Counterpart funding requirements and the foreign aid procyclicality puzzle
构建了一个信息不对称下的投资融资模型，解释为何外国援助与受援国经济周期正相关（顺周期），指出援助机构要求受援国提供配套资金是导致这一现象的关键机制。
Official development assistance is a key source of external finance in many developing countries. A striking feature of these aid flows is their positive correlation with business cycles in recipient countries. This pattern is puzzling in that it reinforces recipients’ already strong and costly macroeconomic fluctuations. We propose a simple model of investment financing and aid provision under asymmetric information that rationalizes such a pattern. We assume that donor agencies and recipient governments value projects differently, and that donors know less than recipients do about project characteristics. We show that donors can make a recipient government identify high-return projects by requiring that the latter contribute some of its own funds to projects. Providing these matching grants or ‘counterpart funds’ is less affordable for recipients during economic downturns, which leads to aid procyclicality. Our model produces aid contracts consistent with those used by aid agencies, rationalizes observed aid patterns, and yields a rich set of testable empirical predictions.