Millennium development goals. An assesment of the success rates and cross-country donor contributions

Abstract

This research has been performed to assess the achievement of the Millennium Development Goals (MDG) and how much each donor is getting involved in Official Development Aid (ODA) contribution. My sources for data are the World Bank, FRED from St. Louis Fed and OECD databases. Using Excel statistical tools, I have got empirical ratios that show the level of MDG compliance. In addition, I estimate an econometric model to understand the determinants of ODA and obtain a measure of political will in each country. This study finds that most of OECD countries haven’t kept their aid promises. Their governments tend to prioritize other expenditures over ODA pledges. The report shows which countries have already reached the traditionally accepted 0,7% target (ODA provided as percentage of GNI). I argue that most of them haven’t done so due to the lack of political will towards aid contribution. The results of the estimate model also indicate that neither the economic situation nor the political party in power have to do with the commitment default. Finally, I recommend an alternative design of ODA agenda along three guidelines. First, budget adjustments for the coming years in order to finance the aid gap. Second, ODA redefinition in order to avoid aid inflation. Third, require an ODA target in accordance with the economic situation of each country.