How bureaucratic competition shapes foreign aid allocation: The case of South Korea's aid agencies

Abstract

What explains aid allocation–donor interests or recipient needs? This research debate has generated a number of studies, which generally conclude that both motivations matter. One limitation of this literature is that donor governments are conceptualized as unitary actors with coherent preferences. In this study, we relax this assumption and focus on the interests and interactions of bureaucratic agencies within a donor government. We argue that these agencies compete as they seek to control a larger share of the foreign aid budget because foreign aid is a valuable policy instrument for bureaucratic agencies. This competition results in emulation: the agency that leads the government's development cooperation policy emulates other agencies' provision of domestic benefits, while the lead agency's competitors mimic its aid allocation patterns. We test our expectations using data on bilateral aid disbursed by four bureaucratic agencies of the South Korean government and find evidence of both types of emulation strategies. Our results point to the role played by a mostly overlooked group of domestic-level actors in donor countries and the importance of bureaucratic politics and competition.