Donor Reputation and International Aid Preference: Evidence from Indonesia

• In Event: Foreign Aid and Public Opinion

Abstract

How foreign aid funding influences public perception towards developmental initiatives? Existing research has extensively examined the impact of donor identity on public sentiment, positing that the populace's predilection for various donors is a critical factor. Nonetheless, the precise mechanisms underlying the construction of such favorability remain inadequately elucidated. This paper posits that distinct donors possess unique reputational repertoires in specific domains of expertise, which in turn shape the general public's assessment of the efficacy with which aid projects are executed in recipient nations. To empirically validate this hypothesis, we conducted an online conjoint survey experiment with 2000 participants in Indonesia. Participants were presented with information regarding foreign aid projects, funded by three donor states - China, Japan, and the United States - across six diverse sectors: good governance, public health, infrastructure, education, economic growth, and environmental sustainability. Subsequently, respondents were queried regarding their approval of each project, contingent on their perception of aid delivery effectiveness. The findings of this experiment lend credence to our hypothesis: Different donors indeed demonstrate excellence in varied sectors, a fact that is recognized by the public. This revelation underscores the nuanced and sector-specific nature of donor reputation and its consequential impact on public approval of international aid projects. This study contributes to the broader discourse on international development by elucidating the pivotal role of donor reputation in shaping the reception and perceived effectiveness of foreign aid initiatives.

Authors

• Enze Han, University of Hong Kong

• Lingbo ZHAO, Pennsylvania State University