows to John Mellencamp and Willie Nelson.

List of concerts[link]

Through 2010, Farm Aid concerts have been held in the following locations:

The Board of Directors[link]

References[link]

External links[link]

• Official Website
• Official MySpace
• Farm Aid 2006 - Behind The Scenes

Typical plan of a mediaeval English manor, showing the use of field strips

A farm is an area of land, or, for aquaculture, lake, river or sea, including various structures, devoted primarily to the practice of producing and managing food (produce, grains, or livestock), fibres and, increasingly, fuel. It is the basic production facility in food production.^[1] Farms may be owned and operated by a single individual, family, community, corporation or a company. A farm can be a holding of any size from a hectare^[2] to several thousand hectares.^[3]

Etymology[link]

Farmer harvesting crops with mule-drawn wagon, 1920s, Iowa, USA

The word in the sense of an agricultural land-holding derives from the verb "to farm" a revenue source, whether taxes, customs, rents of a group of manors or simply to hold an individual manor by the feudal land tenure of "fee farm". The word is from the medieval Latin noun firma, also the source of the French word ferme, meaning a fixed agreement, contract, ^[4] from the classical Latin adjective firmus-a-um meaning strong, stout, firm.^[5][6] As in the medieval age virtually all manors were engaged in the business of agriculture, which was their principal revenue source, so to hold a manor by the tenure of "fee farm" became synonymous with the practice of agriculture itself.

Farming[link]

Overhead irrigation, center pivot design

The term farming covers a wide spectrum of agricultural production work. At one end of this spectrum is the subsistence farmer, who farms a small area with limited resource inputs, and produces only enough food to meet the needs of his family. At the other end is commercial intensive agriculture, including industrial agriculture. Such farming involves large fields and/or numbers of animals, large resource inputs (pesticides, fertilizers, etc.), and a high level of mechanization. These operations generally attempt to maximize financial income from grain, produce, or livestock.

Traditionally, the goal of farming was to work collectively as a community to grow and harvest crops that could be grown in mass such as wheat, maize, squash, and other cash crops. Centuries later these same farmers took charge of livestock, and began growing food exclusively for the feeding of livestock as well as for the community. With the growth of civilization the farmer's focus changed from basic survival to that of financial gain. In smaller towns on the outset of civilization the farmer did retain the need to grow their own food, but the financially minded farmer was largely spreading. With the Renaissance came the plantation, a farm primarily worked by others primarily for the gain of the plantation's owner. Then came a new age of industry where the farm could be staffed by fewer people and big machines. This meant a complete revolution for farming.

Types of farms[link]

A typical North American grain farm with farmstead in Ontario, Canada

Farmlands in Hebei province, China

A business producing tree fruits or nuts is called an orchard; a vineyard produces grapes. The stable is used for operations principally involved in the training of horses. Stud and commercial farms breed and produce other animals and livestock. A farm that is primarily used for the production of milk and dairy is a dairy farm. A market garden or truck farm is a farm that grows vegetables, but little or no grain. Additional specialty farms include fish farms, which raise fish in captivity as a food source, and tree farms, which grow trees for sale for transplant, lumber, or decorative use. A plantation is usually a large farm or estate, on which cotton, tobacco, coffee or sugar cane, are cultivated, often by resident laborers.

Types of farming[link]

• Collective farming
• Factory farming
• Intensive farming
• Protected culture farming
• Organic farming
• Vertical farming
• Fell farming

Specialized farms[link]

Dairy farms[link]

A milking machine in action

Dairy farming is a class of agriculture, where female cattle, goats, or other mammals are raised for their milk, which may be either processed on-site or transported to a dairy for processing and eventual retail sale.

In most Western countries, a centralized dairy facility processes milk and dairy products, such as cream, butter, and cheese. In the United States, these dairies are usually local companies, while in the southern hemisphere facilities may be run by very large nationwide or trans-national corporations (such as Fonterra).

Dairy farms generally sell the male calves borne by their mothers for veal meat, as dairy breeds are not normally satisfactory for commercial beef production. Many dairy farms also grow their own feed, typically including corn, alfalfa, and hay. This is fed directly to the cows, or stored as silage for use during the winter season. Additional dietary supplements are added to the feed to improve milk production. ^[7]

Poultry farms[link]

Poultry farms are devoted to raising chickens, turkeys, ducks, and other fowl, generally for meat or eggs.^[8]

Prison farms[link]

Prison farms are farms which serve as prisons for persons sentenced to hard labor by a court. On prison farms inmates run the important tasks of a farm, producing crops. ^[9]

Ownership[link]

Typical cattle yard in Northern Iowa, USA

Farm control and ownership has traditionally been a key indicator of status and power, especially in Medieval European agrarian societies. The distribution of farm ownership has historically been closely linked to form of government. Medieval feudalism was essentially a system that centralized control of farmland, control of farm labor and political power, while the early American democracy, in which land ownership was a prerequisite for voting rights, was built on relatively easy paths to individual farm ownership. However, the gradual modernization and mechanization of farming, which greatly increases both the efficiency and capital requirements of farming, has led to increasingly large farms. This has usually been accompanied by the decoupling of political power from farm ownership.^{[citation needed]}

Forms of ownership[link]

In some societies (especially socialist and communist), collective farming is the norm, with either government ownership of the land or common ownership by a local group. Especially in societies without widespread industrialized farming, tenant farming and sharecropping are common; farmers either pay landowners for the right to use farmland or give up a portion of the crops.

Roll of barbed wire used to mark fence line on cattle farms

Farms around the world[link]

Australia[link]

Cows grazing on a farm in Victoria, Australia

Farming is a significant economic sector in Australia. A farm is an area of land used for primary production which will include buildings.

Where most of the income is from some other employment, and the farm is really an expanded residence, the term hobby farm is common. This will allow sufficient size for recreational use but be very unlikely to produce sufficient income to be self-sustaining. Hobby farms are commonly around 5 acres (20,000 m²) but may be much larger depending upon land prices (which vary regionally).

Often very small farms used for intensive primary production are referred to by the specialization they are being used for, such as a dairy rather than a dairy farm, a piggery, a market garden, etc. This also applies to feedlots, which are specifically developed to a single purpose and are often not able to be used for more general purpose (mixed) farming practices.

In remote areas farms can become quite large. As with estates in England, there is no defined size or method of operation at which a large farm becomes a station.

Regardless of size, the term station is only used for farms where the main activity is grazing. Some cotton farms in north-western New South Wales or south-western Queensland have been formed by combining previous sheep stations once sufficient water has become available to allow cotton to be grown.

United Kingdom[link]

In the UK, farm as an agricultural unit, always denotes the area of pasture and other fields together with its farmhouse, farmyard and outbuildings. Very large farms, or groups of farms under the same ownership, may be called an estate. Conversely, a small farm surrounding the owner's dwelling is called a smallholding and is generally focused on self-sufficiency with only the surplus being sold.

North America[link]

Farming near Klingerstown, Pennsylvania

Traditional Dutch farmhouse

The land and buildings of a farm are called the "farmstead."^{[citation needed]} Enterprises where livestock are raised on rangeland are called ranches. Where livestock are raised in confinement on feed produced elsewhere, the term feedlot is usually used.

In 1910 there were 6,406,000 farms and 10,174,000 family workers; In 2000 there were only 2,172,000 farms and 2,062,300 family workers.^[10]

In the United States, eighty-one percent of all farmworkers are migrant workers, and seventy-one percent are foreign-born.^{[citation needed]} Eighty percent of farmworkers are men, with the average age being 31.^{[citation needed]} Additionally, farmworkers earn less than $75,000 per year, making an average hourly rate of less than $27.00.^{[citation needed]} On average, one-half of all farmworker families earn less than $10,000 per year,^[11] which is significantly below the 2005 U.S. poverty level of $19,874 for a family of four.

In 2007, corn acres are expected to increase by 15% because of the high demand for ethanol, both in and outside of the U.S. Producers are expecting to plant 90.5 million acres (366,000 km²) of corn, making it the largest corn crop since 1944.^[12]

Farm buildings[link]

Farms require buildings to facilitate the action of farming the material at hand. Such buildings can include a farm house (for the farmers), a grain silo (for storing grain), and a barn (for the storing of certain animals.)

Farm equipment[link]

Gallery[link]

See also[link]

Agriculture and Agronomy portal

References[link]

Bibliography[link]

• Adams, Jane H. (July 1988). "The Decoupling of Farm and Household: Differential Consequences of Capitalist Development on Southern Illinois and Third World Family Farms". Comparative Studies in Society and History 30 (3): 453–482. DOI:10.1017/S0010417500015334. 
• Blackbourn, David (1998). The Long Nineteenth Century: A History of Germany, 1780–1918. New York: Oxford University Press. 
• Clark, Christopher (2006). Iron Kingdom: The Rise and Downfall of Prussia, 1600–1947. Cambridge, Massachusetts: The Belknap Press of Harvard University Press. 
• Gregor, Howard F. (July 1969). "Farm Structure in Regional Comparison: California and New Jersey Vegetable Farms". Economic Geography (Economic Geography, Vol. 45, No. 3) 45 (3): 209–225. DOI:10.2307/143091. JSTOR 143091. 
• Grigg, David (July 1966). "The Geography of Farm Size a Preliminary Survey". Economic Geography (Economic Geography, Vol. 42, No. 3) 42 (3): 205–235. DOI:10.2307/142007. JSTOR 142007. 
• Schmidt, Elizabeth (1992). Peasants, Traders, and Wives: Shona Women in the History of Zimbabwe, 1870–1939. Portsmouth, New Hampshire: Heinemann. 

External links[link]

Wikimedia Commons has media related to: Farms

Look up farm or farmstead in Wiktionary, the free dictionary.

• "Tiny Farm Wiki". http://tinyfarmwiki.com/. 
• "Farming styles and extension in broadacre cropping". The Australian Society of Agronomy. http://www.regional.org.au/au/asa/1998/7/275howden.htm. Retrieved 2007-04-18. 
• "What is Sustainable Agriculture?". University of California. December 1997. http://www.sarep.ucdavis.edu/concept.htm. Retrieved 2007-04-18. 
• Diver, Steve (August 2002). "Introduction to Permaculture: Concepts and Resources". The ATTRA Project. http://www.attra.org/attra-pub/perma.html. Retrieved 2007-04-18. 
• "Tiny Extremadura Farm". http://my11.net/. 
• Open Source Ecology

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Aid received, per capita, in 2007, in $ of Official Development Assistance per person. Note that grey countries can either be non-recipients or ones for which data is unavailable. The data were converted into dollars using exchange rates, hence may not accurately reflect the purchasing power of the foreign aid received.^[1]

In international relations, aid (also known as international aid, overseas aid, or foreign aid) is a voluntary transfer of resources from one country to another, given at least partly with the objective of benefiting the recipient country.^[2] It may have other functions as well: it may be given as a signal of diplomatic approval, or to strengthen a military ally, to reward a government for behaviour desired by the donor, to extend the donor's cultural influence, to provide infrastructure needed by the donor for resource extraction from the recipient country, or to gain other kinds of commercial access.^[3] Humanitarianism and altruism are, nevertheless, significant motivations for the giving of aid.^[4]

Aid may be given by individuals, private organisations, or governments. Standards delimiting exactly the kinds of transfers that count as aid vary. For example, aid figures may or may not include transfers for military use: to cite one instance, the United States included military assistance in its aid figure until 1957 but no longer does.^[5] The most widely used measure of aid, "Official Development Assistance" (ODA) is such a figure. It is compiled by the Development Assistance Committee of the Organisation for Economic Co-operation and Development. The United Nations, the World Bank, and many scholars use the DAC's ODA figure as their main aid figure because it is easily available and reasonably consistently calculated over time and between countries.^[6] The DAC consists of 22 of the wealthiest Western industrialised countries plus the EU; it is a forum in which they coordinate their aid policies.

Types[link]

Humanitarian aid[link]

Humanitarian aid or emergency aid is rapid assistance given to people in immediate distress by individuals, organisations, or governments to relieve suffering, during and after man-made emergencies (like wars) and natural disasters. The term often carries an international connotation, but this is not always the case. It is often distinguished from development aid by being focussed on relieving suffering caused by natural disaster or conflict, rather than removing the root causes of poverty or vulnerability.

U.S. Soldiers unload humanitarian aid for distribution to the town of Rajan Kala, Afghanistan, Dec. 5, 2009

The provision of humanitarian aid or humanitarian response consists of the provision of vital services (such as food aid to prevent starvation) by aid agencies, and the provision of funding or in-kind services (like logistics or transport), usually through aid agencies or the government of the affected country. Humanitarian aid is distinguished from humanitarian intervention, which involves armed forces protecting civilians from violent oppression or genocide by state-supported actors.

The Geneva Conventions give a mandate to the International Committee of the Red Cross and other impartial humanitarian organizations to provide assistance and protection of civilians during times of war. The ICRC, has been given a special role by the Geneva Conventions with respect to the visiting and monitoring of prisoners of war.

The United Nations Office for the Coordination of Humanitarian Affairs (OCHA) is mandated to coordinate the international humanitarian response to a natural disaster or complex emergency acting on the basis of the United Nations General Assembly Resolution 46/182.

The Sphere Project handbook, Humanitarian Charter and Minimum Standards in Disaster Response, which was produced by a coalition of leading non-governmental humanitarian agencies, lists the following principles of humanitarian action:

1. The right to live with dignity.
2. The distinction between combatant and non-combatants.
3. The principle of non-refoulement.

Development aid[link]

Official Development Assistance (ODA) measured in GNI in 2009. Source: OECD

Development aid is aid given by developed countries to support development in general which can be economic development or social development in developing countries. It is distinguished from humanitarian aid as being aimed at alleviating poverty in the long term, rather than alleviating suffering in the short term.

Official Development Assistance (ODA), mentioned above, is a commonly used measure of developmental aid. Development aid is given by governments through individual countries' international aid agencies and through multilateral institutions such as the World Bank, and by individuals through development charities such as ActionAid, Caritas, Care International or Oxfam.

The offer to give development aid has to be understood in the context of the Cold War. The speech in which Harry Truman announced the foundation of NATO is also a fundamental document of development policy:

In addition, we will provide military advice and equipment to free nations which will cooperate with us in the maintenance of peace and security. Fourth, we must embark on a bold new program for making the benefits of our scientific advances and industrial progress available for the improvement and growth of underdeveloped areas. More than half the people of the world are living in conditions approaching misery. Their food is inadequate. They are victims of disease. Their economic life is primitive and stagnant. Their poverty is a handicap and a threat both to them and to more prosperous areas. For the first time in history, humanity possesses the knowledge and skill to relieve the suffering of these people.

Sources[link]

Aid from various sources can reach recipients through bilateral or multilateral delivery systems. Bilateral refers to government to government transfers. Multilateral institutions, such as the World Bank or UNICEF, pool aid from one or more sources and disperse it among many recipients.

• Official Development Assistance (ODA): Development aid provided to developing countries (on the "Part I" list) with the clear aim of economic development
• Official Aid (OD): Development aid provided to developed countries (on the "Part II" list) and international organizations
• Other Official Flows (OOF): Aid which does not fall into the other two categories, either because it is not aimed at development, or it consists of more than 75% loan (rather than grant).

Aid is often pledged at one point in time, but disbursements (financial transfers) might not arrive until later.

Private giving[link]

Private giving includes aid from charities, philanthropic organizations or businesses to recipient countries or programs within recipient counties.

What is excluded[link]

Most monetary flows between nations are not counted as aid. These include market based flows such as foreign direct investments and portfolio investments. Remittances from migrant workers to their home countries are not counted in aid numbers even though, by volume, it is twice as large as what is counted as aid.^[7] Additionally, military support is not counted.

Receiving aid[link]

Types[link]

• Project aid: Aid is given for a specific purpose e.g. building materials for a new school.
• Programme aid: Aid is given for a specific sector e.g. funding of the education sector of a country.
• Budget support: A form of Programme Aid that is directly channelled into the financial system of the recipient country.
• Sector-wide Approaches (SWAPs): A combination of Project aid and Programme aid/Budget Support e.g. support for the education sector in a country will include both funding of education projects (like school buildings) and provide funds to maintain them (like school books).
• Technical assistance: Educated personnel, such as doctors are moved into developing countries to assist with a program of development. Can be both programme and project aid.
• Food aid: Food is given to countries in urgent need of food supplies, especially if they have just experienced a natural disaster. Food aid can be provided by importing food from the donor, buying food locally, or providing cash.
• International research, such as research that went into the green revolution and many vaccines.

Aid conditionality[link]

A major proportion of aid from donor nations is tied, mandating that a receiving nation spend on products and expertise originating only from the donor country. ^[8] For example, Eritrea is forced to spend aid money on foreign goods and services to build a network of railways even though it is cheaper to use local expertise and resources.^[8] US law requires food aid be spent on buying food at home, instead of where the hungry live, and, as a result, half of what is spent is used on transport.^[9] Oxfam America and American Jewish World Service report that reforming US food aid programs could extend food aid to an additional 17.1 million people around the world.^[10]

The World Bank and the International Monetary Fund, as primary holders of developing countries' debt, attach structural adjustment conditionalities to loans which generally include the elimination of state subsidies and the privatization of state services. For example, the World Bank presses poor nations to eliminate subsidies for fertilizer even while many farmers cannot afford them at market prices.^[11] In the case of Malawi, almost five million of its 13 million people used to need emergency food aid. However, after the government changed policy and subsidies for fertilizer and seed were introduced, farmers produced record-breaking corn harvests in 2006 and 2007 as production leaped to 3.4 million in 2007 from 1.2 million in 2005, making Malawi a major food exporter.^[11] In the former Soviet states, the reconfiguration of public financing in their transition to a market economy called for reduced spending on health and education, sharply increasing poverty.^[12][13][14]

Criticism of aid[link]

Aid is seldom given from motives of pure altruism; for instance it is often given as a means of supporting an ally in international politics. It may also be given with the intention of influencing the political process in the receiving nation. Whether one considers such aid helpful may depend on whether one agrees with the agenda being pursued by the donor nation in a particular case. During the conflict between communism and capitalism in the twentieth century, the champions of those ideologies, the Soviet Union and the United States, each used aid to influence the internal politics of other nations, and to support their weaker allies. Perhaps the most notable example was the Marshall Plan by which the United States, largely successfully, sought to pull European nations toward capitalism and away from communism. Aid to underdeveloped countries has sometimes been criticized as being more in the interest of the donor than the recipient, or even a form of neocolonialism.^[15]

Marshall Plan aid to Germany, West Berlin, 1949

S.K.B'. Asante lists some specific motives a donor may have for giving aid: defense support, market expansion, foreign investment, missionary enterprise, cultural extension.^[16] In recent decades, aid by organizations such as the International Monetary Fund and the World Bank has been criticized as being primarily a tool used to open new areas up to global capitalists, and being only secondarily, if at all, concerned with the wellbeing of the people in the recipient countries.

Besides criticism of motive, aid may be criticized simply on the grounds that it is not effective: i.e., it did not do what it was intended to do or help the people it was intended to help. This is essentially an economic criticism of aid. The two types of criticism are not entirely separate: critics of the ideology behind a piece of aid are likely to see it as ineffective; and indeed, ineffectiveness must imply some flaws in the ideology. Statistical studies have produced widely differing assessments of the correlation between aid and economic growth, and no firm consensus has emerged to suggest that foreign aid generally does boost growth. Some studies find a positive correlation, but others find either no correlation or a negative correlation. In the case of Africa, Asante (1985) gives the following assessment:

Summing up the experience of African countries both at the national and at the regional levels it is no exaggeration to suggest that, on balance, foreign assistance, especially foreign capitalism, has been somewhat deleterious to African development. It must be admitted, however, that the pattern of development is complex and the effect upon it of foreign assistance is still not clearly determined. But the limited evidence available suggests that the forms in which foreign resources have been extended to Africa over the past twenty-five years, insofar as they are concerned with economic development, are, to a great extent, counterproductive.^[17]

The economist William Easterly and others have argued that aid can often distort incentives in poor countries in various harmful ways. Aid can also involve inflows of money to poor countries that have some similarities to inflows of money from natural resources that provoke the resource curse.^[18][19]

Many individuals^[20] and organizations criticize U.S. Aid. Emergency funds from the International Monetary Fund (IMF) and World Bank, for instance, are linked to a wide range of free-market policy prescriptions that some argue interfere in a country's sovereignty. Policy prescriptions from outsiders can do more harm as they might not fit the local environment. The IMF can be good at helping countries over a short problematic financial period, but for poor countries with long lasting issues it can cause harm.^{[citation needed]} In his book The White Man's Burden, Easterly argued that if the IMF only gave adjustment loans to countries that can repay it, instead of forgiving debts or lending repetitively even if conditions are not met, it would maintain its credibility.

In addition to the above criticisms, the logistics in which aid delivery occurs can be problematic. An earthquake in 2003 in Bam, Iran left tens of thousands of people in need of disaster zone aid. Although aid was flown in rapidly, regional belief systems, cultural backgrounds and even language seemed to have been omitted as a source of concern. Items such as religiously prohibited pork, and non-generic forms of medicine that lacked multilingual instructions came flooding in as relief. An implementation of aid can easily be problematic, causing more problems than it solves.^[21]

James Shikwati, a Kenyan economist, has argued that foreign aid causes harm to the recipient nations, specifically because aid is distributed by local politicians, finances the creation of corrupt government such as that led by Dr Fredrick Chiluba in Zambia bureaucracies, and hollows out the local economy. In an interview in Germany's Der Spiegel magazine, Shikwati uses the example of food aid delivered to Kenya in the form of a shipment of corn from America. Portions of the corn may be diverted by corrupt politicians to their own tribes, or sold on the black market at prices that undercut local food producers. Similarly, Kenyan recipients of donated Western clothing will not buy clothing from local tailors, putting the tailors out of business.^[22] In an episode of 20/20, John Stossel demonstrated the existence of secret government bank accounts which concealed foreign aid money destined for private purposes.

Some believe that aid is offset by other economic programs such as agricultural subsidies. Mark Malloch Brown, former head of the United Nations Development Program, estimated that farm subsidies cost poor countries about US$50 billion a year in lost agricultural exports:

"It is the extraordinary distortion of global trade, where the West spends $360 billion a year on protecting its agriculture with a network of subsidies and tariffs that costs developing countries about US$50 billion in potential lost agricultural exports. Fifty billion dollars is the equivalent of today's level of development assistance."^[23][24]

Some have argued that the major international aid organizations have formed an aid cartel.^[25]

In response to aid critics, a movement to reform U.S. foreign aid has started to gain momentum. In the United States, leaders of this movement include the Center for Global Development, Oxfam America, the Brookings Institution, InterAction, and Bread for the World. The various organizations have united to call for a new Foreign Assistance Act, a national development strategy, and a new cabinet-level department for development.^[26]

Beyond aid[link]

As a result of these numerous criticisms, other proposals for supporting developing economies and poverty stricken societies. Some analysts, such as researchers at the Overseas Development Institute, argue that current support for the developing world suffers from a policy incoherence and that while some policies are designed to support the third world, other domestic policies undermine its impact,^[27] examples include:

• encouraging developing economies to develop their agriculture with a focus on exports is not effective on a global market where key players, such as the US and EU, heavily subsidise their products
• providing aid to developing economies' health sectors and the training of personnel is undermined by migration policies in developed countries that encourage the migration of skilled health professionals

One measure of this policy incoherence is the Commitment to Development Index (CDI) published by the Center for Global Development . The index measures and evaluates 22 of the world's richest countries on policies that affect developing countries, in addition to simply aid. It shows that development policy is more than just aid; it also takes into account trade, investment, migration, environment, security, and technology.

Thus, some states are beginning to go Beyond Aid and instead seek to ensure there is a policy coherence, for example see Common Agricultural Policy reform or Doha Development Round. This approach might see the nature of aid change from loans, debt cancellation, budget support etc., to supporting developing countries. This requires a strong political will, however, the results could potentially make aid far more effective and efficient.^[27]

Aid inefficiencies and possible improvements[link]

Aid destinations[link]

It is true that aid is rarely given for motives of pure altruism. However, it is important to look at where aid goes. For example, “only about one fifth of U.S. aid goes to countries classified by the OECD as ‘least developed.’”^[28] This “pro-rich” trend is not unique to the United States.^[28][29] According to Collier, “the middle income countries get aid because they are of much more commercial and political interest than the tiny markets and powerlessness of the bottom billion.”^[30] What this means is that, at the most basic level, aid is not targeting the most extreme poverty.^[28][29]

The form of aid must also be considered. The World Bank, until recently, issued only loans, meaning that the country must repay both the loan and the interest rates. In contrast, the European Commission issues grants, which countries need not worry about paying back. This means that “loans have been going to the poorest countries and the grants to the middle-income countries.”^[30]

Furthermore, consider the breakdown, where aid goes and for what purposes. In 2002, total gross foreign aid to all developing countries was $76 billion. Dollars that do not contribute to a country’s ability to support basic needs interventions are subtracted. Subtract $6 billion for debt relief grants. Subtract $11 billion, which is the amount developing countries paid to developed nations in that year in the form of loan repayments. Next, subtract the aid given to middle income countries, $16 billion. The remainder, $43 billion, is the amount that developing countries received in 2002. But only $12 billion went to low-income countries ($15 billion for all developing countries) in a form that could be deemed budget support for basic needs.^[29]

When aid is given to the Least Developed Countries who have good governments and strategic plans for the aid, it is thought that it is more effective.^[29]

Aid outcomes and implications[link]

The basic criticism of aid is that it neither goes where it was intended nor helps those intended. According to Collier, there are four known traps that contribute this problem. The first such trap is known as the conflict trap. Aid should not be used to finance military endeavors. It is difficult to “design aid in such a way that it works even in the environments of poor governance and poor policy that are most at risk of conflict.”^[30] The second trap is called the natural resource trap. Countries that are resource rich already have a large volume of capital flowing into their economies. However, it is not being used to its potential. The third trap occurs when a country is entirely landlocked, making it difficult for the country to engage in global trade.^[30]

The fourth trap is that of bad governance. However, “there are three ways in which aid can potentially help turnarounds: incentives, skills, and reinforcement.”^[30] Policy conditionalities, or structural adjustments, were reservations put on aid until a government agreed to aid implemented in the 1980s. This did not work. Aid needs to somehow provide incentives for giving the people power. Power needs to be transferred from the governments to the people.^[30] Aid should be restructured in order to allow for skills building in country. According to Collier, “technical assistance is not negligible – money spent on countries with the skilled people who constitute technical assistance is a quarter of total aid flows.”^[30] The problem is not that too little money is being provided, rather that technical assistance is not country specific. Aid is also given as budget support, reinforcement for failing states. There is an opportune moment for assisting failing states but it must be done at the right time. Aid cannot be continually poured into failing states and be expected to produce a turnaround. However if aid is given at the opportune political moment, it can support turnarounds. Collier suggests that when that moment occurs “pour in the technical assistance as quickly as possible to help implement reform” and “then, after a few years, start pouring in the money for the government to spend.”^[30]

Actual impact[link]

Peter Singer argues that over the last three decades, “aid has added around one percentage point to the annual growth rate of the bottom billion.” He argues that this has made the difference between “stagnation and severe cumulative decline.”^[28] Aid can make progress towards reducing poverty worldwide, or at least help prevent cumulative decline.

Improving the economic efficiency of aid[link]

Currently, donor institutions make proposals for aid packages to recipient countries. The recipient countries then make a plan for how to use the aid based on how much money has been given to them. Alternatively, NGO's receive funding from private sources or the government, and then implement plans to end their specific issues. In the views of many scholars, this system is inherently ineffective.^[29] If we hope to eliminate poverty, we must reexamine how we distribute funding, and how we attack problems.

According to Sachs, we should redefine how we think of aid. The first step should be to learn what developing countries hope to accomplish and how much money they need to accomplish those goals. Goals should be made with the Millennium Development Goals in mind for these furnish real metrics for providing basic needs. The “actual transfer of funds must be based on rigorous, country-specific plans that are developed through open and consultative processes, backed by good governance in the recipient countries, as well as careful planning and evaluation.”^[29]

Possibilities are also emerging as some developing countries are experiencing rapid economic growth, they are able to provide their own expertise gained from their recent transition. This knowledge transfer can be seen in donors, such as Brazil, whose $1 billion in aid outstrips that of many traditional donors.^[31] Brazil provides most of its aid in the form of technical expertise and knowledge transfers.^[31] This has been descried by some observers as a 'global model in waiting'.^[32]

Various academic theories[link]

Since the 1960s, improving the efficiency of foreign aid has been a common topic of academic research. There is debate on whether foreign aid is efficacious, but for the purposes of this article we will ignore that. Given that schema, a common debate is over which factors influence the overall economic efficiency of foreign aid. Indeed, there is debate about whether aid impact should be measured empirically at all, but again, we will limit our scope to increasing the economic efficiency.

Philosophy[link]

At the forefront of the aid debate has been the conflict between professor William Easterly of New York University ^[33] and his ideological opposite, Jeffrey Sachs, from Columbia University. Easterly advocates the "searcher's" approach, while Sachs advocates a more top down, broad planned approach. We will discuss both of these at length.^[34]

“Searchers Approach”[link]

William Easterly offers a nontraditional, and somewhat controversial “searching” approach to solving poverty, as opposed to the “planned” approach in his famous critique of the more traditional Owen/Sachs, The White Man’s Burden. Traditional poverty reduction, Easterly claims is based on the idea that we know what is best for those countries, which are impoverished. He claims that they know what’s best. Having a top down “master plan,” he claims, is inefficient. His alternative, called the “Searchers” approach, uses a bottom up strategy. That is, this approach starts by surveying the poor in the countries in question, and then tries to directly aid individuals, rather than governments. Local markets are a key incentive structure. The primary example is of Mosquito nets in Malawi. In this example, an NGO sells Mosquito nets to rich Malawians, and uses the profits to subsidize cheap sales to the impoverished. Hospital nurses are used as middle-women, profiting a few cents on every net sold to a patient. This incentive structure has seen the usage of nets in Malawi spike over 40% in less than 7 years.^[35]

Aspects of “Searcher’s Approach”[link]

Bottom up philosophy[link]

One of the central tenets in Easterly’s approach is a more bottom up philosophy of aid. This applies not only to the identification of problems, but to the actual distribution of capital to the areas in need. In effect, Easterly would have countries go to the area which needed aid, collect information about the problem, find out what the population wanted, and then work from there. In keeping with this, funds would also be distributed from the bottom up, rather than being given to a specific government.^[35]

Utilize aid organizations, and local frameworks[link]

Easterly also advocates working through currently existing Aid organizations, and letting them compete for funding. Utilizing preexisting national organizations and local frameworks would not only help give target populations a voice in implementation and goal setting, but is more efficient economically. Easterly argues that the preexisting frameworks already "know" what the problems are, as opposed to outside NGOs who tend to "guess". ^[35]

Aid individuals, not governments[link]

Easterly strongly discourages aid to government as a rule. He believes, for several reasons, that aid to small “bottom up” organizations and Individual groups is a better philosophy than to large governments.^[35]

Independent evaluation[link]

Easterly states that for far too long, inefficient aid organizations have been funded, and that this is a problem. The current system of evaluation for most aid organizations is internal. Easterly claims that the process is biased because organizations have a large incentive to represent their progress in a positive light. What he proposes as an alternative is an independent auditing system for aid organizations. Before receiving funding, the organization would state their goals and how they expect to measure and achieve them. If they do not meet their goals, Easterly proposes we shift our funding to organizations who are successful. This would prompt organizations to either become efficient, or obsolete.^[35]

Compartmentalized goals[link]

Easterly believes that aid goals should be small. In his opinion, one of the main failings of aid lies in the fact that we create large, utopian lists of things we hope to accomplish, without the means to actually see them to fruition. Rather than establish a utopian vision for a particular country, Easterly insists that we shift our focus to the most basic needs and improvements.If we feed, clothe, vaccinate, build infrastructure, and support markets, the macroscopic results will follow.^[35]

Use the market[link]

The “Searching Approach” is intrinsically tied to the market. Easterly claims that the only way for poverty to truly end is for the poor to be given the capability to lift themselves out of poverty, and then for it to happen. Philosophically, this sounds like the traditional “bootstrap” theory, but it isn’t. What he says is that the poor should be given the fiscal support to create their market, which would give them the ability to become self reliant in the future.^[35]

Ideas[link]

In the end of his book, Easterly proposes a voucher system for foreign aid. The poor would be distributed a certain amount of vouchers, which would act as currency, redeemable to aid organizations for services, medicines, and the like. These vouchers would then be redeemed by the aid organizations for more funding. In this way, the aid organization would be forced to compete, if by proxy.^[35]

Proscriptive "Ladder Approach"[link]

Sachs presents a near dichotomy to Easterly. Sachs presents a broad, proscriptive solution to poverty. In his book, The End of Poverty, he explains how throughout history, countries have ascended from poverty by following a relatively simple model. First, you promote agricultural development, then industrialize, embrace technology, and finally become modern. This is the standard “western” model of development that has been followed by countries such as China and India. Sachs main idea is that there should have a broad analytical “checklist” of things a country must attain before it can reach the next step on the ladder to development. Western nations should donate a percentage of their GDP as determined by the UN, and pump money into helping impoverished countries climb the ladder. Sachs insists that if followed, his strategy would eliminate poverty by 2025.

^[36]

Top down[link]

Sachs advocates using a top down methodology, utilizing broad ranging plans developed by external aid organizations like the UN and World Bank. To Sachs, these plans are essential to a coherent and timely eradication of poverty.He surmises that if donor and recipient countries follow the plan, they will be able to climb out of poverty.

^[36]

Use external framework[link]

Part of Sachs’ philosophy includes strengthening the International Monetary Fund, World Bank, and the United Nations. If those institutions are given the power to enact change, and freed from mitigating influences, then they will be much more effective. Sachs does not find fault in the international organizations themselves. Instead, he blames the member nations who compose them. The powerful nations of the world must make a commitment to end poverty, then stick to it.

^[36]

Aid through existing governments[link]

Sachs believes it is best to empower countries by utilizing their existing governments, rather than trying to circumnavigate them. He remarks that while the corruption argument is logically valid in that corruption harms the efficiency of aid, levels of corruption tend to be much higher on average for countries with low levels of GDP. He contends that this hurdle in government should not disqualify entire populations for much needed aid from the west.

^[36]

Self evaluation[link]

Sachs does not see the need for independent evaluators, and sees them as a detractor to proper progress. He argues that many facets of aid cannot be effectively quantified, and thus it is not fair to try to put empirical benchmarks on the effectiveness of aid.^[36]

Optimism[link]

Sachs’ view makes it a point to attack and attempt to disprove many of the ideas that the more “pessimistic” Easterly stands on.

First, he points to economic freedom. One of the common threads of logic In aid is that countries need to develop economically in order to rise from Poverty. On this, there is not a ton of debate. However, Sachs contends that Easterly, and many other neo-Liberal economists believe high levels of Economic freedom in these emerging markets is almost a necessity to Development. Sachs himself does not believe this. He cites the lack of Correlation between the average degrees of Economic Freedom in countries And their yearly GDP growth, which in his data set is completely Inconclusive.

Also, Sachs contends that democratization is not an integral part of having Efficient aid distribution. Rather than attach strings to our aid dollars, or only Working with democracies or “good governments”, Sachs believes we should Consider the type of government in the needy country as a secondary Concern.

Sachs’ entire approach stands on the assertion that abject poverty could be Ended worldwide by 2025.^[36]

Economic efficiency[link]

David Dollar[link]

Dollar/Collier showed that current allocations of aid are allocated inefficiently. They came to the conclusion that aid money is given in many cases as an incentive to change policy, and for political reasons, which in many cases can be less efficient than the optimal condition. They agree that bad policy is detrimental to economic growth, which is a key component of poverty reduction, but have found that aid dollars do not significantly incentivize governments to change policy. In fact, they have negligible impact. As an alternative, Dollar proposes that aid be funneled more towards countries with “good” policy and less than optimal amounts of aid for their massive amounts of poverty. With respect to “optimal amounts” Dollar calculated the marginal productivity of each additional dollar of foreign aid for the countries sampled, and saw that some countries had very high rates of marginal productivity (each dollar went further), while others [with particularly high amounts of aid, and lower levels of poverty] had low [and sometimes negative] levels of marginal productivity. In terms of economic efficiency, aid funding would be best allocated towards countries whose marginal productivities per dollar were highest, and away from those countries who had low to negative marginal productivities. The conclusion was that while an estimated 10 million people are lifted from poverty with current aid policies, that number could be increased to 19 million with efficient aid allocation.^[37]

Dalgaard[link]

In a followup study to Collier, Dalgaard finds that regardless of policies and utility, aid seems to be less efficient per dollar in the tropics. He states that aid dollars are likely to be just as effective anywhere, so there must be a mitigating externality that is not being accounted for.^[38]

“New Conditionality”[link]

New Conditionality is the term used in a paper to describe somewhat of a compromise between Dollar and Hansen. Paul Mosely describes how policy is important, and that aid distribution is improper. However, unlike Dollar, “New Conditionality” claims that the most important factors in efficiency of aid are income distributions in the recipient country and corruption.^[39]

McGillivray[link]

One of the problems in foreign aid allocation is the marginalization of the fragile state. The fragile state, with its high volatility, and risk of failure scares away donors. The people of those states feel harm and are marginalized as a result. Additionally, the fate of neighboring states is important, as economies of the directly adjacent states to those impoverished, volatile “fragile states” can be negatively impacted by as much as 1.6% of their GDP per year. This is no small figure. McGillivray advocates for the reduced volatility of aid flows, which can only be attained through analysis and coordination.^[40]

Beynon[link]

Beynon revisits Collier/Dollar’s “efficient aid allocation” and finds much of the same results, although he believes that the model needs to be more robust, with more samplings, and take into account other Millennium Development Goals.^[41]

Aid conditionality[link]

Aid often comes with conditions on its allocation. This is called Aid Conditionality. The two types of conditionality are Outcome and Process based conditionality. Outcome conditionality ties aid to a certain goal, while process conditionality ties aid to a certain method of implementation. These two forms of conditionality are often seen together. The problem with aid conditionality is that it not only restricts the local legislatures in how they shape their own country, but often removes local populations from the goal setting and decision making process entirely.^[42]

Academic research has shown that in many instances, aid is conditionally tied due to political motives, rather than notions of proper policy and implementation.

The European Union double standard of trade policy mentioned above is more illustrated in its trade with Latin America. In their April 2002 publication,Oxfarm Report reveals that aid tied to trade Liberalization by the donor countries such as the EU with the aim of achieving economic objective is becoming detrimental to developing countries.For example, the EU subsidizes its agricultural sectors in the expense of Latin America who must liberalize trade in order to qualify for aid. Latin America having, a comparative advantage on agriculture and mainly forms its export sector losts $ 4bn annually due to the EU farm subsidy policies. The aid money actually, instead of being used to finance other development infrastructure, ends up being used to fund terms of trade deficit brought about by trade liberalization. This inequalities and many others imposed upon developing countries have actually benefited the donor rather than the recipient.This cases clearly illustrate the evolution of development aid assistance from providing financial resource to fuel development to being a foreign policy tool used by donor countries to promote their domestic interests. while this can be considered controversial issues, addressing them adequately may help attain some effectiveness in development aid assistance goals.

Aid and UNSC votes[link]

Axel Dreher showed that over the period 1951-2004, there was a robust positive relationship between United Nations Security Council membership and participation in Internation Monetary Fund programs. Additionally, conditions placed on Security Council member nations' aid are lower in number and severity. ^[43] Member nations of the UNSC received on average .8 more World Bank loans per year. ^[44]

Aid conditionality and good governance[link]

Seemingly in support of Bill Easterly's searcher's approach, Carlos Santiso found evidence that conditionality is quite harmful to development, and advocates a "radical approach in which donors cede control to the recipient country".

Santiso also argues that neither good governance or democracy is sustainable without the other. ^[45]

See also[link]

• Debt relief
• Disability aid abroad
• Global Food Security Act of 2009
• International Aid Transparency Initiative
• Transparency International
• United States foreign aid

Notes and references[link]