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Foreign aid donors try to make themselves visible as the funders of development projects in order to improve citizen attitudes abroad. Do target populations receive these political communications in the intended fashion, and do they succeed in changing attitudes? Despite the widespread use of the practice, there exists little evidence about the effectiveness of this strategy. We embed an informational experiment about a U.S.-funded health project in a nationwide survey in Bangladesh. Although we find limited recognition of the USAID brand, explicit information about U.S. funding slightly improves general perceptions of the United States. It does not, however, change respondent's opinions on substantive foreign policy issues. We also find, contrary to existing arguments that foreign aid undermines domestic government legitimacy, that the information increases confidence in local authorities. These results strengthen our understanding of the efficacy of promoting donor visibility and shed light on an important debate in the area of governance that assesses the effect of external actors on government legitimacy.

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There is little consensus on whether foreign aid can reliably increase economic growth in recipient countries. We review the literature on aid allocation and provide new evidence suggesting that since 1990 aid donors reward political contestation but not political inclusiveness. Then we examine some challenges in analyzing cross-national data on the aid/growth relationship. Finally, we discuss the causal mechanisms through which foreign aid might affect growth and argue that politics can be viewed as both (a) an exogenous constraint that conditions the causal process linking aid to growth and (b) an endogenous factor that is affected by foreign aid and in turn impacts economic growth.

Branding of foreign aid may undermine government legitimacy in developing countries when citizens see social services being provided by external actors. We run a survey experiment on a sample of Indian respondents. All subjects learn about an HIV/AIDS program; treated subjects learn that it was foreign-funded. We find null results that, along with existing results in the literature obtained from observational data, call into question the view that foreign-funded service delivery interferes with the development of a fiscal contract between the state and its citizens.