| Summary: | Since World War Two the levels of development aid have continued to increase, in spite of concerns over whether this aid is effective or not. The circumstances that cause development aid to be effective remain a matter for debate. Development aid can be seen to have been of success in many instances, but the failures are as numerous. This paper contends that for aid to be effective, good government effectiveness and a sound fiscal policy environment must first be present. Without the presence of these two factors aid will not only fail but may do harm. Building on the literature on this subject, the paper considers two case studies of Vietnam and Afghanistan.
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