Summary We explore ways of mitigating the costs of aid volatility: in particular, we show that these can be dramatically reduced by a flexible pre-commitment rule which adjusts flows in the case of drastic improvements or deteriorations in country performance ratings. Such a system can further...

Summary Data from the World Bank Enterprise Surveys show that indirect costs (related to infrastructure and services) account for a relatively high share of firms' costs in poor African countries and pose a competitive burden on African firms. We estimate firm-level revenue and value-added...

Summary Evidence is mounting that the pattern of overseas aid through time, of which its volatility (or instability) is a key dimension, has an important influence on its effectiveness. The three papers in this Special Section examine the extent of this influence, and how it may be possible to...