Who Deserves Aid? Equality of Opportunity, International Aid, and Poverty Reduction

SummaryWe build and implement a normative procedure to allocate international aid based on equality of opportunity concerning the risk of poverty. This is an alternative to Collier and Dollar’s proposal [Collier, P., & Dollar, D. (2001). Can the World cut poverty in half? How policy reform and effective aid can meet international development goals. World Development, 29(11), 1787–1802] which stresses the impact of aid on worldwide poverty reduction. Our proposed allocations, like those of Collier and Dollar, differ from current aid allocation by giving more to the poorest countries. Apart from this agreement, they share out poverty risks more fairly among the world’s population, while reducing global poverty almost as effectively as Collier and Dollar’s.