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This is a survey paper on aid effectiveness in terms of the contribution of development assistance to economic growth and poverty reduction. The article focuses primarily on the most recent generation of cross-country studies. It concludes that there is a set of broad areas where the evidence reviewed shows signs of convergence that have direct relevance for policy decisions on aid and for aid-effectiveness discussions. These areas are: aid levels (meaning if the level of aid is too low or too high); domestic political institutions (including political stability and the extent of decentralisation); the composition of aid (including sectors, modalities, objectives and time horizons); and the volatility and fragmentation of aid. We also identify two areas where there is little sign of convergence in the evidence: the importance or otherwise of 'good', meaning orthodox macroeconomic policies and whether grants are more effective than loans. [ABSTRACT FROM AUTHOR]

Jonathan Glennie argues that the global economic crisis provides us with the opportunity to alter the way we understand development. It is not just what decisions are made that matters. How they are made is just as important. Just as damaging for developing countries as the wrong-headed thinking behind neo-liberal economic policies has been the arrogance, narrowness and self-interest with which countries have been pressurized into implementing them. We need to build a context in which the right answers are not imposed, but are allowed to emerge, learning from mistakes and sharing lessons. The evidence does not point us towards a new global theory that will right our world's problems, but towards a new attitude, one of radical humility in the face of intense complexity, and of respect for efficient and accountable sovereign governments. [ABSTRACT FROM AUTHOR]