Citation

Discussion Paper Details

Please find the details for DP4781 in an easy to copy and paste format below:

Full Details   |   Bibliographic Reference

Full Details

Title: Intermediation by Aid Agencies

Author(s): Colin Rowat and Paul Seabright

Publication Date: December 2004

Keyword(s): altruism, donations, non-profit, signalling, two-sided market and wage differential

Programme Area(s): Industrial Organization and Public Economics

Abstract: This Paper models aid agencies as financial intermediaries that do not make a financial return to depositors, since the depositors' concern is to transfer resources to investor-beneficiaries. This leads to a significant problem of verification of the agencies' activities. One solution to this problem is for an agency to employ altruistic workers at below-market wages: workers can monitor the agency's activity more closely than donors, and altruistic workers would not work at below-market rates unless the agency were genuinely transferring resources to beneficiaries. We consider conditions for this solution to be incentive compatible.

For full details and related downloads, please visit: https://cepr.org/active/publications/discussion_papers/dp.php?dpno=4781

Bibliographic Reference

Rowat, C and Seabright, P. 2004. 'Intermediation by Aid Agencies'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=4781