The political economy of evaluation

Most aid projects have the explicit objective to improve welfare and contribute to economic growth. Aid agencies therefore advocate the use of economic analysis in appraisals and evaluations to ensure the achievement of these objectives. Despite such recommendations, economic analyses are rare in many agencies, and when conducted they tend to have more of a legitimizing than predictive or learning value. Within the context of the organizational dynamics of aid agencies, the process of project appraisal and evaluation is studied in four case-studies. The analysis yields important insights into two fundamental questions: What determines international aid agencies' search for knowledge about the economic impact of their operations? And how can aid evaluation be improved in order to increase the effectiveness of aid?