The present paper adds to the already large existing literature on aid distribution as it runs an equation on bilateral aid allocation on a very rich dataset, covering 20 years (1980-99), 22 donors and 137 recipients, which permits a three-dimensional panel study (recipient-year-donor) and...

In this paper, I discuss the incentives that the HIPC Initiative could create in debtor countries in favour of economic adjustment and reform. The usual debt-overhang argument, stating that debt relief will increase the net benefits of reforms, needs to be revisited in this context. First, the...