Politics,Evidence and the New Aid Agenda

Based on study of (a) the HIPC debt relief initiative, (b) the linking of aid to policy conditionality and (c) transactions‐cost arguments in favour of programme aid, this article argues that major elements in the new aid agenda may not be well‐based empirically. This is partly because of inadequate knowledge, but particularly because the evidence often conflicts with political preferences. As a result, it is likely that large amounts of aid resources are being misdirected. Ways are suggested of narrowing the gap between evidence‐based and ‘political’ decision‐making. In the meantime, donors should avoid diverting more aid into debt relief, should roll back their reliance on policy conditionality, and should exercise pragmatic caution in the expansion of programme assistance.     

Still Searching for Excellence? International Accounting and the World's Most Outstanding Companies

This paper measures the effect of accounting policy choices in the context of Davis, Flanders and Star's (DFS) (1991) league table of the world's most outstanding companies. Our study is an investigation of the robustness of the research underlying Kay (1993). The sensitivity of the rankings to the three major conventions that are used in calculating added value are examined: depreciation policy, the estimation of the cost of capital inputs and consistency of international generally accepted accounting principles. The key finding is that the degree of disruption caused by international accounting differences is likely to be the most material. It is equivalent, in this study, to a 60% increase in the cost of capital or an 80% change in the depreciation lives of fixed assets. After adjusting towards consistent international accounting, we now find that four Japanese companies appear in the top ten. Before adjustment there were none.